SENATE, No. 2218
STATE OF NEW JERSEY
INTRODUCED JUNE 23, 1997
By Senators LaROSSA and MATHEUSSEN
An Act concerning certain State-administered retirement systems and revising various parts of the statutory law.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. N.J.S.18A:66-36 is amended to read as follows:
18A:66-36. Should a member of the Teachers' Pension and Annuity Fund, after having completed [10] five years of service, be separated voluntarily or involuntarily from the service, before reaching service retirement age, and not by removal for conduct unbecoming a teacher or other just cause under the provisions of sections 18A:28-4 to 18A:28-5 and 18A:28-9 to 18A:28-13 inclusive, such person may elect to receive, in lieu of the payment provided in section 18A:66-34:
a. The payments provided for in section 18A:66-37, if he so qualified under said section; or
b. A deferred retirement allowance beginning at age 60, which shall be made up of an annuity derived from the member's accumulated deductions at the time of his severance from the service, and a pension in the amount which, when added to the member's annuity, will provide a total retirement allowance of 1/70 of his final compensation for each year of service credited as Class A service and 1/60 of his final compensation for each year of service credited as class B service, calculated in accordance with section 18A:66-44, with optional privileges provided for in section 18A:66-47 if he exercises such optional privilege at least 30 days before his attainment of the normal retirement age; provided, that such election is communicated by such member to the retirement system in writing stating at what time subsequent to the execution and filing thereof he desires to be retired; and provided, further, that such member may later elect: (1) to receive the payments provided for in section 18A:66-37, if he had qualified under that section at the time of leaving service, except that in order to avail himself of the optional privileges pursuant to section 18A:66-47, he must exercise such optional privilege at least 30 days before the effective date of his retirement; or (2) to withdraw his accumulated deductions with interest as provided in section 18A:66-34. If such member shall die before attaining service retirement age, then his accumulated deductions, plus regular interest after January 1, 1956, shall be paid in accordance with section 18A:66-38, and, in addition if such member shall die after attaining service retirement age and has not withdrawn his accumulated deductions, an amount equal to 3/16 of the compensation upon which contributions by the member to the annuity savings fund were based in the last year of creditable service shall be paid to such member's beneficiary.
Any member who, having elected to receive a deferred retirement allowance, again becomes an employee covered by the retirement system while under the age of 60, shall thereupon be reenrolled. If he had discontinued his service for more than 2 consecutive years, subsequent contributions shall be at a rate applicable to the age resulting from the subtraction of his years of creditable service at the time of his last discontinuance of contributing membership from his age at the time of his return to service. He shall be credited with all service as a member standing to his credit at the time of his election to receive a deferred retirement allowance.
(cf: P.L.1981, c.177, s.1)
2. Section 11 of P.L.1973, c.140 (C.43:6A-11) is amended to read as follows:
11. Should any member resign, or fail of reappointment who shall have served at least [5] five years successively as a judge of the several courts [and at least 10 years in the aggregate, including such service as a judge or in office, position, or employment of this State or a county, municipality, board of education, or public agency of this State,] before reaching age 60, and not by removal for cause on charges of misconduct or delinquency, he may elect to receive:
a. All of his accumulated deductions standing to the credit of his individual account in the annuity savings fund, or
b. A deferred retirement allowance, beginning on the first day of the month following his attainment of age 60 and the filing of an application therefor, which shall consist of an annuity derived from the accumulated deductions standing to the credit of the member's account in the annuity savings fund at the time of his severance from service together with regular interest, and a pension which, when added to the annuity, will produce a retirement allowance in the amount of 2% of his final salary multiplied by his number of years of service up to 25 plus 1% of his final salary multiplied by his number of years of service over 25, provided that such inactive member may elect to receive payments provided under section 10 if he had qualified under that section at the time of leaving service, except that in order to avail himself of the option, he must exercise such option at least 1 month before the effective date of his retirement. If such inactive member shall die after attaining age 60 but before filing an application for retirement benefits pursuant to this section or section 10 and for which benefits he would have qualified, or in the event of death after retirement, there shall be paid to such member's beneficiary the death benefits prescribed by section 19.
