1999 Legislation
Print Friendly

HOUSE BILL NO. 22 – PERSI, disabled, definition


View Daily Data Tracking History

View Bill Text

View Statement of Purpose / Fiscal Impact

Text to be added within a bill has been marked with Bold and
Underline. Text to be removed has been marked with
Strikethrough and Italic. How these codes are actually displayed will
vary based on the browser software you are using.

This sentence is marked with bold and underline to show added text.

This sentence is marked with strikethrough and italic, indicating
text to be removed.

Daily Data Tracking History

H0022........................................................by MR. SPEAKER
              Requested by Public Employees Retirement System
PUBLIC EMPLOYEE RETIREMENT SYSTEM - Amends existing law relating to the
Public Employee Retirement System to clarify the definitions of
"disability" and "disabled service."

01/11    House intro - 1st rdg - to printing
01/11    Rpt prt - to Comm/HuRes
02/02    Rpt out - rec d/p - to 2nd rdg
02/03    2nd rdg - to 3rd rdg
02/04    3rd rdg - FAILED - 13-56-0
      AYES -- Bell, Clark, Crow, Hadley, Hornbeck, Jones, Lake, McKague,
      Montgomery, Mortensen, Pischner, Ridinger, Williams
      NAYS -- Alltus, Barraclough, Barrett, Black, Boe, Bruneel, Callister,
      Campbell, Chase, Cuddy, Deal, Denney, Ellsworth, Field(13),
      Field(20), Gagner, Geddes, Gould, Hammond, Hansen(23), Hansen(29),
      Henbest, Jaquet, Judd, Kellogg, Kempton, Kendell, Kjellander, Kunz,
      Limbaugh, Linford, Loertscher, Mader, Marley, Meyer, Moyle, Pomeroy,
      Reynolds, Ringo, Robison, Sali, Schaefer, Sellman, Smith, Stevenson,
      Stoicheff, Stone, Taylor, Tilman, Tippets, Trail, Watson, Wheeler,
      Wood, Zimmermann, Mr Speaker
      Absent and excused -- None
    Dist. 19, Seat A, Vacant
    Floor Sponsor - Lake
    Filed with Chief Clerk

Bill Text


 ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
Fifty-fifth Legislature                 First Regular Session - 1999

                             IN THE HOUSE OF REPRESENTATIVES

                                    HOUSE BILL NO. 22

                                      BY MR. SPEAKER
                     Requested by: Public Employees Retirement System

 1                                        AN ACT

 5    Be It Enacted by the Legislature of the State of Idaho:

 6        SECTION 1.  That Section 59-1302, Idaho Code, be, and the same  is  hereby
 7    amended to read as follows:

 8        59-1302.  DEFINITIONS.  (1)  As  used  in  this chapter, each of the terms
 9    defined in this section shall have the meaning given in this section unless  a
10    different meaning is clearly required by the context.
11        (2)  "Active  member" means any employee who is not establishing the right
12    to receive benefits through his or her employer's participation in  any  other
13    retirement  system  established for Idaho public employees, if such participa-
14    tion is mandated by applicable Idaho statutes other than this chapter.  In  no
15    case will an employee be entitled to any benefit under this chapter for public
16    service  if  such  employee is establishing retirement benefit entitlements by
17    other Idaho statutes or federal statutes other than military service or social
18    security for that same service.
19        (3)  "Accumulated contributions" means the sum of amounts contributed by a
20    member of the system, together with regular interest credit thereon.
21        (4)  "Actuarial equivalent" means a benefit equal in value to another ben-
22    efit, when computed upon the basis of the actuarial tables in use by the  sys-
23    tem.
24        (5)  "Actuarial  tables"  means  such tables as shall have been adopted by
25    the board in accordance with recommendations of the actuary.
26        (5A)  "Alternate payee" means a spouse or former spouse of a member who is
27    recognized by an approved domestic retirement order as having a right  to  all
28    or  a portion of the accrued benefits in the retirement system with respect to
29    such member.
30        (5B)  "Approved domestic retirement order"  means  a  domestic  retirement
31    order  which creates or recognizes the existence of an alternate payee's right
32    or assigns to an alternate payee the right to all or a portion of the  accrued
33    benefits  of a member under the retirement system, which directs the system to
34    establish a segregated account or disburse benefits to an alternate payee, and
35    which the executive director of the retirement system has determined meets the
36    requirements of sections 59-1319 and 59-1320, Idaho Code.
37        (5C)  "Average monthly salary" means the member's  average  salary  during
38    the  base  period  as  calculated  pursuant to rules adopted by the retirement
39    board.
40        (5D)  (a)  "Base period" means the period of fifty-four  (54)  consecutive
41        calendar months during which the member earned:
42             (i)   The highest average salary; and
43             (ii)  Membership  service  of  at  least one-half (1/2) the number of


