S2087

SENATE, No. 2087

STATE OF NEW JERSEY

INTRODUCED MAY 15, 1997

By Senator LIPMAN

An Act concerning the employees' retirement system of certain cities of the first class and amending P.L.1954, c.218 and P.L.1972, c.122.

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

1. Section 1 of P.L.1954, c.218 (C.43:13-22.3) is amended to read as follows:

1. As used in this act:

"Service" shall always, unless otherwise stated, be considered as in the aggregate.

"Salary" or "compensation," when used solely for the purpose of fixing benefits under this act, means annual salary or compensation earned by a member as a permanent employee at the time of his death or retirement [; provided, however, that $16,000.00 shall be the maximum amount of the annual salary of any member which shall be considered for any purpose under this act; provided further, however, that as to any employee who, at the time of the adoption of this act, is a member of any retirement system in operation in the city under and by virtue of article 2, chapter 13, Title 43 of the Revised Statutes; and of chapter 18, Title 43 of the Revised Statutes; and of chapter 19, Title 43 of the Revised Statutes, the total annual salary received by such member as a permanent employee at the time of his death or retirement shall be considered for pension or other purposes under this act, except as otherwise provided herein, and further that where an employee heretofore has been receiving more than $12,000.00 in salary or compensation prior to the effective date of the amendment increasing the salary or compensation ceiling to $16,000.00, and he did not pay into the system all sums that he would have contributed on his full salary he shall not be eligible for the benefits permitted by the increased ceiling unless he pays into the system all said sums he would have paid had he not failed to contribute continuously. Application for the exercise of such option shall be made to the commission within 6 months next succeeding the effective date of this amendatory act.

(a) Any such benefit for retirement or otherwise accruing as a result of the increase in the salary or compensation ceiling for more than $12,000.00 shall be on the average annual salary received by such employee member for 1 year preceding his retirement.

(b) The repayment of any contributions shall be made within such period of time as shall be granted by the commission but at no time for a greater period than 3 years].

"Pension fund" or "fund" means the fund referred to in section 2 of this act, and is the fund from which pensions and other benefits provided for in this act shall be paid.

"State" shall, unless otherwise stated, mean the State of New Jersey.

"City," unless otherwise specified, means any city of the first class of the State of New Jersey having, at the time of the enactment of this act, a population in excess of 400,000 inhabitants.

"His" shall be construed to mean both sexes.

"City employee" or "employee" means and includes all permanent employees as defined by Title [11] 11A of the [Revised] New Jersey Statutes [of New Jersey] (Civil Service Law) in service in any city of the first class of this State, as hereinabove defined; and shall mean and include all permanent employees of any city board, body or commission maintained out of city funds in such city. Notwithstanding the provisions of any other statute of this State, any person under 45 years of age hereafter accepting permanent employment in the city (excepting uniformed policemen and firemen) shall, subject to the provisions of section 13(a) of this act, become a member of the pension fund provided by this act as a "city employee" or "employee" as hereinabove defined; and except as herein otherwise provided, any such person of the age of 45 years or over shall be ineligible to become a member; provided, however, that any employee who, at the time of the adoption of this act, is a member of any retirement system in operation in such city under and by virtue of article 2, chapter 13, Title 43 of the Revised Statutes; or of chapter 18, Title 43 of the Revised Statutes; or of chapter 19, Title 43 of the Revised Statutes, shall not be barred from membership in this retirement system on account of age of any such employee.

Notwithstanding the provisions of chapter 1, Title 43 of the Revised Statutes, any present employee of the city as herein defined, who was not more than 45 years of age at the time of his permanent appointment, shall, subject to the provisions of section 13 of this act, have the right, subject to section 13(b) of this act, to become a member of the retirement system established by this act, by declaring his intention in writing so to do, within 2 months after the formation of the commission created by this act.

All such applicants shall submit to and pass a physical examination as required by the commission, and shall pay into the retirement system all arrears of dues and assessments determined by the commission, with interest thereon at 3%, in order to receive credit for said prior service as an employee, for the purposes of this act. The maximum length of time to be afforded any such employee for payment of said arrears and interest thereon shall be 5 years from the date of membership in said system.

