COMMITTEE SUBSTITUTE
FOR
COMMITTEE SUBSTITUTE
FOR
Senate Bill No. 667
(By Senators Foster, Plymale, Jenkins and Minard)
____________
[Originating in the Committee on Finance;
reported February 22, 2008.]
____________
A BILL to amend and reenact §8-22-16, §8-22-17, §8-22-19, §8-22-20,
§8-22-20a, §8-22-22, §8-22-22a, §8-22-23a,§8-22-26a and §8-22-
27 of the Code of West Virginia, 1931, as amended; to amend
said code by adding thereto two new sections, designated §8-
22-18a and §8-22-18b; to amend said code by adding a new
section, designated §33-2-15e; and to amend and reenact §33-3-
14d and §33-3-33 of said code, all relating to municipal
policemen's and firemen's pension and relief funds; amending
calculation of overtime for compensation and average adjusted
salary for new employees; requiring additional duties of fund
trustees; creating the West Virginia Municipal Pensions
Oversight Board; specifying powers, duties, liabilities and
compensation of oversight board members; requiring reporting
on local pension funds' investment returns; creating the West
Virginia Municipal Pensions Security Fund; transferring certain duties from the State Treasurer to the oversight board
and providing for efficient transition; requiring municipal
contributions on a monthly basis; requiring deposits of
certain revenues within five days of receipt; increasing
employee contributions to the pension and relief funds for new
employees to nine and one-half percent of salary and providing
for increased contribution from current members based on
actuary's recommendation; requiring increased contributions to
receive certain insurance premium tax revenues; setting times
for deposits; requiring certain payments by electronic funds
transfer; reducing time to qualify for insurance premium tax
revenues from three years to eighteen months; providing for
annual actuarial report, for periodic review of the actuarial
process and for periodic actuarial audit; setting minimum
standards for annual municipality contributions to pension
funds; establishing target funding ratios of eighty, ninety
and one hundred percent of unfunded liabilities; requiring
municipal contributions based on demographic and investment
experience; eliminating alternative funding method; defining
terms; providing for contract actuary; requiring report;
authorizing local pension boards of trustees to investment
with the state Investment Management Board and Board of
Treasury Investments; requiring compliance with the Uniform
Prudent Investor Act; amending authorized investments;
requiring reporting of municipal board's investment policy;
requiring reporting of fees and transactions costs; providing for disability examinations; restricting access by examining
physician to prior disability examination reports; requiring
completion of investigation of charge and implementation of
disciplinary action by board of trustees prior to
consideration of disability retirement; authorizing light-duty
work at discretion of the municipality and the employee;
requiring reports on disability retirements; clarifying
supplemental benefits; defining solvency; clarifying military
service credit; requiring study by insurance commissioner;
reallocating revenues from the additional fire and casualty
insurance premium tax and returning surcharge on fire and
casualty insurance policies to one percent to benefit
municipal policemen's and firemen's pensions and relief funds;
providing for deposits into Municipal Pensions Security Fund
and for transfer of duties to Municipal Pensions Oversight
Board; providing for interest; requiring information sharing;
establishing minimum standards for employer contributions to
plans funded at one hundred ten percent or more; restricting
premium tax revenue to plans funded less than one hundred ten
percent of accrued liability; providing for disbursement by
Insurance Commissioner; providing for interest; providing for
retention and investment of certain funds from insurance
policy surcharge for five years for the benefit of municipal
policemen's and firemen's pension and relief funds; setting
requirements to qualify for insurance premium surcharge
proceeds; providing for distribution; and setting dates.
Be it enacted by the Legislature of West Virginia:
That §8-22-16, §8-22-17, §8-22-19, §8-22-20, §8-22-20a,
§8-22-22, §8-22-22a, §8-22-23a, §8-22-26a and §8-22-27 of the Code
of West Virginia, 1931, as amended, be amended and reenacted; that
said code be amended by adding thereto two new sections, designated
§8-22-18a and §8-22-18b; that said code be amended by adding
thereto a new section, designated §33-2-15e; and that §33-3-14d and
§33-3-33 of said code be amended and reenacted, all to read as
follows:
CHAPTER 8. MUNICIPAL CORPORATIONS.
ARTICLE 22. RETIREMENT BENEFITS GENERALLY; POLICEMEN'S PENSION
AND RELIEF FUND; FIREMEN'S PENSION AND RELIEF
FUND; PENSION PLANS FOR EMPLOYEES OF WATERWORKS
SYSTEM, SEWERAGE SYSTEM OR COMBINED WATERWORKS AND
SEWERAGE SYSTEM.
PART III. POLICEMEN'S PENSION AND RELIEF FUND; FIREMEN'S
PENSION AND RELIEF FUND.
