View Bill Status
View Bill Text
View Statement of Purpose / Fiscal Impact
S1256.......................................by COMMERCE AND HUMAN RESOURCES PUBLIC EMPLOYEE RETIREMENT SYSTEM - Amends existing law relating to the Public Employee Retirement System to revise the definition of "employee." 01/30 Senate intro - 1st rdg - to printing 02/02 Rpt prt - to Com/HuRes 02/16 Rpt out - rec d/p - to 2nd rdg 02/17 2nd rdg - to 3rd rdg 02/24 3rd rdg - PASSED - 33-0-2 AYES -- Andreason, Bailey, Brandt, Bunderson, Burkett, Burtenshaw, Calabretta, Cameron, Compton, Darrington, Davis, Gannon, Geddes, Goedde, Ingram, Kennedy, Keough, Little, Lodge, Malepeai, Marley, McKenzie, McWilliams, Noble, Noh, Pearce, Schroeder, Sorensen, Stegner, Stennett, Sweet, Werk, Williams NAYS -- None Absent and excused -- Hill, Richardson Floor Sponsor - Malepeai Title apvd - to House 02/25 House intro - 1st rdg - to Com/HuRes 03/10 Rpt out - rec d/p - to 2nd rdg 03/11 2nd rdg - to 3rd rdg 03/15 3rd rdg - PASSED - 59-0-11 AYES -- Andersen, Barraclough, Barrett, Bauer, Bayer, Block, Boe, Bolz, Bradford, Campbell, Cannon, Clark, Collins, Cuddy, Deal, Denney, Douglas, Eberle, Edmunson, Ellsworth, Eskridge, Field(18), Field(23), Gagner, Garrett, Harwood, Henbest, Jones, Kellogg, Kulczyk, Lake, Langford, Langhorst, Martinez, McGeachin, McKague, Meyer, Miller, Mitchell, Naccarato, Nielsen, Pasley-Stuart, Ring, Ringo, Robison, Rydalch, Sali, Sayler, Schaefer, Shepherd, Shirley, Skippen, Smith(30), Smith(24), Smylie, Snodgrass, Trail, Wills, Wood NAYS -- None Absent and excused -- Bedke, Bell, Black, Crow, Jaquet, Moyle, Raybould, Ridinger, Roberts, Stevenson, Mr. Speaker Floor Sponsor - Martinez Title apvd - to Senate 03/16 To enrol 03/17 Rpt enrol - Pres signed 03/18 Sp signed 03/19 To Governor 03/24 Governor signed Session Law Chapter 294 Effective: 07/01/04
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-seventh Legislature Second Regular Session - 2004 IN THE SENATE SENATE BILL NO. 1256 BY COMMERCE AND HUMAN RESOURCES COMMITTEE 1 AN ACT 2 RELATING TO THE PUBLIC EMPLOYEE RETIREMENT SYSTEM; AMENDING SECTION 59-1302, 3 IDAHO CODE, TO REVISE THE DEFINITION OF "EMPLOYEE." 4 Be It Enacted by the Legislature of the State of Idaho: 5 SECTION 1. That Section 59-1302, Idaho Code, be, and the same is hereby 6 amended to read as follows: 7 59-1302. DEFINITIONS. (1) As used in this chapter, each of the terms 8 defined in this section shall have the meaning given in this section unless a 9 different meaning is clearly required by the context. 10 (2) "Active member" means any employee who is not establishing the right 11 to receive benefits through his or her employer's participation in any other 12 retirement system established for Idaho public employees, if such participa- 13 tion is mandated by applicable Idaho statutes other than this chapter. In no 14 case will an employee be entitled to any benefit under this chapter for public 15 service if such employee is establishing retirement benefit entitlements by 16 other Idaho statutes or federal statutes other than military service or social 17 security for that same service. 18 (3) "Accumulated contributions" means the sum of amounts contributed by a 19 member of the system, together with regular interest credit thereon. 20 (4) "Actuarial equivalent" means a benefit equal in value to another ben- 21 efit, when computed upon the basis of the actuarial tables in use by the sys- 22 tem. 23 (5) "Actuarial tables" means such tables as shall have been adopted by 24 the board in accordance with recommendations of the actuary. 25 (5A) "Alternate payee" means a spouse or former spouse of a member who is 26 recognized by an approved domestic retirement order as having a right to all 27 or a portion of the accrued benefits in the retirement system with respect to 28 such member. 29 (5B) "Approved domestic retirement order" means a domestic retirement 30 order which creates or recognizes the existence of an alternate payee's right 31 or assigns to an alternate payee the right to all or a portion of the accrued 32 benefits of a member under the retirement system, which directs the system to 33 establish a segregated account or disburse benefits to an alternate payee, and 34 which the executive director of the retirement system has determined meets the 35 requirements of sections 59-1319 and 59-1320, Idaho Code. 36 (5C) "Average monthly salary" means the member's average salary during 37 the base period as calculated pursuant to rules adopted by the retirement 38 board. 