TITLE 59

PUBLIC OFFICERS IN GENERAL

CHAPTER 13

PUBLIC EMPLOYEE RETIREMENT SYSTEM

59-1309.  Allocation of extraordinary gains. (1) At the close of each fiscal year, the board shall determine whether the fund has experienced extraordinary gains. If extraordinary gains exist the board may allocate all or part of them as set forth in this section. In determining whether extraordinary gains should be allocated, the board shall exercise its fiduciary discretion.

(2)  Extraordinary gains are defined as the excess, if any, at the close of the fiscal year of plan assets over the plan’s accrued actuarially determined liabilities plus a sum necessary to absorb a one (1) standard deviation market event without increasing contribution rates, as determined by the board.

(3)  If the board determines that extraordinary gains should be allocated, the gains shall be allocated to retirees, to active members, and to employers in such proportion as determined by the board. The board shall determine no later than the first day of December following the close of the fiscal year the amount of extraordinary gains to be allocated, if any.

(4)  Retirees shall receive their allocation in the form of a one-time payment made in addition to their regular monthly benefit payments. For purposes of this section, "retirees" include retired members, members receiving a disability retirement allowance, contingent annuitants, and surviving spouses who elected the annuity option under section 59-1361(5), Idaho Code. To participate in the retiree allocation, a retiree must be receiving a regular monthly allowance at the close of the fiscal year and on the date of distribution. The retiree allocation shall be distributed proportionally based on the final monthly retirement allowance of the fiscal year divided by the total of all monthly retirement allowances paid for the same month. The date of distribution shall be no later than the first day of February following the close of the fiscal year.

(5)  Active members shall receive their allocation as a transfer of funds to a supplemental retirement account established by the board. Funds transferred to or held in supplemental retirement accounts shall be accounted for separately and shall not be considered in determining any other benefits under this chapter. To participate in the active member allocation, the member must have been an active member on the last day of the fiscal year and have accrued at least twelve (12) months of service on that date. Any member who has withdrawn contributions from the fund prior to the date of transfer is not eligible to receive a transfer under this section. The active member allocation shall be distributed proportionally based on accumulated contributions at the close of the fiscal year divided by the total accumulated contributions of all active members at the close of the fiscal year, not to exceed the amount that would result by applying the limits imposed by rule or by section 415(c)(1) of the Internal Revenue Code to compensation earned during the fiscal year. The transfer of funds shall occur in the following calendar year but shall be subject to reduction and forfeiture, based on the application of limits imposed by rule or by section 415 of the Internal Revenue Code for that year.

(6)  Employers shall receive their allocation as a credit against future contributions required by section 59-1325, Idaho Code. Credits are not available to any employer who has withdrawn from participation in the fund prior to the transfer date. The employer allocation shall be credited proportionally based on employer contribution liability accrued during the fiscal year as provided in section 59-1322, Idaho Code, divided by the total employer contribution liability for the fiscal year. The credits shall be established no later than the first day of February following the close of the fiscal year. The credits shall be applied thereafter in the same manner as provided in section 59-1325, Idaho Code, until exhausted. If, after twelve (12) months of remittances, an employer’s credits have not been exhausted, and the employer has not withdrawn from participation in the fund, the value of the remaining credits shall carry over to the next year, together with an interest payment equal to regular interest on the remaining credits.

History:

[59-1309, added 2000, ch. 208, sec. 2, p. 531.]