§8-22-16. Pension and relief funds for policemen and firemen;
creation of boards of trustees; definitions;
continuance of funds; average adjusted salary.
(a) In every Class I and Class II city having, or which may
hereafter have, a paid police department and a paid fire
department, or either of such departments, the governing body
shall, and in every Class III city and Class IV town or village
having, or which may hereafter have, a paid police department and
a paid fire department, or either of such departments, the governing body may, by ordinance provide for the establishment and
maintenance of a policemen's pension and relief fund and for a
firemen's pension and relief fund for the purposes hereinafter
enumerated and, thereupon, there shall be created boards of
trustees which shall administer and distribute the moneys
authorized to be raised by this section and the following sections
of this article. For the purposes of this section and sections
seventeen through twenty-eight, inclusive, of this article, the
term "paid police department" or "paid fire department" means only
a municipal police department or municipal fire department, as the
case may be, maintained and paid for out of public funds and whose
employees are paid on a full-time basis out of public funds. The
term shall not be taken to mean any such department whose employees
are paid nominal salaries or wages or are only paid for services
actually rendered on an hourly basis.
(b) Unless and until other provision is made by subsequent
legislative action, any policemen's pension and relief fund and any
firemen's pension and relief fund established in accordance with
the provisions of former article six of this chapter or this
article shall be or remain mandatory and shall be governed by the
provisions of sections sixteen through twenty-eight, inclusive, of
this article (with like effect, in the case of a Class III city or
Class IV town or village, as if such Class III city or Class IV
town or village were a Class I or Class II city) and shall not be
affected by the transition from one class of municipal corporation
to a lower class as specified in section three, article one of this chapter:
Provided, That any Class III or Class IV town or village
that hereafter becomes a Class I or Class II city shall not be
required to establish such pension and relief fund if said town or
village is a participant in an existing pension plan regarding paid
firemen and/or policemen.
(c) After the thirtieth day of June, one thousand nine hundred
eighty-one, for the purposes of sections sixteen through
twenty-eight, inclusive, of this article, the word "member" means
any paid police officer or firefighter who at time of appointment
to such paid police or fire department met the medical requirements
of Chapter 2-2 of the National Fire Protection Association
Standards Number 1001 -- Firefighters Professional Qualifications
'74 as updated from year to year:
Provided, That any police
officer or firefighter who was a member of
such the fund prior to
the first day of July, one thousand nine hundred eighty-one, shall
be considered a member after June thirtieth, one thousand nine
hundred eighty-one.
(d) For purposes of sections sixteen through twenty-eight,
inclusive, of this article, the words "salary or compensation"
means remuneration actually received by a member, plus
such the
member's deferred compensation under Sections 125, 401(k),
414(h)(2) and 457 of the United States Internal Revenue Code of
1986, as amended:
Provided, That the remuneration received by
such
the member during any twelve-consecutive-month period
utilized used
in determining benefits which is in excess of an amount which is
twenty percent greater than the "average adjusted salary" received by
such the member in the two consecutive twelve-consecutive-month
periods immediately preceding
such the twelve-consecutive-month
period
utilized used in determining benefits shall be disregarded:
Provided, however, That the "average adjusted salary" means the
arithmetic average of each year's adjusted salary,
such the
adjustment made to reflect current salary rate and such average
adjusted salary shall be determined as follows: Assuming "year-
one" means the second twelve-consecutive-month period preceding
such twelve-consecutive-month period
utilized used in determining
benefits, "year-two" means the twelve-consecutive-month period
immediately preceding such twelve-consecutive-month period
utilized
used in determining benefits and "year-three" means the twelve-
consecutive-month period
utilized used in determining benefits,
year-one total remuneration shall be multiplied by the ratio of
year-three base salary, exclusive of all overtime and other
remuneration, to year-one base salary, exclusive of all overtime
and other remuneration, such product shall equal "year-one adjusted
salary"; year-two total remuneration shall be multiplied by the
ratio of year-three base salary, exclusive of all overtime and
other remuneration, to year-two base salary, exclusive of all
overtime and other remuneration, such product shall equal "year-two
adjusted salary"; and the arithmetic average of year-one adjusted
salary and year-two adjusted salary shall equal the average
adjusted salary.
Notwithstanding other provisions of this code,
for members hired after the thirtieth day of June, two thousand
eight, calculation of compensation and average adjusted salary for purposes of sections sixteen through twenty-eight, inclusive, of
this article shall exclude from total remuneration in each of year
one, year two and year three any remuneration for overtime hours in
excess of the average number of overtime hours worked during the
last ten years of the member's employment as a police officer or
firefighter while a member of the fund, or the average number of
overtime hours worked annually during all years of the person's
employment as a municipal police officer or firefighter while a
member of the fund if the member has worked less than ten years.
