SENATE, No. 562

STATE OF NEW JERSEY

INTRODUCED JANUARY 29, 1996

By Senator BENNETT

An Act concerning the purchase of prior service credit by certain members of the Public Employees' Retirement System.

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

    1. Notwithstanding the provisions of any other law, rule, or regulation to the contrary, a member of the Public Employees' Retirement System whose employer is a regional high school district board of education in a county of the fifth class with a population greater than 500,000 according to the most recent federal decennial census and who was enrolled as a member during 1975 but was eligible to have been enrolled as of July 1, 1966 may purchase credit for the service between July 1, 1966 and the date of enrollment in 1975 by paying into the annuity savings fund the amount required by applying the factor, supplied by the actuary, as being applicable to the member's age as of July 1, 1966 to the member's salary at that time. The purchase may be made in regular installments, equal to at least one-half the full normal contribution to the retirement system, over a maximum period of 10 years. The State shall be liable for any remaining payment to the retirement system necessary to pay the full cost of the purchase of credit for this service. The application to the retirement system for the purchase of such service shall be made no later than the 90th day after the effective date of this act.

    Any member electing to purchase this service who retires prior to completing payments as agreed with the retirement system will receive pro rata credit for service purchased prior to the date of retirement, but if the member so elects at the time of retirement, the member may make such additional lump sum payment at that time as will be necessary to provide full credit.

    2. This act shall take effect immediately.

STATEMENT

    This bill permits a member of the Public Employees' Retirement System whose employer is a regional high school district board of education in a county of the fifth class with a population greater than 500,000 according to the most recent federal decennial census and who was enrolled as a member during 1975 but was eligible to have been enrolled as of July 1, 1966 to purchase credit for the service between July 1, 1966 and the date of enrollment in 1975 by paying into the annuity savings fund the amount required by applying the factor, supplied by the actuary, as being applicable to the member's age as of July 1, 1966 to the member's salary at that time. The State shall be liable for any remaining payment to the retirement system necessary to pay the full cost of the purchase of credit for this service. The application to the retirement system for the purchase of such service shall be made no later than the 90th day after the effective date of this act.

Permits purchase of prior service credit by certain members of PERS.