SENATE STATE MANAGEMENT, INVESTMENT AND FINANCIAL INSTITUTIONS COMMITTEE

STATEMENT TO

SENATE, No. 1301

STATE OF NEW JERSEY

DATED: NOVEMBER 7, 1996

      The Senate State Management, Investment and Financial Institutions Committee reports favorably Senate, No. 1301.

      This bill concerns the calculation of post-retirement death benefits under the Public Employees' Retirement System (PERS). Under current law, the death benefit payable to a retirant's beneficiary upon the retirant's death is based upon the compensation received by the member in the last year of creditable service. This bill provides that the death benefit would be based upon either that compensation or the highest compensation received by the member during any fiscal year of membership, whichever is greater.

      At its October 11, 1996 meeting, the Pension and Health Benefits Review Commission recommended that the Legislature enact this bill "in order to ensure that retiree life insurance benefits are based on the highest salary.