39 (5D) (a) "Base period" means the period of fifty-four (54) consecutive 40 calendar months during which the member earned: 41 (i) The highest average salary; and 42 (ii) Membership service of at least one-half (1/2) the number of 43 months in the period, excluding months of service attributable to: 2 1 A. Military service; 2 B. Service qualifying as minimum benefit pursuant to section 3 59-1342(5), Idaho Code; and 4 C. Worker's compensation income benefits. 5 (b) Effective October 1, 1993, the consecutive calendar months shall be 6 forty-eight (48). Effective October 1, 1994, the consecutive calendar 7 months shall be forty-two (42). 8 (c) Entitlement to a base period shall not vest until the effective date 9 of that base period. The retirement benefits shall be calculated on the 10 amounts, terms and conditions in effect at the date of the final contribu- 11 tion by the member. 12 (d) If no base period exists for a member, the member's average monthly 13 salary shall be determined by the board, using standards not inconsistent 14 with those established in this subsection. 15 (e) To assure equitable treatment for all members, salary increments 16 inconsistent with usual compensation patterns may be disallowed by the 17 board in determining average monthly salary and base period. 18 (6) "Beneficiary" means the person who is nominated by the written desig- 19 nation of a member, duly executed and filed with the board, to receive the 20 death benefit. 21 (7) "Calendar year" means twelve (12) calendar months commencing on the 22 first day of January. 23 (7A) "Contingent annuitant" means the person designated by a member under 24 certain retirement options to receive benefit payments upon the death of the 25 member. The person so designated must be born and living on the effective date 26 of retirement. 27 (8) "Credited service" means the aggregate of membership service, prior 28 service and disabled service. 29 (9) "Date of establishment" means July 1, 1965, or a later date estab- 30 lished by the board or statute. 31 (10) "Death benefit" means the amount, if any, payable upon the death of a 32 member. 33 (11) "Disability retirement allowance" means the periodic payment becoming 34 payable upon an active member's ceasing to be an employee while eligible for 35 disability retirement. 36 (12) "Disabled" means: 37 (a) That the member is prevented from engaging in any occupation or 38 employment for remuneration or profit as a result of bodily injury or dis- 39 ease, either occupational or nonoccupational in cause, but excluding dis- 40 abilities resulting from service in the armed forces of any country, or 41 from an intentionally self-inflicted injury; and 42 (b) That the member will likely remain so disabled permanently and con- 43 tinuously during the remainder of the member's life. 44 It is not necessary that a person be absolutely helpless or entirely unable to 45 do anything worthy of compensation to be considered disabled. If the person is 46 so disabled that substantially all the avenues of employment are reasonably 47 closed to the person, that condition is within the meaning of "disabled." In 48 evaluating whether a person is disabled, medical factors and nonmedical fac- 49 tors including, but not limited to, education, economic and social environ- 50 ment, training and usable skills may be considered. 51 Refusal to submit to a medical examination ordered by the board before the 52 commencement of a disability retirement allowance or at any reasonable time 53 thereafter shall constitute proof that the member is not disabled. The board 54 shall be empowered to select for such medical examination one (1) or more phy- 55 sicians or surgeons who are licensed to practice medicine and perform surgery. 3 1 The fees and expenses of such examination shall be paid from the administra- 2 tion account of the fund. No member shall be required to undergo such examina- 3 tion more often than once each year after he has received a disability retire- 4 ment allowance continuously for two (2) years. 