SENATE BUDGET AND APPROPRIATIONS COMMITTEE

STATEMENT TO

SENATE, No. 644

STATE OF NEW JERSEY

DATED: JUNE 19, 1997

      The Senate Budget and Appropriations Committee reports favorably Senate Bill No. 644.

      Senate Bill No. 644 revises the amount of the lump sum death benefit payable to the surviving beneficiary of a retired member of the Judicial Retirement System (JRS) who dies while engaged in temporary service within the judicial system to which the retirant has been recalled by the Supreme Court.

      Under present law, the amount of the lump sum death benefit payable upon the death of a retired JRS member (other than certain disability retirants) is equal to one-fourth of the retired member's final salary. Under this bill, if the death occurs while the retirant is engaged in temporary service as a recalled justice or judge, the amount of the benefit would be increased to one and one-half times that final salary, the same as the amount payable upon the death of a JRS member who dies in active service.

      This act will take effect immediately and will be retroactive to June 1, 1994.

      As reported, this bill is identical to Assembly Bill No. 1267 (Russo/Doria).

FISCAL IMPACT:

      According to the Office of Legislative Services, there are very few instances of retired members of the JRS being recalled to temporary duty by the Supreme Court. According to the most recent actuarial valuation of the retirement system, there are 410 active members and 332 retirees in the system.

      The OLS notes according to the valuation, the average salary for members of the JRS is $116,068. Based on this information, the cost of providing the current lump sum death benefit of one-fourth the member's final salary is $29,017. The cost of providing a lump sum benefit of one and one-half times final salary would be $174,102, or $145,083 more than the benefit provided under current law.