§8-22-17. Powers and duties of boards of trustees.
Such board of trustees, or (a) Boards of trustees shall be
public corporations by the name and style of the Board of Trustees
of the Policemen's Pension and Relief Fund of (name of
municipality) or the Board of Trustees of the Firemen's Pension and
Relief Fund of (name of municipality), as the case may be, by which
names they may sue and be sued, plead and be impleaded, contract
and be contracted with, take and hold real and personal property
for the use of
said the policemen's pension and relief fund or
said
the firemen's pension and relief fund and have and use a common
seal. In the absence of
such a seal, the seal of the president of
any such the corporation shall be equivalent to
such a common seal.
Any such A board of trustees may also in its corporate name do and
perform any and all other acts and business pertaining to the trust
created hereby or by any conveyance, devise or dedication made for
the uses and purposes of
said the board.
(b) After the thirtieth day of June, one thousand nine hundred eighty-one, any
such board of trustees
boards of trustees and any
members
thereof of a board shall, as fund fiduciaries, discharge
their duties with respect to
such pension and relief funds solely
in the interest of the members and members' beneficiaries for the
exclusive purpose of providing benefits to members and their
beneficiaries and defraying reasonable expenses of administering
the fund.
(c) The board of trustees of each fund shall deliver a copy of
the fund's current rules, regulations and procedures to the
oversight board created in section eighteen-a of this article on
the first day of July, two thousand eight, and thereafter within
thirty days of any approved change in the rules, regulations or
procedures.
(d) Each member of a board of trustees shall attend training
in matters relating to trustee duties as shall be required by the
oversight board pursuant to section eighteen-a of this article.
§8-22-18a. West Virginia Municipal Pensions Oversight Board
created.
(a)(1) There is created, effective the first day of April, two
thousand eight, the West Virginia Municipal Pensions Oversight
Board for the purpose of monitoring and improving the performance
of municipal policemen's and firemen's pension and relief funds to
assure prudent administration, investment and management of the
funds. Management of the board shall be vested solely in the
members of the oversight board. Duties of the board shall include,
but not be limited to, assisting municipal boards of trustees in
performing their duties, assuring the funds' compliance with
applicable laws, providing for actuarial studies, distributing tax revenues to the funds, initiating or joining legal actions on
behalf of active or retired pension fund members or municipal
boards of trustees to protect interests of the members in the
funds, and taking other actions as reasonably necessary to provide
for the security and fiscal integrity of the pension funds. The
oversight board's authority to initiate legal action does not
preempt the authority of municipalities, municipal policemen's and
firemen's boards of trustees or pension fund active or retired
members to initiate legal action to protect interests in the funds.
The oversight board is created as a public body corporate.
Creation of the oversight board does not relieve the municipal
funds' boards of trustees from their fiduciary and other duties to
the funds, nor does it create any liability for the funds on the
part of the state. Members and employees of the oversight board
are not liable personally, either jointly or severally, for debts
or obligations of the municipal pension and relief funds. Members
and employees of the oversight board have a fiduciary duty toward
the municipal pension and relief funds and are liable for
misfeasance or gross negligence.
(2) The board shall consist of seven voting members and two
nonvoting exofficio members. The voting members shall be citizens
of the state, shall be qualified electors thereof for a period of
at least one year next preceding their appointment and shall be as
follows: An active or retired member of a municipal policemen's
pension and relief fund chosen from a list of three persons
submitted to the Governor by the state's largest professional
municipal police officers organization, an active or retired member
of a municipal firemen's pension and relief fund chosen from a list of three persons submitted to the Governor by the state's largest
professional firefighters organization, an attorney experienced in
finance and investment matters related to pensions management, two
persons experienced in pension funds management, one person who is
a certified public accountant experienced in auditing and one
person chosen from a list of three persons submitted to the
Governor by the state's largest association of municipalities.
(3) Upon the effective date of this section amended during the
two thousand eight regular legislative session, the Governor shall
forthwith appoint the voting members, with the advice and consent
of the Senate. The Governor may remove any voting member from the
board for neglect of duty, incompetency or official misconduct.
The chair of the Senate Committee on Pensions, or the chair's
designee, and the chair of the House of Delegates Committee on
Pensions and Retirement, or the chair's designee, shall serve as
nonvoting, exofficio members of the oversight board.