5 (12A) "Disabled service" means the total number of months elapsing from 6 the first day of the month next succeeding the final contribution of a member 7 prior to receiving a disability retirement allowance to the first day of the 8 month following the date of termination of such disability retirement allow- 9 ance. During such period, the member shall remain classified in the membership 10 category held during the month of final contribution. The total number of 11 months of disabled service credited for a person first becoming disabled after 12 the effective date of this chapter shall not exceed the excess, if any, of 13 three hundred sixty (360) over the total number of months of prior service and 14 membership service. 15 (12B) "Domestic retirement order" means any judgment, decree, or order, 16 including approval of a property settlement agreement which relates to the 17 provision of marital property rights to a spouse or former spouse of a member, 18 and is made pursuant to a domestic relations law, including the community 19 property law of the state of Idaho or of another state. 20 (13) "Early retirement allowance" means the periodic payment becoming pay- 21 able upon an active member's ceasing to be an employee while eligible for 22 early retirement. 23 (14) (A) "Employee" means: 24 (a) Any person who normally works twenty (20) hours or more per week for 25 an employer or a school teacher who works half-time or more for an 26 employer and who receives salary for services rendered for such employer; 27 or 28 (b) Elected officials or appointed officials of an employer who receive a 29 salary; or 30 (c) A person who is separated from service with less than five (5) con- 31 secutive months of employment and who is reemployed or reinstated by the 32 same employer within thirty (30) days. 33 (B) "Employee" does not include employment as: 34 (a) A person rendering service to an employer in the capacity of an inde- 35 pendent business, trade or profession; or 36 (b) A person whose employment with any employer does not total five (5) 37 consecutive months; or 38 (c) A person provided sheltered employment or made-work by a public 39 employer in an employment or industries program maintained for the benefit 40 of such person; or 41 (d) An inmate of a state institution, whether or not receiving compensa- 42 tion for services performed for the institution; or 43 (e) A student enrolled in an undergraduate, graduate, or professional- 44 technical program at and employed by a state college, university, commu- 45 nity college or professional-technical center when such employment is 46 predicated on student status; or 47 (f) A person making contributions to the United States civil service com- 48 mission under the United States Civil Service System Retirement Act except 49 that a person who receives separate remuneration for work currently per- 50 formed for an employer and the United States government may elect to be a 51 member of the retirement system in accordance with rules of the board; or 52 (g) A person occupying a position that does not exceed eight (8) consecu- 53 tive months in a calendar year with a city or county when the city or 54 county has certified, in writing to the system, the position is (i) sea- 55 sonal or casual; and (ii) affected by weather and the growing season, 4 1 including parks and golf course positions; or 2 (h) A person in a position that (i) is eligible for participation in an 3 optional retirement program established under section 33-107A or 33-107B, 4 Idaho Code, or (ii) would be eligible for participation in an optional 5 retirement program established under section 33-107A or 33-107B, Idaho 6 Code, if the person was not working less than half-time or less than 7 twenty (20) hours per week. 8 (15) "Employer" means the state of Idaho, or any political subdivision or 9 governmental entity, provided such subdivision or entity has elected to come 10 into the system. Governmental entity means any organization composed of units 11 of government of Idaho or organizations funded only by government or employee 12 contributions or organizations who discharge governmental responsibilities or 13 proprietary responsibilities that would otherwise be performed by government. 14 All governmental entities are deemed to be political subdivisions for the pur- 15 pose of this chapter. 16 (15A) "Final contribution" means the final contribution made by a member 17 pursuant to sections 59-1331 through 59-1334, Idaho Code. 18 (16) "Firefighter" means an employee, including paid firefighters hired on 19 or after October 1, 1980, whose primary occupation is that of preventing and 20 extinguishing fires as determined by the rules of the board. 