No beneficiary shall be eligible for a pension or survivor's benefit if the member who elected to receive a deferred pension prior to the effective date of this amendatory and supplementary act or who elects to receive a deferred retirement allowance following the effective date of this amendatory and supplementary act shall die before attaining age 60. Upon receipt of the proper proofs of death, the beneficiary of a member who elects to receive a deferred retirement allowance shall be paid the member's accumulated deductions at the time of death together with regular interest.
Any member who, having elected to receive a deferred pension or deferred retirement allowance, again becomes a member while under the age of 60, shall thereupon be reenrolled. He shall be credited with all service as a member standing to his credit at the time of his election to receive a deferred pension or deferred retirement allowance.
(cf: P.L.1981, c.470, s.5)
3. Section 38 of P.L.1954, c.84 (C.43:15A-38) is amended to read as follows:
38. Should a member of the Public Employees' Retirement System, after having completed [10] five years of service, be separated voluntarily or involuntarily from the service, before reaching service retirement age, and not by removal for cause on charges of misconduct or delinquency, such person may elect to receive:
(a) The payments provided for in section 41b. of this act, if he so qualifies under said section, or;
(b) A deferred retirement allowance, beginning at the retirement age, which shall be made up of an annuity derived from the accumulated deductions standing to the credit of the individual member's account in the annuity savings fund at the time of his severance from the service together with regular interest, and a pension which when added to the annuity will produce a total retirement allowance of 1/70 of his final compensation for each year of service credited as Class A service and 1/60 of his final compensation for each year of service credited as Class B service, calculated in accordance with section 48 of this act, with optional privileges provided for in section 50 of this act if he exercises such optional privilege at least 30 days before his attainment of the normal retirement age; provided, that such election is communicated by such member to the retirement system in writing stating at what time subsequent to the execution and filing thereof he desires to be retired; and provided further, that such member, as referred to in this subsection may later elect: (1) to receive the payments provided for in section 41b. of this act, if he had qualified under that section at the time of leaving service, except that in order to avail himself of the optional privileges pursuant to section 50, he must exercise such optional privilege at least 30 days before the effective date of his retirement; or (2) to withdraw his accumulated deductions with interest as provided in section 41a. If such member shall die before attaining service retirement age then his accumulated deductions, plus regular interest, shall be paid in accordance with section 41c.; or if such member shall die after attaining service retirement age and has not withdrawn his accumulated deductions, an amount equal to 3/16 of the compensation received by the member in the last year of creditable service shall be paid to such person, if living, as he shall have nominated by written designation duly executed and filed with the retirement system; otherwise to the executor or administrator of the member's estate.
(cf: P.L.1981, c.177, s.4)
4. Section 5 of P.L.1972, c.167 (C.43:15A-139) is amended to read as follows:
5. A member, who shall have served as a member of the Legislature for at least [8] five years and having made contributions therefor to the retirement system and who ceases to be a member of the Legislature for any reason other than death before reaching age 60, may, upon termination of such service as a member of the Legislature and all other public service covered by the retirement system elect to receive, in lieu of the payment provided in P.L.1954, c.84, s.41a (C.43:15A-41a): (a) the payments provided for in P.L.1954, c.84, s. 38 (C.43:15A-38) if he so qualifies under said section, or (b) the payments provided for in P.L.1954, c.84, s.41b (C.43:15A-41b) if he so qualifies under said section, or (c) a deferred retirement allowance beginning on the first day of the month following his attainment of age 60 and the filing of an application therefor, which shall be made up of an annuity derived from the member's accumulated deductions at the time of termination of his service as a member of the Legislature and a pension in the amount which, when added to the member's annuity, will provide a total retirement allowance of 3% of final compensation as a legislator, for each year of creditable service as a member of the Legislature.
The benefit payable pursuant to this section shall be subject to the maximum allowance provisions of section 4 of this supplementary act.
The provisions for the exercise of optional privileges, the payment of accumulated contributions in the event of death before attaining service retirement age, and the death benefit in the event of death following retirement, shall be those stipulated in P.L.1954, c.84, s.38 (C.43:15A-38) in the case of any member of the Legislature retiring under the provisions of this section.