(b) The oversight board has the power to:
(1) Enter into contracts, to sue and be sued, to implead and
be impleaded;
(2) Promulgate and enforce bylaws and rules for the management
and conduct of its affairs;
(3) Maintain accounts and invest those funds which the
oversight board is charged with receiving and distributing;
(4) Make, amend and repeal bylaws, rules and procedures
consistent with the provisions of this article and article thirty-
three of this code;
(5) Not withstanding any other provision of law, retain or
employ, fix compensation, prescribe duties and pay expenses of legal, accounting, financial, investment, management and other
staff, advisors or consultants as it considers necessary. Expenses
shall be paid from the moneys in the Municipal Pensions Security
Fund created in section eighteen-b of this article or prior to the
transition provided in section eighteen-b of this article, the
Municipal Pensions and Protection Fund; and
(6) Do all things necessary and appropriate to implement and
operate the board in performance of its duties.
(c) The terms of board members shall be staggered initially
from the first day of July, two thousand eight. The Governor shall
appoint initially one member for a term of one year, one member for
a term of two years, two members for terms of three years, one
member for a term of four years and two members for terms of five
years. Subsequent appointments shall be for terms of five years.
A member having served two full consecutive terms may not be
reappointed for one year after completion of his or her second full
term. Each member shall serve until that member's successor is
appointed and qualified, unless the board member is no longer
competently performing the duties of office. Any vacancy on the
board shall be filled by appointment by the Governor for the
balance of the unexpired term. The Governor may remove members of
the board for cause.
(d) A majority of the full authorized voting membership of the
board constitutes a quorum. The board shall meet at least six
times a year, but more often as duties require, at times and places
that it determines. The board shall elect a chair person and a
vice chairperson from their membership who shall serve for terms of
two years and shall select annually a secretary/treasurer who may be either a member or employee of the board. The board shall
employ an executive director and other staff as needed and shall
fix their duties and compensation. The board shall pay all
personnel and other board expenses out of the Municipal Pensions
Security Fund created in section eighteen-b of this article.
Expenses during the initial year of the board's operation shall be
from proceeds of the Municipal Pensions Security Fund.
Expenditures in years thereafter shall be by appropriation from the
security fund. The board is exempt from the provisions of sections
seven and eleven, article three of chapter twelve of this code
relating to compensation and expenses of members, including travel
expenses, and is exempt from the provisions of article three,
chapter five-a of this code relating to the Purchasing Division of
the Department of Administration. The members and employees of the
board are subject to purchasing policies and procedures which shall
be promulgated by the board
: Provided, That the board shall award
contracts on a competitive basis. The purchasing policies and
procedures may be promulgated as emergency rules pursuant to
section fifteen, article three, chapter twenty-nine-a of this code.
(e) Each member of the board shall receive the same
compensation as is paid to members of the Legislature for their
interim duties as recommended by the Citizens Legislative
Compensation Commission and authorized by law for each day or
portion thereof engaged in the discharge of official duties:
Provided, That the representative of the municipalities shall not
receive compensation for service on the board if the representative
is a salaried employee of a municipality or the state's largest
association of municipalities and receives salary while attending meetings of the oversight board. Each member of the board is
entitled to reasonable reimbursement of travel and other necessary
expenses actually incurred while engaging in board activities. All
reimbursement of expenses shall be paid out of the Municipal
Pensions Security Fund.
(f) The board may contract with other state boards or state
agencies to share offices, personnel and other administrative
functions as authorized under this article.
(g) The board shall propose rules for legislative approval in
accordance with the provisions of article three, chapter
twenty-nine-a of this code as necessary to implement the provisions
of this article, and is authorized to promulgate emergency rules
pursuant to the provisions of section fifteen, article three,
chapter twenty-nine-a of this code.
(h) The oversight board shall report annually to the
Legislature's Joint Committee on Pensions and Retirement concerning
the status of municipal policemen's and firemen's pension and
relief funds and shall present recommendations for strengthening
and protecting the funds and the benefit interests of the funds'
members.
(I) The oversight board shall cooperate with the West Virginia
Investment Management Board and the board of Treasury Investments
to educate members of the local pension boards of trustees on the
services offered by the two state investment boards. No later than
the thirty-first day of October, two thousand eleven, the board
shall report to the joint committee on pensions and retirement a
detailed comparison of returns on long-term investments of moneys
held by or allocated to municipal pension and relief funds managed by the West Virginia Management Board and those managed by others
than the Investment Management Board. The oversight board shall
also report at that time on short-term investment returns by local
pension boards using the West Virginia Board of Treasury
Investments compared to short-term investment returns by those
local boards of trustees not using the board of Treasury
Investments.
(j) The oversight board shall establish minimum requirements
for training to be completed by each member of the board of
trustees of a municipal policemen's or firemen's pension and relief
fund. The requirements should include, but not be limited to,
training in ethics, fiduciary duty and investment responsibilities.
