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S1084aaH....................................by COMMERCE AND HUMAN RESOURCES
EDUCATION BOARD - Amends existing law to authorize the State Board of
Education to set up and regulate deferred compensation programs for certain
eligible employees; and to provide rulemaking authority.
02/07 Senate intro - 1st rdg - to printing
02/10 Rpt prt - to Com/HuRes
03/13 Rpt out - rec d/p - to 2nd rdg
03/14 2nd rdg - to 3rd rdg
03/17 3rd rdg - PASSED - 32-0-3
AYES -- Andreason, Bailey, Brandt, Bunderson, Burkett, Burtenshaw,
Calabretta, Cameron, Compton, Darrington, Gannon, Geddes, Goedde,
Hill, Ingram, Kennedy, Keough, Little, Lodge, Malepeai, McKenzie,
McWilliams, Noble, Noh, Pearce, Richardson, Schroeder, Stegner,
Stennett, Sweet, Werk, Williams
NAYS -- None
Absent and excused -- Davis, Marley, Sorensen
Floor Sponsor - Cameron
Title apvd - to House
03/19 House intro - 1st rdg - to Com/HuRes
03/27 Rpt out - to Gen Ord
03/28 Rpt out amen - to 1st rdg as amen
03/31 1st rdg - to 2nd rdg as amen
04/01 2nd rdg - to 3rd rdg as amen
04/02 3rd rdg as amen - PASSED - 65-1-4
AYES -- Andersen, Barraclough, Barrett, Bauer, Bell, Bieter, Black,
Block, Boe, Bolz, Bradford, Campbell, Cannon, Clark, Collins, Crow,
Cuddy, Deal, Denney, Douglas, Eberle, Edmunson, Ellsworth, Eskridge,
Field(18), Field(23), Gagner, Garrett, Harwood, Henbest, Jaquet,
Jones, Kellogg, Lake, Langford, Langhorst, Martinez, McGeachin,
McKague, Meyer, Miller, Mitchell, Moyle, Naccarato, Nielsen,
Raybould, Ridinger, Ring, Ringo, Roberts, Robison, Rydalch, Sali,
Sayler, Schaefer, Shepherd, Shirley, Skippen, Smith(30), Smylie,
Snodgrass, Tilman, Wills, Wood, Mr. Speaker
NAYS -- Kulczyk
Absent and excused -- Bedke, Smith(24), Stevenson, Trail
Floor Sponsor - Schaefer
Title apvd - to Senate
04/03 Senate concurred in House amens - to engros
04/04 Rpt engros - 1st rdg - to 2nd rdg as amen
04/07 2nd rdg - to 3rd rdg as amen
04/09 3rd rdg as amen - PASSED - 34-0-1
AYES -- Andreason, Bailey, Brandt, Bunderson, Burkett, Burtenshaw,
Calabretta, Cameron, Compton, Darrington, Davis, Gannon, Geddes,
Goedde, Hill, Ingram, Kennedy, Keough, Little, Lodge, Malepeai(Kumm),
Marley, McKenzie, McWilliams, Noh, Pearce, Richardson, Schroeder,
Sorensen, Stegner, Stennett, Sweet, Werk, Williams
NAYS -- None
Absent and excused -- Noble
Floor Sponsor - Cameron
Title apvd - to enrol
04/10 Rpt enrol - Pres signed
04/14 Sp signed
04/15 To Governor
04/21 Governor signed
Session Law Chapter 305
Effective: 07/01/06 or upon termination/
expiration of current deferred compensation
plan administration agreement whichever
occurs first with special consideration for
rules that may be adopted by the State Board
of Education
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
IN THE SENATE
SENATE BILL NO. 1084
BY COMMERCE AND HUMAN RESOURCES COMMITTEE
1 AN ACT
2 RELATING TO DEFERRED COMPENSATION PROGRAMS; AMENDING SECTION 59-513, IDAHO
3 CODE, TO AUTHORIZE THE STATE BOARD OF EDUCATION TO SET UP AND REGULATE
4 DEFERRED COMPENSATION PROGRAMS FOR CERTAIN ELIGIBLE EMPLOYEES, TO PROVIDE
5 RULEMAKING AUTHORITY AND TO PROVIDE CORRECT TERMINOLOGY.
6 Be It Enacted by the Legislature of the State of Idaho:
7 SECTION 1. That Section 59-513, Idaho Code, be, and the same is hereby
8 amended to read as follows:
9 59-513. DEFERRED COMPENSATION PROGRAMS FOR EMPLOYEES OF STATE OR POLITI-
10 CAL SUBDIVISIONS. The state of Idaho, the state board of education for those
11 employees eligible for participation in the optional retirement programs cre-
12 ated in sections 33-107A and 33-107B, Idaho Code, and any county, city, or
13 political subdivision of the state acting through its governing body, is
14 hereby authorized to contract with an employee to defer all or a portion of
15 that employee's income, and may subsequently with the consent of the employee,
16 invest such deferred income in a funding medium for the purpose of funding a
17 deferred compensation program for the employee.
18 The state board of examiners shall supervise and regulate the deferred
