HB 4574 Text

H. B. 4574

(By Delegate Lane)
[Introduced February 15, 2006; referred to the
Committee on Pensions and Retirement then Finance.]

A BILL to amend and reenact §7-14D-7, §7-14D-11 and §7-14D-12 of the Code of West Virginia, 1931, as amended, all relating to increasing deputy sheriffs' pension benefit by one-half of one percent, while increasing the employer contribution by one percent.

Be it enacted by the Legislature of West Virginia:
That §7-14D-7, §7-14D-11 and §7-14D-12 of the Code of West Virginia, 1931, as amended, be amended and reenacted, all to read as follows:
ARTICLE 14D. DEPUTY SHERIFF RETIREMENT SYSTEM ACT.
§7-14D-7. Members' contributions; employer contributions.
(a) There shall be deducted from the monthly salary of each member and paid into the fund an amount equal to eight and one-half percent of his or her monthly salary. An additional amount shall be paid to the fund by the county commission of the county in which the member is employed in covered employment in an amount determined by the board: Provided, That beginning with the first day of July, two-thousand six, the board shall increase each county commission's contribution to the fund by one-percent: Provided, however, That in no year may the total of the contributions provided in this section, to be paid by the county commission, exceed ten and one-half percent of the total payroll for the members in the employ of the county commission for the preceding fiscal year. If the board finds that the benefits provided by this article can be actually funded with a lesser contribution, then the board shall reduce the required member or employer contributions or both. The sums withheld each calendar month shall be paid to the fund no later than fifteen days following the end of the calendar month.
(b) Any active member who has concurrent employment in an additional job or jobs and the additional employment requires the deputy sheriff to be a member of another retirement system which is administered by the Consolidated Public Retirement Board pursuant to article ten-d, chapter five of this code shall make an additional contribution to the fund of eight and one-half percent of his or her monthly salary earned from any additional employment which requires the deputy sheriff to be a member of another retirement which is administered by the Consolidated Public Retirement Board pursuant to article ten-d, chapter five of this code. An additional amount shall be paid to the fund by the concurrent employer for which the member is employed in an amount determined by the board: Provided, That beginning with the first day of July, two-thousand six, the board shall increase each concurrent employer's contribution to the fund by one-percent: Provided, however, That in no year may the total of the contributions provided in this section, to be paid by the concurrent employer, exceed ten and one-half percent of the monthly salary of the employee. If the board finds that the benefits provided by this article can be funded with a lesser contribution, then the board shall reduce the required member or employer contributions or both. The sums withheld each calendar month shall be paid to the fund no later than fifteen days following the end of the calendar month.
§7-14D-11. Retirement benefits.
This section provides for the adjustment of a member's accrued benefit to reflect the difference in age, in years and months, between the member's annuity starting date and the date the member attains normal retirement age. This age adjustment shall be made based upon the normal form of benefit and shall be the actuarial equivalent of the accrued benefit at the member's normal retirement age. The member shall receive the age adjusted retirement income in the normal form or in an actuarial equivalent amount in an optional form as provided under section twelve of this chapter. The first day of the calendar month of birth shall be used in lieu of any birth date that does not fall on the first day of a calendar month.
(a) Normal retirement. -- A member whose annuity starting date is the date the member attains normal retirement age, is entitled to his or her accrued benefit without adjustment for age at commencement. To the extent that a member's starting date is later than his or her normal retirement age, the amount of that member's retirement income benefit shall be adjusted as provided in subsection (c) of this section.
(b) Early retirement. -- A member who ceases covered employment and has attained early retirement age while in covered employment may elect to receive retirement income payments commencing on the first day of the month coincident with or following the date the member ceases covered employment. "Normal retirement age" for such a member is the first day of the calendar month coincident with or next following the month in which the member attains the age of fifty years. If the member's annuity starting date is prior to the date the member attains normal retirement age, his or her accrued benefit is reduced to the actuarial equivalent benefit amount based on the years and months by which his or her annuity starting date precedes the date he or she attains normal retirement age. If the member's annuity starting date is later than the date the member attains the age of fifty years, the accrued benefit is adjusted as provided in subsection (c) of this section.