§8-22-18b. Creation of Municipal Pensions Security Fund; transfer
of certain powers, duties and functions of
Treasurer's office to Municipal Pensions Oversight
Board.
(a) The Legislature finds that an important part of oversight
of municipal policemen's and firemen's pension and relief funds is
monitoring the performance required of the various funds to qualify
to receive distribution of insurance premium tax revenues provided
by section fourteen-d and section thirty-three of article three,
chapter thirty-three of this code. That function is transferred
from the State Treasurer's office to the West Virginia Municipal
Pensions Oversight Board at the effective date of this section
:
Provided, That until the oversight board is fully organized and
operating, some duties and functions being performed by the State
Treasurer's office prior to the effective date of this legislation
may be continued by that office temporarily as necessary to effect an orderly transition of responsibilities and provide for prompt
distribution of the insurance premium tax proceeds to the municipal
funds.
(b) There is created in the State Treasury a nonexpiring
special revenue fund designated the West Virginia Municipal
Pensions Security Fund which shall be administered by the West
Virginia Municipal Pensions Oversight Board solely for the purposes
as provided in this article and article three, chapter thirty-three
of this code. All earnings shall accrue to and be retained by the
fund.
(c) Until such time as the oversight board advises the
Insurance Commissioner and the State Treasurer in writing that the
oversight board is prepared to receive into and distribute from the
West Virginia Municipal Pensions Security Fund premium tax revenues
as provided in sections fourteen-d and thirty-three, article three,
chapter thirty-three of this code, the commissioner shall continue
to transfer the funds into the Municipal Pensions and Protection
Fund and the State Treasurer shall continue to disburse funds to
the qualifying municipal pension and relief funds, and shall
disburse funds as necessary for the establishment and early
operation of the oversight board. The Insurance Commission, the
Treasurer's Office and oversight board shall share information
freely as required for efficient transfer of powers and duties
related to the premium tax revenues to be allocated to the
municipal policemen's and firemen's pension and relief funds. When
the oversight board assumes full responsibility to receive funds
into and disburse funds from the Municipal Pensions and Security
Fund, the State Treasurer shall transfer to it all funds remaining in the Municipal Pensions and Protection Fund and shall close the
fund.
§8-22-19. Levy to maintain fund.
(a)(1) The provisions of this subsection shall remain in
effect through the thirtieth day of June, one thousand nine hundred
eighty-three.
(2) In every municipality in which there is a policemen's
pension and relief fund or a firemen's pension and relief fund, or
both, the same shall be maintained as follows: The governing body
of the municipality shall levy annually and in the manner provided
by law for other municipal levies, and include within the maximum
levy or levies permitted by law, and if necessary in excess of any
charter provision, a tax at such rate as will, after crediting the
amount of the contributions received during such year from the
members of the respective paid police department or paid fire
department, provide funds equal to the sum of: (1) The full amount
of estimated expenditures of the boards of trustees of the
respective funds; and (2) an additional amount equal to ten percent
of the estimated expenditures, said ten percent amount to be taken,
accumulated and invested, if possible, as surplus reserve:
Provided, That in no event shall the levy for each of the
respective boards of trustees be less than one cent nor more than
eight cents on each one hundred dollars of all real and personal
property as listed for taxation in the municipality: Provided,
however, That in the event that the funds derived above are not
sufficient to meet the annual expenditures and the surplus reserve
funds for any fiscal year do not contain a sufficient balance to
maintain full retirement benefits for that fiscal year, the municipality shall for only that fiscal year levy an amount not to
exceed an additional two cents on each one hundred dollars of all
real and personal property listed for taxation in such
municipality: Provided further, That in the event that a
municipality is required to levy an amount for any fiscal year in
excess of eight cents on each one hundred dollars of all real and
personal property as provided above, the municipality shall assess
and collect for only that fiscal year from each member an
additional amount of one percent of the actual salary or
compensation for each one cent that the municipality has levied in
excess of the eight cents which shall become a required part of the
pension and relief fund to which the member belongs.
(3) The levies authorized under the provisions of this
section, or any part of them, may by the governing body be laid in
addition to all other municipal levies, and to that extent, beyond
the limit of levy imposed by the charter of the municipality; and
the levies shall supersede and if necessary exclude levies for
other purposes if priority or exclusion is necessary under
limitations upon taxes or tax levies imposed by law.
(4) The public corporations are authorized to take by gift,
grant, devise or bequest, any money or real or personal property,
upon such terms as to the investment and expenditures thereof as
may be fixed by the grantor or determined by the trustees.