21 (17) "Fiscal year" means the period beginning on July 1 in any year and 22 ending on June 30 of the next succeeding year. 23 (18) "Fund" means the public employee retirement fund established by this 24 chapter. 25 (19) "Funding agent" means any bank or banks, trust company or trust com- 26 panies, legal reserve life insurance company or legal reserve life insurance 27 companies, or combinations thereof, any thrift institution or credit union or 28 any investment management firm or individual investment manager selected by 29 the board to hold and/or invest the employers' and members' contributions and 30 pay certain benefits granted under this chapter. 31 (20) "Inactive member" means a former active member who is not an employee 32 and is not receiving any form of retirement allowance, but for whom a separa- 33 tion benefit has not become payable. 34 (20A) "Lifetime annuity" means periodic monthly payments of income by the 35 retirement system to an alternate payee. 36 (20B) "Lump sum distribution" means a payment by the retirement system of 37 the entire balance in the alternate payee's segregated account, together with 38 regular interest credited thereon. 39 (21) "Member" means an active member, inactive member or a retired member. 40 (22) "Membership service" means military service which occurs after the 41 commencement of contributions payable under sections 59-1331 through 59-1334, 42 Idaho Code, and service with respect to which contributions are payable under 43 sections 59-1331 through 59-1334, Idaho Code, which, except for benefit calcu- 44 lations described in sections 59-1342 and 59-1353, Idaho Code, includes ser- 45 vice transferred to a segregated account under an approved domestic retirement 46 order. 47 (23) "Military service" means active duty service in the armed forces of 48 the United States including the national guard and reserves, under the provi- 49 sions of title 10, title 32, and title 37, United States code. Provided, how- 50 ever, for the purposes of this chapter, military service SHALL NOT include: 51 (a) Any period ended by dishonorable discharge or during which termina- 52 tion of such service is available but not accepted; 53 (b) Any period which commences more than ninety (90) days after the per- 54 son ceases to be an employee or ends more than ninety (90) days before the 55 person again becomes an employee unless such ninety (90) day requirements 5 1 are waived by the board due to circumstances beyond the employee's con- 2 trol; or 3 (c) Any active duty service in excess of five (5) years if at the conve- 4 nience of the United States government, or in excess of four (4) years if 5 not at the convenience of the United States government. 6 (24) (a) "Police officer" for retirement purposes shall be as defined in 7 section 59-1303, Idaho Code. 8 (b) "POST" means the Idaho peace officer standards and training council 9 established in chapter 51, title 19, Idaho Code. 10 (25) "Prior service" means any period prior to July 1, 1965, of military 11 service or of employment for the state of Idaho or any political subdivision 12 or other employer of each employee who is an active member or in military ser- 13 vice or on leave of absence on the date of establishment, provided, however, 14 an employee who was not an active member or in military service or on leave of 15 absence on the date of establishment shall receive credit for the member's 16 service prior to July 1, 1965, on the basis of recognizing two (2) months of 17 such service for each month of membership service. For the purpose of comput- 18 ing such service, no deduction shall be made for any continuous period of 19 absence from service or military service of six (6) months or less. 20 (26) "Regular interest" means interest at the rate set from time to time 21 by the board. 22 (27) "Retired member" means a former active member receiving a retirement 23 allowance. 24 (28) "Retirement" means the acceptance of a retirement allowance under 25 this chapter upon termination of employment. 26 (29) "Retirement board" or "board" means the board provided for in sec- 27 tions 59-1304 and 59-1305, Idaho Code, to administer the retirement system. 28 (30) "Retirement system" or "system" means the public employee retirement 29 system of Idaho. 