(c) Late retirement. -- A member whose annuity starting date is later than the date the member attains normal retirement age shall receive retirement income payments in the normal form which is the actuarial equivalent of the benefit to which he or she would have been entitled had the retirement income payments commenced at the member's normal retirement age.
(d) Retirement benefits shall be paid monthly in an amount equal to one twelfth of the retirement income payments elected and at those times established by the board. Notwithstanding any other provision of the plan, a member who is married on the annuity starting date will receive his or her retirement income payments in the form of a sixty-~~six and two-thirds~~ seven and one-sixth percent joint and survivor annuity with his or her spouse unless prior to the annuity starting date the spouse waives the form of benefit.
§7-14D-12. Annuity options.
Prior to the effective date of retirement, but not thereafter, a member may elect to receive retirement income payments in the normal form, or the actuarial equivalent of the normal form from the following options:
(a) Option A -- Joint and Survivor Annuity. -- A life annuity payable during the joint lifetime of the member and his or her beneficiary who is a natural person with an insurable interest in the member's life. Upon the death of either the member or his or her beneficiary, the benefit shall continue as a life annuity to the survivor in an amount equal to fifty and one-half percent, sixty-~~six and two-thirds~~ seven and one sixth percent, seventy-five and one-half percent or one hundred percent of the amount paid while both were living as selected by the member. If the retiring member is married, the spouse shall sign a waiver of benefit rights if the beneficiary is to be other than the spouse.
(b) Option B -- Contingent Joint and Survivor Annuity. -- A life annuity payable during the joint lifetime of the member and his or her beneficiary who must be a natural person with an insurable interest in the member's life. Upon the death of the member, the benefit shall continue as a life annuity to the beneficiary in an amount equal to fifty and one-half percent, sixty-~~six and two-thirds~~ seven and one sixth percent, seventy-five and one-half percent or one hundred percent of the amount paid while both were living as selected by the member. If the beneficiary dies first, the monthly amount of benefits may not be reduced, but shall be paid at the amount that was in effect before the death of the beneficiary. If the retiring member is married, the spouse shall sign a waiver of benefit rights if the beneficiary is to be other than the spouse.
(c) Option C -- Ten Years Certain and Life Annuity. -- A life annuity payable during the member's lifetime but in any event for a minimum of ten years. If the member dies before the expiration of ten years, the remaining payments shall be made to a designated beneficiary, if any, or otherwise to the member's estate.
(d) Option D -- Level Income Annuity. -- A life annuity payable monthly in an increased amount "A" from the time of retirement until the member is social security retirement age, and then a lesser amount "B" payable for the member's lifetime thereafter, with these amounts computed actuarially to satisfy the following two conditions:
(1) Actuarial equivalence. -- The actuarial present value at the date of retirement of the member's annuity if taken in the normal form must equal the actuarial present value of the term life annuity in amount "A" plus the actual present value of the deferred life annuity in amount "B"; and
(2) Level income. -- The amount "A" equals the amount "B" plus the amount of the member's estimated monthly social security primary insurance amount that would commence at the date amount "B" becomes payable. For this calculation, the primary insurance amount is estimated when the member applies for retirement, using social security law then in effect, using assumptions established by the board.
In the case of a member who has elected the options set forth in subdivisions (a) and (b) of this section, respectively, and whose beneficiary dies prior to the member's death, the member may name an alternative beneficiary. If an alternative beneficiary is named within eighteen months following the death of the prior beneficiary, the benefit shall be adjusted to be the actuarial equivalent of the benefit the member is receiving just after the death of the member's named beneficiary. If the election is not made until eighteen months after the death of the prior beneficiary, the amount shall be reduced so that it is only ninety and one-half percent of the actuarial equivalent of the benefit the member is receiving just after the death of the member's named beneficiary.

NOTE: The purpose of this bill is to increase deputy sheriffs' pension benefit by one-half percent, while increasing the employer contribution by one percent.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.

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