(5) In addition to all other sums provided for pensions in
this section, it shall be the duty of every municipality in which
any policemen's pension and relief fund or firemen's pension and
relief fund or funds have been or shall be established to assess
and collect from each member of the paid police department or paid fire department or both each month, the sum of six percent of the
actual salary or compensation of the member; and the amount so
collected shall become a regular part of the policemen's pension
and relief fund, if collected from a policeman, and of the
firemen's pension and relief fund, if collected from a fireman.
(a) (1) (b) After the thirtieth day of June, one thousand nine
hundred eighty-three: In order for a municipal policemen's or
firemen's pension and relief fund to receive the allocable portion
of moneys from the municipal pensions and protection fund
established in section fourteen-d, article three, chapter
thirty-three of this code
and funds from the Municipal Pensions
Security Fund created in section eighteen-b of this article, the
governing body of the municipality shall levy annually and in the
manner provided by law for other municipal levies and include
within the maximum levy or levies permitted by law and, if
necessary, in excess of any charter provision, a tax at such rate
as will, after crediting: (A) The amount of the contributions
received during the year from the members of the respective paid
police department or paid fire department; and (B) the allocable
portion of the municipal pensions and protection fund established
in section fourteen-d, article three, chapter thirty-three of this
code
and funds from the Municipal Pensions Security Fund created in
section eighteen-b of this article, provide funds equal to the
amount necessary to meet the minimum standards for
actuarial
soundness annual municipality contributions to the fund as provided
in section twenty of this article.
The said amount
to shall be
irrevocably contributed, accumulated and invested as fund assets
described in sections twenty-one and twenty-two of this article.
One twelfth of the municipality each municipality's annual
contributions shall be deposited
with the municipality's pension
trust funds as fund assets on at least a
quarterly monthly basis
and any revenues received from any source by a municipality which
are specifically collected for the purpose of allocation for
deposit into the policemen's pension and relief fund or firemen's
pension and relief fund shall be so deposited within
thirty five
days of receipt by the municipality. Heretofore surplus reserves
accumulated before the
first day of July, one thousand nine hundred
eighty-three, effective date of this section shall be irrevocably
contributed, aggregated and invested as fund assets described in
sections twenty-one and twenty-two of this article. Any actuarial
deficiency arising under this section and section twenty of this
article shall not be the obligation of the State of West Virginia.
(2) The levies authorized under the provisions of this
section, or any part of them, may by the governing body be laid in
addition to all other municipal levies and, to that extent, beyond
the limit of levy imposed by the charter of the municipality; and
the levies shall supersede and if necessary exclude levies for
other purposes, where other purposes have not already attained
priority, and within the limitations upon taxes or tax levies
imposed by the Constitution and laws.
(3)(b) The public corporations are authorized to take by gift,
grant, devise or bequest any money or real or personal property
upon such terms as to the investment and expenditures thereof as
may be fixed by the grantor or determined by the trustees.
(4)(c) Notwithstanding provisions in section six of this
article, in addition to all other sums provided for pensions in this section, it is the duty of every municipality in which any
fund or funds have been or shall be established to assess and
collect from each member of the paid police department or paid fire
department or both each month, the sum of seven percent of the
actual salary or compensation of such member; and the amount so
collected shall become a regular part of the policemen's pension
and relief fund, if collected from a policeman, and of the
firemen's pension and relief fund, if collected from a fireman:
Provided, That for police officers and firefighters hired after the
thirtieth day of April, two thousand eight, the municipality shall
assess and collect nine and one-half percent of the actual salary
or compensation. For police officers and firefighters hired on or
before the thirtieth day of April, two thousand eight, each
municipality shall, in accordance with subsection (f), section
twenty-six-a of this article, but beginning no later than the first
day of July, two thousand eight, collect and pay to the member's
pension and relief fund member contributions of eight and one-half
percent of salary or compensation. Only those funds for which the
board of trustees has collected and paid the contributions as
herein provided and as provided in subsection (f), section twenty-
six-a of this article and meeting minimum standards for annual
municipal contributions to the fund shall be eligible to receive
moneys from the insurance policy surcharge pursuant to section
thirty-three, article three, chapter thirty-three of this code.
Provided, That the board of trustees for each pension and relief
fund may assess and collect from each member of the paid police
department or paid fire department or both each month not more than
an additional two and one half percent of the actual salary or compensation of each member: Provided, however, That if any board
of trustees decides to assess and collect any additional amount
pursuant to this subdivision above the member contribution required
by this section, then that board of trustees may not reduce the
additional amount until the respective pension and relief fund no
longer has any actuarial deficiency: Provided further, That if any
board of trustees decides to assess and collect any additional
amount, any board of trustees decision and any additional amount is
not the liability of the State of West Virginia. Member
contributions shall be deposited in the pension and relief fund
on
at least a monthly basis within five days of being collected.
