SENATE, No. 845

STATE OF NEW JERSEY

INTRODUCED FEBRUARY 26, 1996

By Senators CONNORS and BUBBA

An Act increasing the minimum amount of the ordinary disability retirement allowance under the Police and Firemen's Retirement System of New Jersey, amending P.L.1944, c.255 and supplementing P.L.1958, c.143 (C.43:3B-1 et seq.)

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

    1. Section 6 of P.L.1944, c.255 (C.43:16A-6) is amended to read as follows:

    6. (1) Upon the written application by a member in service, by one acting in his behalf or by his employer, any member, under 55 years of age, who has had five or more years of creditable service may be retired on an ordinary disability retirement allowance; provided, that the medical board, after a medical examination of such member, shall certify that such member is mentally or physically incapacitated for the performance of his usual duty and of any other available duty in the department which his employer is willing to assign to him and that such incapacity is likely to be permanent and to such an extent that he should be retired.

    (2) Upon retirement for ordinary disability, a member shall receive an ordinary disability retirement allowance which shall consist of:

    (a) An annuity which shall be the actuarial equivalent of his aggregate contributions and

    (b) A pension in the amount which, when added to the member's annuity, will provide a total retirement allowance of 1 1/2 % of average final compensation multiplied by his number of years of creditable service but in no event shall the total allowance be less than [40%]50% of the member's average final compensation.

    (3) Upon the receipt of proper proofs of the death of a member who has retired on an ordinary disability retirement allowance, there shall be paid to such member's beneficiary, an amount equal to 3 1/2 times the compensation upon which contributions by the member to the annuity savings fund were based in the last year of creditable service; provided, however, that if such death shall occur after the member shall have attained 55 years of age the amount payable shall equal 1/2 of such compensation instead of 3 1/2 times such compensation.

(cf: P.L.1989, c.204, s.2)

    2. (New section) The provisions of section 7 of P.L.1969, c.169 (C.43:3B-8) shall not apply to section 6 of P.L.1944, c.255 (C.43:16A-6) as amended by P.L. , c. (C. ) (now pending before the Legislature as this bill), and the annual cost of living adjustment received by retirants and beneficiaries under P.L.1958, c.143 (C.43:3B-1 et seq.) shall be calculated as of the date of the benefit year of the member of the retirement system.

    3. This act shall take effect immediately, and the increase in benefits provided under this act shall be applicable to the amount of any retirement allowance payable under subsection (2) of section 6 of P.L.1944, c.255 (C.43:16A-6) on or after the first day of the month next following that effective date.

STATEMENT

    This bill increases the minimum amount of the ordinary disability retirement allowance under the Police and Firemen's Retirement System (PFRS) from 40% to 50% of the retirant's average final compensation. The purpose of the legislation is to establish parity of benefits in PFRS between ordinary disability retirants and surviving spouses; the benefit payable to the surviving spouse of a retired member of PFRS (N.J.S.A.43:16A-12.1) was increased to 50% of average final compensation under P.L.1991, c.511.

Increases minimum amount of PFRS ordinary disability retirement allowance from 40% to 50% of average final compensation.