ASSEMBLY, No. 1007

STATE OF NEW JERSEY

Introduced Pending Technical Review by Legislative Counsel

PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION

By Assemblymen MORAN and CONNORS

An Act increasing the amount of the adjustment of certain retirement allowances and survivor benefits and amending P.L.1969, c.169.

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

    1. Section 6 of P.L.1969, c.169 (C.43:3B-7) is amended to read as follows:

    6. a. On or before October 1, 1977 and by the same date in each subsequent year, the Director of the Division of Pensions shall review the index and determine the percentum of change in the index from the benefit year index. In determining the percentum of change the director shall use the index for the year ending the August 31 prior to the date of review, dividing such index by the benefit year index and then subtracting 100% from the resulting quotient expressed to the nearest 1/100 of 1%. The percentage of adjustment shall be 3/5 of the percentum of change. Any adjustment so calculated shall apply to all of the months of the following calendar year for eligible retirants and beneficiaries, except for those qualifying for the first time, it shall apply only to those months of the following calendar year in which the retirant or beneficiary is eligible to receive the adjustment.

    b. In the case of any retirant or beneficiary under the provisions of P.L.1955, c.257 (C.43:15A-97 et seq.), of chapter 16 of this title, or of P.L.1944, c.255 (C.43:16A-1 et seq.), for each 12-month period following the calendar year in which P.L. , c. (now pending before the Legislature as this bill) shall take effect as law or following the first 12-month period during which the retirant or beneficiary receives an adjustment under P.L.1969, c.169, whichever occurs later, the percentage of adjustment shall be increased by an additional 10% of the percentum of change until the percentage of adjustment equals 100% of the percentum of change, after which the retirant or beneficiary shall continue to receive an annual adjustment of 100% of the percentum of change in the index.

    c. The director shall include[(a)]in his corpus appropriation request for the administration of the act on behalf of those retirants and beneficiaries for whom the State assumes the costs attributable to this act, and[, (b)]in his certification of amounts due from each employer in accordance with section 4 of the Pension Adjustment Act, (1) amounts sufficient to adjust the retirement allowances, survivorship benefits or pensions payable to all eligible retirants and beneficiaries by 3/5 of the percentum of change in the index as such retirement allowances, survivorship benefits or pensions may have been originally granted, or increased for certain retirants or beneficiaries in accordance with section 3 of the Pension Adjustment Act, and (2) such additional amounts as are necessary to adjust the retirement allowance, pension or survivorship benefit due retirants or beneficiaries under the annual adjustment provisions set forth in subsection b. of this section. In no instance shall the amount of the retirement allowance or pension originally granted and payable to any retirant be reduced as a result of the adjustment made pursuant to the provisions of P.L.1969, c.169.

    [b.]d. For purposes of this act a "retirant" shall mean any retirant who has or shall have received a retirement allowance or pension for no less than 24 months and a "beneficiary" shall mean any beneficiary who has or shall have received for no less than 24 months a pension, or survivorship benefit, or whose increased pension pursuant to the provisions of the statutes stipulated in subsection d(4) of section 1 of the act to which this act is an amendment (C.43:3B-1). In the case of beneficiaries, all or any part of the 24 month period shall include the period in which the retirant was entitled to receive his retirement allowance or pension.

(cf: P.L.1977, c.306, s.4)

    2. This act shall take effect July 1 next following enactment.

STATEMENT

    This bill would permanently increase the cost of living adjustment in pension allowances and survivor benefits for all retirants and beneficiaries under the Consolidated Police and Firemen's Pension Fund (CPFPF) and the Police and Firemen's Retirement System (PFRS), and also for retired law enforcement officers (LEOs) and their beneficiaries under the Public Employees' Retirement System (PERS).

    Under current law, the amount of the adjustment is fixed at three-fifths (60%) of the percentum of change in the federal Consumer Price Index for Urban Wage Earners and Clerical Workers and is payable after the pension allowance, survivor benefit, or both have been received for 24 months. Under the bill, the amount of the adjustment for each retirant or beneficiary in the indicated categories would be increased from 60% to 100% of the change in the index. The increase would be phased in, at the rate of 10% per year, over the four-year period following commencement of the adjustment payments: the adjustment would continue to be 60% of the percentum of change in the index during the first year of eligibility, then increase to 70% during the second year, 80% during the third year, 90% during the fourth year, and 100% after the fourth year.

Increases cost of living adjustment in pension allowances and survivor benefits payable to certain former public safety officers and their survivors.