(5)(d)(1) For the fiscal year beginning on the first day of
July,
one thousand nine hundred eighty-three two thousand eight,
and subject to provisions of subsection (c), section eighteen-b of
this article and sections fourteen-d and thirty-three, article
three, chapter thirty-three of this code and for each fiscal year
thereafter, the
State Treasurer oversight board shall
receive and
retain the
allocable portion of the Municipal Pensions and
Protection Fund, established in section fourteen-d, article three,
chapter thirty-three of this code, moneys allocated to the
Municipal Pensions Security Fund until such time as the treasurer
of the municipality applies for the allocable portion and certifies
in writing to the
State Auditor Municipal Pensions Oversight Board
that:
(A) The municipality has irrevocably contributed the amount
required under this section and section twenty of this article
and
section thirty-three, article three, chapter thirty-three of this
code to the pension and relief fund for the
fiscal year required period; and
(B) The board of trustees of the pension and relief fund has
made a report to the governing body of the municipality
and to the
oversight board on the condition of its fund with respect to the
fiscal year.
(6)(2) When the aforementioned application and certification
are made, the allocable portion of moneys from the Municipal
Pensions and Protection Fund,
or the Municipal Pensions Security
Fund once established shall be paid to the corresponding
policemen's or firemen's pension and relief fund:
Provided, That
proceeds from the insurance policy surcharge authorized by section
thirty-three, article three, chapter thirty-three of this code
shall be paid in accordance with provisions in that section.
Payment to a municipal pension and relief fund shall be made by
electronic funds transfer.
(7) (e) The State Auditor
and the oversight board has have the
power and duty
as each deems necessary to perform or review audits
on the pension and relief funds or to employ an independent
consulting actuary or accountant to determine the compliance of the
aforementioned certification with the requirements of this section
and section twenty of this article. The expense of the audit or
determination shall be paid from the portion of the municipal
pensions and protection fund allocable to municipal policemen's and
firemen's pension and relief funds
or from the Municipal Pensions
Security Fund pursuant to provisions of subsection (c), section
eighteen-b of this article. If the allocable portion of the
Municipal Pensions and Protection Fund
or the Municipal Pensions
Security Fund is not paid to the pension and relief fund within
thirty-six eighteen months, the portion is forfeited by the pension
and relief fund and is allocable to other eligible municipal
policemen's and firemen's pension and relief funds in accordance
with section fourteen-d, article three, chapter thirty-three of
this code.
§8-22-20. State contract actuary; actuarial valuation report;
minimum standards for annual municipality
contributions to the fund.; definitions; actuarial
review and audit.
The board of trustees for each pension and relief fund shall
have regularly scheduled actuarial valuation reports prepared by a
qualified actuary. All of the following standards must shall be
met:
(a)
An actuarial valuation report shall be prepared at least
once every three years commencing with the later of: (1) The first
day of July, one thousand nine hundred eighty-three; or (2) three
years following the most recently prepared actuarial valuation
report: Provided, That this most recently prepared actuarial
valuation report meets all of the standards of this section. The
oversight board shall contract with a qualified actuary to annually
prepare an actuarial valuation report on each pension and relief
fund. The oversight board's first contract shall be timed to begin
at the expiration of the State Treasurer's contract for the
actuary, but no later than the first day of January, two thousand
nine. The expense of the actuarial report shall be paid from
moneys in the Municipal Pensions Security Fund. Uses of the
actuarial valuations from the state's contract actuary shall
include, but not be limited to, determining a municipal policemen's or firemen's pension and relief fund's eligibility to receive state
money and to provide supplemental benefits.
(b) The actuarial valuation report
provided pursuant to
subsection (a) of this section shall consist of, but is not limited
to, the following disclosures: (1) The financial objective of the
fund and how the objective is to be attained; (2) the progress
being made toward realization of the financial objective; (3)
recent changes in the nature of the fund, benefits provided or
actuarial assumptions or methods; (4) the frequency of actuarial
valuation reports and the date of the most recent actuarial
valuation report; (5) the method used to value fund assets; (6) the
extent to which the qualified actuary relies on the data provided
and whether the data was certified by the fund's auditor or
examined by the qualified actuary for reasonableness; (7) a
description and explanation of the actuarial assumptions and
methods; and (8) any other information the qualified actuary feels
is necessary or would be useful in fully and fairly disclosing the
actuarial condition of the fund.