19 compensation program for state employees, and may adopt rules to implement
20 such a program; provided however, that the state board of education shall
21 supervise and regulate any deferred compensation program it establishes and
22 may adopt rules to implement such a program.
23 The governing body of any county, city, or political subdivision of the
24 state, shall supervise and regulate the deferred compensation program for its
25 employees.
26 In no event shall the amount of income an employee elects to defer exceed
27 the total annual salary, or compensation under the existing salary schedule or
28 classification plan applicable to such employee in such year. Any income
29 deferred under such a plan shall continue to be included as regular compensa-
30 tion for the purpose of computing the retirement contributions and pension
31 benefits earned by any employee, but any sum so deferred shall not be included
32 in the computation of any income taxes withheld on behalf of any such
33 employee.
34 Coverage of an employee under a deferred compensation plan under this sec-
35 tion shall not render such employee ineligible for simultaneous membership and
36 participation in the pension systems for public employees which are otherwise
37 provided for.
38 For the purposes of this act section the state controller is authorized to
39 make such deductions from salary for any employee of the state who has autho-
40 rized such deductions in writing, and the state board of examiners may desig-
41 nate administrative agents for the state of Idaho to execute all necessary
42 agreements pertaining to the deferred compensation program.
43 For the purposes of this act section, the term "employee" includes elected
2
1 or appointed officials.
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
Moved by Lake
Seconded by Schaefer
IN THE HOUSE OF REPRESENTATIVES
HOUSE AMENDMENT TO S.B. NO. 1084
1 AMENDMENT TO THE BILL
2 On page 2 of the printed bill, following line 1, insert:
3 "SECTION 2. This act shall be in full force and effect on and after Janu-
4 ary 1, 2006, or upon the termination or expiration of the existing restated
5 and amended deferred compensation plan administration agreement implementing
6 the provisions of section 59-513, Idaho Code, whichever occurs first. Provided
7 however, that the State Board of Education may adopt rules to implement the
8 provisions of this act on and after July 1, 2003, so long as such rules do not
9 permit the implementation to occur prior to the effective date of this act.".
10 CORRECTION TO TITLE
11 On page 1, in line 5, following "TERMINOLOGY" insert: "; AND PROVIDING AN
12 EFFECTIVE DATE".
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
IN THE SENATE
SENATE BILL NO. 1084, As Amended in the House
BY COMMERCE AND HUMAN RESOURCES COMMITTEE
1 AN ACT
2 RELATING TO DEFERRED COMPENSATION PROGRAMS; AMENDING SECTION 59-513, IDAHO
3 CODE, TO AUTHORIZE THE STATE BOARD OF EDUCATION TO SET UP AND REGULATE
4 DEFERRED COMPENSATION PROGRAMS FOR CERTAIN ELIGIBLE EMPLOYEES, TO PROVIDE
5 RULEMAKING AUTHORITY AND TO PROVIDE CORRECT TERMINOLOGY; AND PROVIDING AN
6 EFFECTIVE DATE.
7 Be It Enacted by the Legislature of the State of Idaho:
8 SECTION 1. That Section 59-513, Idaho Code, be, and the same is hereby
9 amended to read as follows:
10 59-513. DEFERRED COMPENSATION PROGRAMS FOR EMPLOYEES OF STATE OR POLITI-
11 CAL SUBDIVISIONS. The state of Idaho, the state board of education for those
12 employees eligible for participation in the optional retirement programs cre-
13 ated in sections 33-107A and 33-107B, Idaho Code, and any county, city, or
14 political subdivision of the state acting through its governing body, is
15 hereby authorized to contract with an employee to defer all or a portion of
16 that employee's income, and may subsequently with the consent of the employee,
17 invest such deferred income in a funding medium for the purpose of funding a
18 deferred compensation program for the employee.
