H. B. 4565
(By Mr. Speaker, Mr. Kiss, and
Delegates
Michael and Ashley)
[Introduced February 25, 1998; referred to the
Committee on Pensions and Retirement then Finance.]
A BILL to amend and reenact section eleven, article seven-b,
chapter eighteen of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to the
teachers' defined contribution retirement system; and
authorizing transfer of service credit and retirement
account to the public employees retirement system if a
member's employment is terminated with a participating
employer and the member is later employed by a state agency.
Be it enacted by the Legislature of West Virginia:
That section eleven, article seven-b, chapter eighteen of
the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted to read as follows:
ARTICLE 7B. TEACHERS' DEFINED CONTRIBUTION RETIREMENT SYSTEM.
§18-7B-11. Termination of membership.
Any member whose employment with a participating employer terminates after the completion of six complete years of
employment service shall be eligible to terminate his or her
annuity account and receive a distribution from the member's
annuity account, in an amount equal to the member's contribution
plus one third of the employer contributions and any earnings
thereon. Any member whose employment with a participating
employer terminates after the completion of nine complete years
of employment service shall be eligible to terminate his or her
annuity account and receive a distribution from the member's
annuity account, in an amount equal to the member's contribution
plus two thirds of the employer's contributions and any earnings
thereon. Any member whose employment with a participating
employer terminates after the completion of twelve complete years
of employment service shall be eligible to terminate his or her
annuity account and receive a distribution of all funds
contributed and accumulated in his or her annuity account. Any
member whose employment with a participating employer terminates
prior to the completion of six complete years of employment
service shall be eligible to terminate his or her annuity account
and receive a distribution from the member's annuity account, in
an amount equal to the member's contribution plus any earnings
thereon:
Provided, That on the death or permanent, total
disability of any member, that member shall be eligible to
terminate his or her annuity account and receive all funds contributed to or accumulated in his or her annuity account.
The remaining balance, if any, in the member's account after
the distribution shall be remitted and paid into a suspension
account, hereby created, to be administered by the board. The
board shall promulgate rules regarding the distribution of any
balance in the special account created by this section:
Provided, That any funds in the account shall be used solely for
the purpose of reducing employer contributions in future years.
Any account balances remitted to the suspension account
herein shall be maintained by the board in
said the suspension
account in the name of the terminated employee for a period of
five years following initial remittance to the suspension
account. For each
said terminated employee at the culmination of
the aforesaid five-year period, the board shall certify in
writing to each contributing employer the amount of the account
balances plus earnings thereon attributable to each separate
contributing employers previously terminated employees' accounts
which have been irrevocably forfeited due to the elapse of a
five-year period since termination pursuant to section sixteen of
this article.
Upon certification to the several contributing employers of
the aggregate account balances plus earnings thereon which have
been irrevocably forfeited pursuant to this section, the several
contributing employers shall be permitted in the next succeeding fiscal year or years to reduce their total aggregate contribution
requirements pursuant to section seventeen of this article, for
the then current fiscal year by an amount equal to the aggregate
amounts irrevocably forfeited and certified as such to each
contributing employer.
Upon the utilization of the amounts irrevocably forfeited to
any contributing employer as a reduction in the then current
fiscal year contribution obligation and upon notification
provided by the several contributing employers to the board of
their intention to utilize irrevocably forfeited amounts, the
board shall direct the distribution of
said the irrevocably
forfeited amounts from the suspension account to be deposited on
behalf of the contributing employer to the member annuity
accounts of its then current employees pursuant to section
seventeen of this article.
If a member's membership in the defined contribution system
terminates and the member is then transferred to or later
employed by a state agency, the member may transfer the service
time and retirement account, including all contributions made to
that account by both the member and employer, from the defined
contribution system to the public employees retirement system and
shall receive full credit towards retirement for the service
earned as a member of the defined contribution system.
NOTE: The purpose of this bill is to permit the transfer of service credit and retirement account to the public employees
retirement system from the teachers' defined contribution
retirement system if a member's employment is terminated with a
participating employer in the defined contribution system and
that person is transferred to or later employed by a state
agency.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.