 1             months in the period, excluding months of service attributable to:
 2                  A.  Military service;
 3                  B.  Service qualifying as minimum benefit  pursuant  to  section
 4                  59-1342(5), Idaho Code; and
 5                  C.  Worker's compensation income benefits.
 6        (b)  Effective  October  1, 1993, the consecutive calendar months shall be
 7        forty-eight (48). Effective October  1,  1994,  the  consecutive  calendar
 8        months shall be forty-two (42).
 9        (c)  Entitlement  to a base period shall not vest until the effective date
10        of that base period. The retirement benefits shall be  calculated  on  the
11        amounts, terms and conditions in effect at the date of the final contribu-
12        tion by the member.
13        (d)  If  no  base period exists for a member, the member's average monthly
14        salary shall be determined by the board, using standards not  inconsistent
15        with those established in this subsection.
16        (e)  To  assure  equitable  treatment  for  all members, salary increments
17        inconsistent with usual compensation patterns may  be  disallowed  by  the
18        board in determining average monthly salary and base period.
19        (6)  "Beneficiary" means the person who is nominated by the written desig-
20    nation  of  a  member,  duly executed and filed with the board, to receive the
21    death benefit.
22        (7)  "Calendar year" means twelve (12) calendar months commencing  on  the
23    first day of January.
24        (8)  "Credited  service"  means the aggregate of membership service, prior
25    service and disabled service.
26        (9)  "Date of establishment" means July 1, 1965, or a  later  date  estab-
27    lished by the board or statute.
28        (10) "Death benefit" means the amount, if any, payable upon the death of a
29    member.
30        (11) "Disability retirement allowance" means the periodic payment becoming
31    payable  upon  an active member's ceasing to be an employee while eligible for
32    disability retirement.
33        (12) "Disabled" means:
34        (a)  That the member is prevented  from  engaging  in  any  occupation  or
35        employment for remuneration or profit as a result of bodily injury or dis-
36        ease,  either occupational or nonoccupational in cause, but excluding dis-
37        abilities resulting from service in the armed forces of  any  country,  or
38        from an intentionally self-inflicted injury; and
39        (b)  That  the  member will likely remain so disabled permanently and con-
40        tinuously during the remainder of the member's life.
41     It is not necessary that a person be  absolutely  helpless  or  entirely
42    unable to do anything worthy of compensation to be considered disabled. If the
43    person  is  so  disabled  that substantially all the avenues of employment are
44    reasonably closed to the person, that  condition  is  within  the  meaning  of
45    "disabled."  In evaluating whether a person is disabled, medical factors
46    and  nonmedical factors including, but not limited to, education, economic and
47    social environment, training and usable skills may be considered.
48        Refusal to submit to a medical examination ordered by the board before the
49    commencement of a disability retirement allowance or at  any  reasonable  time
50    thereafter  shall  constitute proof that the member is not disabled. The board
51    shall be empowered to select for such medical examination one (1) or more phy-
52    sicians or surgeons who are licensed to practice medicine and perform surgery.
53    The fees and expenses of such examination shall be paid from  the  administra-
54    tion account of the fund. No member shall be required to undergo such examina-
55    tion more often than once each year after he has received a disability retire-