30 (31) (A) "Salary" means: 31 (a) The total salary or wages paid to a person who meets the definition 32 of employee by an employer for personal services performed and reported 33 by the employer for income tax purposes, including the cash value of all 34 remuneration in any medium other than cash. 35 (b) The total amount of any voluntary reduction in salary agreed to by 36 the member and employer where the reduction is used as an alternative form 37 of remuneration to the member. 38 (B) Salary in excess of the compensation limitations set forth in section 39 401(a)(17) of the Internal Revenue Code shall be disregarded for any person 40 who becomes a member of the system on or after July 1, 1996. The system had no 41 limitations on compensation in effect on July 1, 1993. The compensation limi- 42 tations set forth in section 401(a)(17) of the Internal Revenue Code shall not 43 apply for an "eligible employee." For purposes of this subsection, "eligible 44 employee" is an individual who was a member of the system before July 1, 1996. 45 (C) "Salary" does not include: 46 (a) Contributions by employers to employee held medical savings accounts, 47 as those accounts are defined in section 63-3022K, Idaho Code. 48 (b) Lump sum payments inconsistent with usual compensation patterns made 49 by the employer to the employee only upon termination from service includ- 50 ing, but not limited to, vacation payoffs, sick leave payoffs, early 51 retirement incentive payments and bonuses. 52 (31A) "Segregated account" means the account established by the retirement 53 system for the alternate payee of a member who is not a retired member. It 54 shall include the months of credited service and accumulated contributions 55 transferred from the member's account. 6 1 (32) "Separation benefit" means the amount, if any, payable upon or subse- 2 quent to separation from service. 3 (33) "Service" means being shown on an employer's payroll as an employee 4 receiving a salary. For each calendar month, service is credited only when a 5 member is an employee as defined in subsection (14)(A) of this section and is 6 employed for fifteen (15) days or more during the calendar month. Employment 7 of fourteen (14) days or less during any calendar month shall not be credited. 8 No more than one (1) month of service shall be credited for all service in any 9 month. 10 (34) "Service retirement allowance" means the periodic payment becoming 11 payable upon an active member's ceasing to be an employee while eligible for 12 service retirement. 13 (35) "State" means the state of Idaho. 14 (36) "Vested member" means an active or inactive member who has at least 15 five (5) years of credited service, except that a member, who at the time of 16 his separation from service: 17 (a) Held an office to which he had been elected by popular vote or having 18 a term fixed by the constitution, statute or charter or was appointed to 19 such office by an elected official; or 20 (b) Was the head or director of a department, division, agency, statutory 21 section or bureau of the state; or 22 (c) Was employed on or after July 1, 1965, by an elected official of the 23 state of Idaho and occupied a position exempt from the provisions of chap- 24 ter 53, title 67, Idaho Code; and 25 (d) Was not covered by a merit system for employees of the state of 26 Idaho, 27 is vested without regard to the length of credited service. 28 (37) The masculine pronoun, wherever used, shall include the feminine pro- 29 noun.
STATEMENT OF PURPOSE RS 13464 This bill clarifies an eligibility issue created by the interplay between PERSI and the Optional Retirement Plans (ORPs) of universities. Because of the way "employee" is defined in Idaho Code 59-1302(14), it is possible for ORP covered employment to be counted toward PERSI eligibility in cases of dual employment. This means that a person could be eligible for PERSI with one employer even if they work less than 20 hours for that employer. This creates administrative problems because there is no practical way for that employer to track hours with the ORP covered employer. This bill would amend PERSI section 59-1302(14) to clarify that ORP covered employment cannot be considered in reaching eligibility requirements for PERSI covered employment. FISCAL IMPACT None CONTACT Name: Alan H. Winkle Agency: Public Employees Retirement System Phone: 334-2455 Statement of Purpose/Fiscal Impact S 1256