(cf: P.L.1972, c.167, s.5)
5. Section 17 of P.L.1964, c.241 (C.43:16A-11.2) is amended to read as follows:
17. Should a member, after having established [10] five years of creditable service, be separated voluntarily or involuntarily from the service, before reaching age 55, and not by removal for cause on charges of misconduct or delinquency, such person may elect to receive the payments provided for in section 11 of P.L.1944, c.255 or section 16 of P.L.1964, c.241, or a deferred retirement allowance, beginning on the first day of the month following his attainment of age 55 and the filing of an application therefor, which shall consist of:
(1) An annuity which shall be the actuarial equivalent of his aggregate contributions at the time of his severance from the service and
(2) A pension in the amount which, when added to the member's annuity, will provide a total retirement allowance of 2% of his average final compensation multiplied by the number of years of his creditable service up to 30 plus 1% of his average final compensation multiplied by the number of years of creditable service over 30, provided that such inactive member may elect to receive payments provided under section 11 of P.L.1944, c. 255 or section 16 of P.L.1964, c. 241 if he had qualified under that section at the time of leaving service, except that in order to avail himself of the option, he must exercise such option at least 30 days before the effective date of his retirement. If such inactive member shall die before attaining age 55, his aggregate contributions shall be paid in accordance with section 11 of P.L.1944, c.255 and, in addition if such inactive member shall die after attaining age 55 but before filing an application for retirement benefits pursuant to this section or section 16 of P.L.1964, c.241 and has not withdrawn his aggregate contributions, or in the event of death after retirement, an amount equal to one-half of the compensation upon which contributions by the member to the annuity savings fund were based in the last year of creditable service shall be paid to such member's beneficiary.
Any member who, having elected to receive a deferred retirement allowance, again becomes an employee covered by the retirement system while under the age of 55, shall thereupon be reenrolled. If he had discontinued his service for more than 2 consecutive years, subsequent contributions shall be at his former rate increased for the years of his inactive membership. He shall be credited with all service as a member standing to his credit at the time of his election to receive
a deferred retirement allowance.
(cf: P.L.1981, c.177, s.5)
6. Section 28 of P.L.1965, c.89 (C.53:5A-28) is amended to read as follows:
28. a. Should a member, after having established [10] five years of creditable service as a full time commissioned officer, noncommissioned officer or trooper of the Division of State Police, be separated voluntarily or involuntarily from the service, before reaching age 55, and not by removal for cause on charges of misconduct or delinquency, such person may elect to receive the payments provided for in section 26 or 27 or a deferred retirement allowance, beginning on the first day of the month following his attainment of age 55 and the filing of an application therefor, which shall consist of:
(1) An annuity which shall be the actuarial equivalent of his aggregate contributions at the time of his severance from the service, and
(2) A pension in the amount which, when added to the member's annuity, will provide a total retirement allowance of 2% of his final compensation multiplied by his number of years of creditable service up to 25 plus 1% of his final compensation multiplied by his number of years of creditable service over 25, provided that such inactive member may elect to receive payments provided under section 26 or 27 if he had qualified under that latter section at the time of leaving service, except that in order to avail himself of the option, he must exercise such option at least 1 month before the effective date of his retirement. If such inactive member shall die before attaining age 55, his aggregate contributions shall be paid in accordance with section 26 and, in addition if such inactive member shall die after attaining age 55 but before filing an application for retirement benefits pursuant to this section or section 27 and for which benefits he would have qualified and has not withdrawn his aggregate contributions, or in the event of death after retirement, an amount equal to one-half of the final compensation received by the member shall be paid to such member's beneficiary.
b. (Deleted by amendment.)
c. Any member who, having elected to receive a deferred retirement allowance, again becomes an employee covered by the retirement system while under the age of 55, shall thereupon be reenrolled. He shall be credited with all service as a member standing to his credit at the time of his election to receive a deferred retirement allowance.
(cf: P.L.1981, c.177, s.6)
7. This act shall take effect immediately.
STATEMENT
These amendments reduce the period of service required to attain status as a vested member of the Teachers' Pension and Annuity Fund (TPAF), the Judicial Retirement System (JRS), the Public Employees' Retirement System (PERS), the Police and Firemen's Retirement System (PFRS), and the State Police Retirement System (SPRS) to five years.
The revised vesting period for which this bill provides is consistent with the standards set forth in Sec.203 of the federal "Employee Retirement Income Security Act of 1974" ("ERISA"), P.L.93-406 (29 U.S.C. §1053).
Reduces vesting period under TPAF, JRS, PERS, PFRS, and SPRS to five years.