"Widow" or "widower" means the surviving spouse of a city employee married to such employee for a period of at least 5 years prior to the retirement or death of such employee, except as otherwise provided herein, and said marriage having occurred prior to the time when such employee reached the age of 55 years, except that where death results from and as a result of an accident or injury sustained in the line of duty, the widow or widower shall be entitled to the benefits hereinafter set forth, even though the marriage has not been in existence for a period of 5 years; provided, however, that no pension shall be paid to the widow or widower unless he or she was receiving at least one-half of his or her support from the employee or pensioner member in the 12-month period immediately preceding the member's death or the accident which was a direct cause of the member's death. The dependency of such widow or widower shall be considered terminated by the remarriage of the widow or widower subsequent to the member's death. No pension shall be paid to any minor child or dependent parent of such employee unless such minor child or dependent parent shall be and shall continue to remain dependent upon the income which such employee was receiving at the time of his or her death. The pension commission shall determine the question of the dependency of the surviving spouse, minor child or dependent parent, as well as the ability of the surviving spouse to pursue some gainful occupation.

"Minor child" means a child under the age of 18 years, whose father or mother was married to the employee-member for a period of at least 5 years prior to the retirement of said employee, and the said marriage having occurred prior to the time such employee arrived at the age of 55 years. It shall also mean a child of any age who is permanently and totally disabled as determined by the commission by virtue of physical or mental deficiencies precluding engagement in gainful employment and who is solely dependent for support upon the employee-member.

"Dependent parent" shall mean a dependent parent or parents who is or are solely dependent for support upon the employee-member.

"Commission" shall mean pension commission.

"Commissioners" shall mean pension commissioners, unless otherwise specified.

"Permanent" and "total" disability means physical or mental incapacity of an employee, as determined by the commission, and which would make the employee unable to perform the duties of his position or office.

"Employees' Retirement System of (name of city)" shall be the name of the retirement system provided under the provisions of this act. By that name all of its business shall be transacted, its funds invested, warrants for money drawn and payments made, and all of its cash and securities and other property held.

"So long as he or she remains unmarried" when referring to widows or widowers, shall mean "until he or she remarries."

(cf: P.L.1979, c.281, s.1)

2. Section 17 of P.L.1954, c.218 (C.43:13-22.19) is amended to read as follows:

17. Subject to the other provisions of this act, any employee member who shall have served or who shall hereafter have served in the employ of such city in the aggregate for a period of 30 years and who shall have attained the age of 55 years, or who shall have served in the aggregate for a period of 25 years and who have or have not attained the age of 60 years, shall, upon his application, be retired on a pension equal to one-half of the salary he is receiving at the time of his retirement, and for each year of service beyond 30 years and up to 40 years the retiring employee shall, for each additional year, receive an additional pension of 2 1/2% of the salary received by him at the time of his retirement; provided, however, that the pension shall be reduced by 1/4 of 1% for each month that the member lacks of being age 55, and that no pension shall exceed three-quarters of the annual salary received by the said employee member[, nor shall any pension exceed the sum of $12,000.00 per annum].

(cf: P.L.1975, c.108, s.2)

3. Section 18 of P.L.1954, c.218 (C.43:13-22.20) is amended to read as follows:

18. Subject to the other provisions of this act, upon and after the death of such employee member or pensioner member, said retirement pension shall be paid to the surviving widow or widower, so long as he or she remains unmarried; minor children or dependent parents, as the case may be [; provided, however, that in no instance shall a pension payment to such widow or widower, minor children or dependent parent exceed $3,000.00 per annum]. In the event of the death of a pensioner member, such payments shall not exceed the amount received by the decedent pensioner.

(cf: P.L.1979, c.281, s.8)

4. Section 19 of P.L.1954, c.218 (C.43:13-22.21) is amended to read as follows:

19. Subject to the other provisions of this act, any member employee who shall have served or who shall hereafter have served in the employ of such city continuously for a period of 5 years and shall become permanently and totally disabled as the result of injury or illness not arising out of and in the course of his employment, shall, upon his application and approval thereof by the commissioners be retired on a pension equal to 2 1/2 % of the salary received by him at the time of his retirement; and for each additional year of aggregate service, but not more than 20 years of service in the aggregate, the amount of said pension shall be increased to the extent of 2 1/2 % of said salary for each year, not exceeding in any event 50% of said salary; provided, however, that for each year of service over 30 years there shall be an increase of disability pension of 2 1/2 % of the salary received by the employee at the time of said retirement; provided further, however, that no such pension, regardless of service or disability, shall exceed three-quarters of the annual salary of said employee at the time of retirement [; nor shall any such pension be in excess of $12,000.00 per annum]. Upon and after the death of such retired member or upon and after the death of any member who died as a result of injury or illness not arising out of and in the course of his employment, the said pension or a pension based upon the services of said member as the case may be, shall be paid to the surviving widow or widower, so long as he or she remains unmarried, minor children or dependent parent, as the case may be [; provided, however, that in no instance shall said pension exceed the sum of $3,000.00 per annum].