 1    ment allowance continuously for two (2) years.
 2        (12A) "Disabled  service"  means the total number of months  elapsing
 3    from   beginning   the first day  of the month next suc-
 4    ceeding   after  the final contribution of a member prior  to
 5    receiving  a  disability retirement allowance  to   and ending
 6     the first day of the month following the date of  termination  of  such
 7    disability  retirement  allowance. During such period, the member shall remain
 8    classified in the membership category held during the month of final contribu-
 9    tion. The total number of months of disabled service  credited  for  a  person
10    first  becoming  disabled  after  the effective date of this chapter shall not
11    exceed the excess, if any, of three hundred sixty (360) over the total  number
12    of months of prior service and membership service.
13        (12B) "Domestic  retirement  order"  means any judgment, decree, or order,
14    including approval of a property settlement agreement  which  relates  to  the
15    provision of marital property rights to a spouse or former spouse of a member,
16    and  is  made  pursuant  to  a domestic relations law, including the community
17    property law of the state of Idaho or of another state.
18        (13) "Early retirement allowance" means the periodic payment becoming pay-
19    able upon an active member's ceasing to be  an  employee  while  eligible  for
20    early retirement.
21        (14) (A)  "Employee" means:
22        (a)  Any  person who normally works twenty (20) hours or more per week for
23        an employer or a school  teacher  who  works  half-time  or  more  for  an
24        employer  and who receives salary for services rendered for such employer;
25        or
26        (b)  Elected officials or appointed officials of an employer who receive a
27        salary; or
28        (c)  A person who is separated from service with less than five  (5)  con-
29        secutive  months  of employment and who is reemployed or reinstated by the
30        same employer within thirty (30) days.
31        (B)  "Employee" does not include employment as:
32        (a)  A person rendering service to an employer in the capacity of an inde-
33        pendent business, trade or profession; or
34        (b)  A person whose employment with any employer does not total  five  (5)
35        consecutive months; or
36        (c)  A  person  provided  sheltered  employment  or  made-work by a public
37        employer in an employment or industries program maintained for the benefit
38        of such person; or
39        (d)  An inmate of a state institution, whether or not receiving  compensa-
40        tion for services performed for the institution; or
41        (e)  A  student  enrolled  in  an  undergraduate, graduate, or vocational-
42        technical program at and employed by a state college,  university,  commu-
43        nity college or vocational-technical center when such employment is predi-
44        cated on student status; or
45        (f)  A person making contributions to the United States civil service com-
46        mission under the United States Civil Service System Retirement Act except
47        that  a  person who receives separate remuneration for work currently per-
48        formed for an employer and the United States government may elect to be  a
49        member of the retirement system in accordance with rules of the board; or
50        (g)  A person occupying a position that does not exceed eight (8) consecu-
51        tive  months  in  a  calendar  year with a city or county when the city or
52        county has certified, in writing to the system, the position is  (i)  sea-
53        sonal  or  casual;  and  (ii)  affected by weather and the growing season,
54        including parks and golf course positions.
55        (15) "Employer" means the state of Idaho, or any political subdivision  or


 1    governmental  entity,  provided such subdivision or entity has elected to come
 2    into the system. Governmental entity means any organization composed of  units
 3    of  government of Idaho or organizations funded only by government or employee
 4    contributions or organizations who discharge governmental responsibilities  or
 5    proprietary  responsibilities that would otherwise be performed by government.
 6    All governmental entities are deemed to be political subdivisions for the pur-
 7    pose of this chapter.
 8        (15A) "Final contribution" means the final contribution made by  a  member
 9    pursuant to sections 59-1331 through 59-1334, Idaho Code.
10        (16) "Firefighter" means an employee, including paid firefighters hired on
11    or  after  October 1, 1980, whose primary occupation is that of preventing and
12    extinguishing fires as determined by the rules of the board.
13        (17) "Fiscal year" means the period beginning on July 1 in  any  year  and
14    ending on June 30 of the next succeeding year.
15        (18) "Fund"  means the public employee retirement fund established by this
16    chapter.
17        (19) "Funding agent" means any bank or banks, trust company or trust  com-
18    panies,  legal  reserve life insurance company or legal reserve life insurance
19    companies, or combinations thereof, any thrift institution or credit union  or
20    any   investment  management firm or individual investment manager selected by
21    the board to hold and/or invest the employers' and members' contributions  and
22    pay certain benefits granted under this chapter.
23        (20) "Inactive member" means a former active member who is not an employee
24    and  is not receiving any form of retirement allowance, but for whom a separa-
25    tion benefit has not become payable.
26        (20A) "Lifetime annuity" means periodic monthly payments of income by  the
27    retirement system to an alternate payee.
28        (20B) "Lump  sum distribution" means a payment by the retirement system of
29    the entire balance in the alternate payee's segregated account, together  with
30    regular interest credited thereon.
31        (21) "Member" means an active member, inactive member or a retired member.
32        (22) "Membership  service"  means  military service which occurs after the
33    commencement of contributions payable under sections 59-1331 through  59-1334,
34    Idaho  Code, and service with respect to which contributions are payable under
35    sections 59-1331 through 59-1334, Idaho Code, which, except for benefit calcu-
36    lations described in sections 59-1342 and 59-1353, Idaho Code,  includes  ser-
37    vice transferred to a segregated account under an approved domestic retirement
38    order.
39        (23) "Military  service"  means active duty service in the armed forces of
40    the United States including the national guard and reserves, under the  provi-
41    sions  of title 10, title 32, and title 37, United States code. Provided, how-
42    ever, for the purposes of this chapter, military service SHALL NOT include:
43        (a)  Any period ended by dishonorable discharge or during  which  termina-
44        tion of such service is available but not accepted;
45        (b)  Any  period which commences more than ninety (90) days after the per-
46        son ceases to be an employee or ends more than ninety (90) days before the
47        person again becomes an employee unless such ninety (90) day  requirements
48        are  waived  by  the board due to circumstances beyond the employee's con-
49        trol; or
50        (c)  Any active duty service in excess of five (5) years if at the  conve-
51        nience  of the United States government, or in excess of four (4) years if
52        not at the convenience of the United States government.
53        (24)  (a) "Police officer" for retirement purposes shall be as defined  in
54        section 59-1303, Idaho Code.
55        (b)  "POST"  means  the Idaho peace officer standards and training council