19 The state board of examiners shall supervise and regulate the deferred
20 compensation program for state employees, and may adopt rules to implement
21 such a program; provided however, that the state board of education shall
22 supervise and regulate any deferred compensation program it establishes and
23 may adopt rules to implement such a program.
24 The governing body of any county, city, or political subdivision of the
25 state, shall supervise and regulate the deferred compensation program for its
26 employees.
27 In no event shall the amount of income an employee elects to defer exceed
28 the total annual salary, or compensation under the existing salary schedule or
29 classification plan applicable to such employee in such year. Any income
30 deferred under such a plan shall continue to be included as regular compensa-
31 tion for the purpose of computing the retirement contributions and pension
32 benefits earned by any employee, but any sum so deferred shall not be included
33 in the computation of any income taxes withheld on behalf of any such
34 employee.
35 Coverage of an employee under a deferred compensation plan under this sec-
36 tion shall not render such employee ineligible for simultaneous membership and
37 participation in the pension systems for public employees which are otherwise
38 provided for.
39 For the purposes of this act section the state controller is authorized to
40 make such deductions from salary for any employee of the state who has autho-
41 rized such deductions in writing, and the state board of examiners may desig-
42 nate administrative agents for the state of Idaho to execute all necessary
43 agreements pertaining to the deferred compensation program.
2
1 For the purposes of this act section, the term "employee" includes elected
2 or appointed officials.
3 SECTION 2. This act shall be in full force and effect on and after Janu-
4 ary 1, 2006, or upon the termination or expiration of the existing restated
5 and amended deferred compensation plan administration agreement implementing
6 the provisions of section 59-513, Idaho Code, whichever occurs first. Provided
7 however, that the State Board of Education may adopt rules to implement the
8 provisions of this act on and after July 1, 2003, so long as such rules do not
9 permit the implementation to occur prior to the effective date of this act.
STATEMENT OF PURPOSE
RS12816
Relating to employee benefits, this legislation authorizes the State
Board of Education to create a deferred compensation plan for employees
of Idaho Colleges and Universities. Changes to the federal tax laws
enacted in 2001 permit employees to save additional amounts from their
compensation for retirement by combining a 403(b) tax-deferred annuity
plan with a 457(b) deferred compensation plan. Access to a 457 plan is
therefore more beneficial than ever for higher education employees, who
have largely utilized existing 403(b) savings vehicles. Higher
education has its own defined contribution retirement plan for faculty
and administrators and its own 403(b) voluntary savings plans. It is
therefore consistent with existing practice for the institutions to
offer their own 457 deferred compensation plan. Allowing higher
education institutions the flexibility to choose providers for their
own 457 deferred compensation plan will permit them to offer many of
their employees the opportunity to consolidate their retirement savings
with the provider of their choice. For example, a faculty member who
participates in the Optional Retirement Program (ORP) and who makes
voluntary contributions to a 403(b) offered by their chosen ORP
provider could contribute to a 457 deferred compensation vehicle
offered by the same provider. Employees would be afforded the
opportunity to continue saving for retirement with a provider they know
and trust. A higher education 457 deferred compensation plan would be
offered in addition to the existing state 457 plan, not in lieu of the
existing state plan. Many public higher education institutions around
the country are implementing their own 457 deferred compensation plans.
FISCAL IMPACT
There is no fiscal impact to the general fund or to local government.
The deferred compensation plan would be operated in conjunction with
the State Board of Education Optional Retirement plan for University
and College faculty and professional staff.
CONTACT
Name: Mike Brassey
Phone: 336-7930
Name: Ken McClure
Phone: 388-1200
STATEMENT OF PURPOSE/FISCAL IMPACT S 108