ASSEMBLY, No. 2624

STATE OF NEW JERSEY

INTRODUCED DECEMBER 19, 1996

By Assemblyman BAGGER

An Act concerning certain deferred compensation plans and amending P.L.1977, c.381 and P.L.1978, c.39.

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

    1. Section 5 of P.L.1977, c.381 (C.43:15B-5) is amended to read as follows:

    5. All moneys which are deferred and deducted in accordance with the provisions of this act and the plan shall remain assets of the employer and shall be invested in accord with the provisions of this act and the plan. The obligation of the employer to participating employees shall be contractual only and no preferred or special interest in the deferred moneys shall accrue to such employees, except that all assets and income of the plan shall be held in trust for the exclusive benefit of participating employees and their beneficiaries.

(cf: P.L.1977, c.381, s.5)

    2. Section 8 of P.L.1978, c.39 (C.52:18A-170) is amended to read as follows:

    8. All moneys which are deferred and deducted in accordance with the provisions of this act and the plan shall remain assets of the State and shall be invested in accord with the provisions of this act and the plan. The obligation of the State to participating employees and contractors shall be contractual only and no preferred or special interest in the deferred moneys shall accrue to such employees or contractors, except that all assets and income of the plan shall be held in trust for the exclusive benefit of participating employees and their beneficiaries.

(cf: P.L.1978, c.39, s.8)

    3. This act shall take effect immediately.

STATEMENT

    Any municipality, county, authority created by one or more municipalities or counties, or the State may establish a deferred compensation plan for its employees. The purpose of this bill is to protect the interests of participating employees in a deferred compensation plan and to conform State law with federal law regarding the management of assets and income under these plans. The bill provides that all assets and income of a deferred compensation plan shall be held in trust for the exclusive benefit of participating employees and their beneficiaries.

Provides that deferred compensation plan assets and income shall be held in trust for the exclusive benefit of participating employees and their beneficiaries.