(cf: P.L.1979, c.281, s.9)

5. Section 20 of P.L.1954, c.218 (C.43:13-22.22) is amended to read as follows:

20. Subject to the other provisions of this act, any city employee who shall become permanently or totally disabled as a result of injury or illness arising out of and in the course of his employment shall, upon his application and approval thereof by the commission, be retired on a pension equal to one-half of the annual salary received by him at the time of his retirement; provided, however, that [in no instance shall the pension exceed $12,000.00 per annum; and provided further, however, that] where an employee has served more than 30 years he shall be entitled to 2 1/2 % of his annual salary for each additional year of service over 30 years, but not exceeding 40 years [, and in no event shall such pension exceed $12,000.00 annually]. Upon and after the death of such retired member or upon and after the death of any member who dies as a result of any injury or illness arising out of and in the course of his employment, the said pension or a pension of one-half of the said annual salary of such member shall be paid as hereinafter provided to the surviving widow or widower, so long as he or she remains unmarried; minor children or dependent parent, as the case may be [; provided, however, that in no instance shall the pension exceed $3,000.00 per annum].

(cf: P.L.1979, c.281, s.10)

6. Section 23 of P.L.1954, c.218 (C.43:13-22.25) is amended to read as follows:

23. Subject to the other provisions of this act, upon the death of any employee member who shall have served or who shall hereafter have served in the employ of the city continuously for a period of at least 5 years, there shall be paid to the surviving widow or widower, so long as he or she remains unmarried; minor children or dependent parent, as the case may be, an amount equal to 2 1/2 % of the salary received by such employee at the time of his death and 2 1/2 % of said yearly salary for each additional year of service more than 1 year, but not exceeding in any event 50% of said salary received at the time of death [, and in no instance shall such pension exceed $3,000.00]; provided, however, that wherever the provisions of any of the three pension funds which have been merged into the fund, provide for greater benefits for the present members thereof, their widows, widowers, minor children or dependent parent, then and in that event the said widow, widower, minor children or dependent parent shall be entitled to said greater benefits as therein provided; and provided, further, that after 5 years' membership in the retirement system, the pension payment to widow or widower shall not be less than $1,000.00. In the event of the death of a pensioner member the amount of pension payment paid his or her widow or widower shall not exceed the amount of the pension payments he or she received at the time of his or her death [and in no event in excess of $3,000.00 annually].

(cf: P.L.1979, c.281, s.11)

7. Section 24 of P.L.1954, c.218 (C.43:13-22.26) is amended to read as follows:

24. Subject to the other provisions of this act, upon and after the death of any employee member, pensioner member, or beneficiary, the benefits herein provided for the surviving widow or widower, minor children, including adopted children, and dependent parent shall be paid in the following manner of priority:

(1) To the surviving widow or widower, until he or she remarries;

(2) If no widow or widower, or upon the death of such widow or widower, then the pension shall be paid to the guardian of the minor children, for the exclusive use of said children [, in the following amounts, $80.00 per month for each minor child, provided further that in no event shall the funds paid to minor children exceed in the aggregate the sum of $3,000.00 annually].

(3) In the event there be no surviving widow, widower, or minor children, then the pension shall be paid to the dependent parent or parents in equal shares.

(cf: P.L.1979, c.281, s.12)

8. This act shall take effect upon the filing with the office of the Secretary of State of a copy of an ordinance of the governing body of the city adopting the provisions hereof.

STATEMENT

This bill amends the law governing the Employees' Retirement System of the City of Newark (Newark ERS), subject to passage by the governing body of that city of an ordinance adopting the provisions of the legislation. The bill:

(1) Removes the limit on the amount of annual salary ($16,000) upon which a beneficiary's pension is calculated; and

(2) Deletes, in conjunction with removal of the cap on pensionable salary, various specific dollar caps on other retirement and survivor benefits.

Increases pension benefits for certain retirees in certain municipal retirement systems.