 1        established in chapter 51, title 19, Idaho Code.
 2        (25) "Prior service" means any period prior to July 1, 1965,  of  military
 3    service  or  of employment for the state of Idaho or any political subdivision
 4    or other employer of each employee who is an active member or in military ser-
 5    vice or on leave of absence on the date of establishment,  provided,  however,
 6    an employee who was not an active member or in military service or on leave of
 7    absence  on  the  date  of establishment shall receive credit for the member's
 8    service prior to July 1, 1965, on the basis of recognizing two (2)  months  of
 9    such  service for each month of membership service. For the purpose of comput-
10    ing such service, no deduction shall be made  for  any  continuous  period  of
11    absence from service or military service of six (6) months or less.
12        (26) "Regular  interest"  means interest at the rate set from time to time
13    by the board.
14        (27) "Retired member" means a former active member receiving a  retirement
15    allowance.
16        (28) "Retirement"  means  the  acceptance  of a retirement allowance under
17    this chapter upon termination of employment.
18        (29) "Retirement board" or "board" means the board provided  for  in  sec-
19    tions 59-1304 and 59-1305, Idaho Code, to administer the retirement system.
20        (30) "Retirement  system" or "system" means the public employee retirement
21    system of Idaho.
22        (31) (A)  "Salary" means:
23        (a)  The total salary or wages paid to a person who meets  the  definition
24        of  employee  by an employer for  personal services performed and reported
25        by the employer for income tax purposes, including the cash value  of  all
26        remuneration in any medium other than cash.
27        (b)  The  total  amount  of any voluntary reduction in salary agreed to by
28        the member and employer where the reduction is used as an alternative form
29        of remuneration to the member.
30        (B)  Salary in excess of the compensation limitations set forth in section
31    401(a)(17) of the Internal Revenue Code shall be disregarded  for  any  person
32    who becomes a member of the system on or after July 1, 1996. The system had no
33    limitations  on compensation in effect on July 1, 1993. The compensation limi-
34    tations set forth in section 401(1)(17) of the Internal Revenue Code shall not
35    apply for an "eligible employee." For purposes of this  subsection,  "eligible
36    employee" is an individual who was a member of the system before July 1, 1996.
37        (C)  "Salary" does not include:
38        (a)  Contributions by employers to employee held medical savings accounts,
39        as those accounts are defined in section 63-3022K, Idaho Code.
40        (b)  Lump  sum payments inconsistent with usual compensation patterns made
41        by the employer to the employee only upon termination from service includ-
42        ing, but not limited to,  vacation  payoffs,  sick  leave  payoffs,  early
43        retirement incentive payments and bonuses.
44        (31A) "Segregated account" means the account established by the retirement
45    system  for  the  alternate  payee of a member who is not a retired member. It
46    shall include the months of credited  service  and  accumulated  contributions
47    transferred from the member's account.
48        (32) "Separation benefit" means the amount, if any, payable upon or subse-
49    quent to separation from service.
50        (33) "Service"  means  being shown on an employer's payroll as an employee
51    receiving a salary. Service of fifteen (15) days or more during  any  calendar
52    month  shall be credited as one (1) month of service. Service of fourteen (14)
53    days or less during any calendar month shall not be credited. No more than one
54    (1) month of service shall be credited for all service in any month.
55        (34) "Service retirement allowance" means the  periodic  payment  becoming


 1    payable  upon  an active member's ceasing to be an employee while eligible for
 2    service retirement.
 3        (35) "State" means the state of Idaho.
 4        (36) "Vested retirement allowance" means  the  periodic  payment  becoming
 5    payable upon an inactive member's becoming eligible for vested retirement.
 6        (37) The masculine pronoun, wherever used, shall include the feminine pro-
 7    noun.

Statement of Purpose / Fiscal Impact

                      STATEMENT  OF  PURPOSE
     This bill relates to disability retirement under PERSI.  Until
1993, the PERSI disability standard set forth in section 59-1302(13), Idaho Code, clearly expressed a total and permanent
disability standard.  In 1993, additional language was added to the
definition, not to change the standard, but to give the board more
flexibility in applying the standard.  Unfortunately, this change
also unintentionally affected the standard and created ambiguity
about the level of disability required to be eligible for
disability retirement.  This bill strikes language added in 1993
which created the ambiguity, clarifying that disability retirement
under the PERSI standard requires total and permanent disability. 
It also clarifies the definition of "disabled service" to assure
that service is not lost between active service and disabled
                         FISCAL  IMPACT
Name:     Alan Winkle
Agency:   Public Employee Retirement System of Idaho
Phone:    334-2455

Statement of Purpose/Fiscal Impact                             H 2