(c) (1) After the thirtieth day of June,
one thousand nine
hundred ninety-one two thousand eight, and thereafter,
the
financial objective of each municipality, and the minimum standard
for annual municipality contributions to the fund, except as
provided in section fourteen-d, article three, chapter thirty-three
of this code relating to plans funded at one hundred ten percent or
more, shall
not be
less than to contribute to the fund annually an
amount which, together with the contributions from the members and
the allocable portion of the Municipal Pensions and Protection Fund
for municipal pension and relief funds established under section fourteen-d, article three, chapter thirty-three of this code
or a
municipality's allocation from the Municipal Pensions Security Fund
created in section eighteen-b of this article and other income
sources as authorized by law will be sufficient
for the municipal
pension and relief fund to attain a projected targeted funded ratio
of one hundred percent by the thirtieth day of June, two thousand
forty-eight. For this purpose, the targeted funded ratio is defined
as the projected market value of assets as of the thirtieth day of
June, two thousand forty-eight, divided by the projected actuarial
accrued liabilities as of the thirtieth day of June, two thousand
forty-eight, based on the entry age normal cost method (level
percent of pay), assuming the actuarial assumptions will be
realized in the future and the number of active members remains
level in the future, except to the extent the Municipal Pension and
Relief Fund is closed to new entrants. In making these
determinations, the required contribution shall be calculated each
year as a level percentage of payroll over the years remaining,
beginning with the plan year ending on the thirtieth day of June,
two thousand nine, and including the plan year ending on the
thirtieth day of June, two thousand forty-eight. The level
percentage of payroll contributions shall be determined by
projecting assets and liabilities on an open-group basis assuming
the actuarial assumptions are realized and the number of active
members remains at the level on the valuation date, except to the
extent the fund is closed to new entrants. For years ending on the
thirtieth day of June in years two thousand nine through two
thousand thirteen, the required contribution, as a percentage of
the applicable payroll, may be increased in equal annual increments, from the required rate of contribution for the year
ending on the thirtieth day of June, two thousand eight, so that by
the year ending on the thirtieth day of June, two thousand
thirteen, the municipality is making contributions at the rate
required under this section. If the actuarial valuation on or
after the thirtieth day of June, two thousand eight, projects a
contribution rate for years two thousand thirteen and beyond
greater than forty-five percent, but less than sixty percent to
reach the one hundred percent targeted funded ratio in two thousand
forty-eight, the targeted funded ratio in year two thousand forty-
eight may be changed from one hundred percent to ninety percent.
If the actuarial valuation on or after the thirtieth day of June,
two thousand eight, projects a contribution rate for years two
thousand thirteen and beyond of sixty percent or more to reach the
one hundred percent targeted funded ratio in two thousand forty-
eight, the targeted funded ratio in year two thousand forty-eight
may be changed from one hundred percent to eighty percent.
However, in no event shall the targeted funded ratio be less than
the level determined in the actuarial valuation as of the thirtieth
day of June, two thousand eight. The required contribution shall
be determined each plan year as described above based on an
actuarial valuation reflecting actual demographic and investment
experience. Municipal pension and relief funds with a funded ratio
of ten percent or less as of the thirtieth day of June, two
thousand eight, will need to receive additional contributions from
the municipality to the extent necessary to ensure that sufficient
assets exist to pay expected benefits for a period of at least
eighteen months during each of the next six plan years beginning with the plan year ending on the thirtieth day of June, two
thousand nine. The funded ratio as of the thirtieth day of June,
two thousand eight, is defined as the market value of assets as of
the thirtieth day of June, divided by the actuarial accrued
liabilities as of the thirtieth day of June, based on the entry age
normal cost method (level percent of pay). After the thirtieth day
of June, two thousand forty-eight, and thereafter, the financial
objective of each municipality, and the minimum standards for
annual municipality contributions to the municipal pension and
relief fund, except as provided in section fourteen (d), article
three, chapter thirty-three of this code relating to plans funded
at one hundred ten percent or more, shall not be less than an
amount which, together with the contributions from the members and
the allocable portion of the Municipal Pensions and Protection Fund
for municipal pension and relief funds established under section
fourteen-d, article three, chapter thirty-three of this code or a
municipality's allocation from the Municipal Pensions Security Fund
created in section eighteen-b of this article and other income
sources as authorized by law will be sufficient to meet the normal
cost of the fund and amortize any actuarial deficiency over a
period of not more than
forty thirty years.
The thirty-year
amortization period shall commence in the first year following two
thousand forty-eight in which there is an actuarial deficiency as
of the first day of July in that year. In no year will the
municipal contribution be less than the normal cost net of employee
contributions, except as provided in section fourteen-d, article
three, chapter thirty-three of this code relating to plans funded
at one hundred ten percent or more. Provided, That in the fiscal year ending the thirtieth day of June, one thousand nine hundred
ninety-one, the municipality may elect to make its annual
contribution to the fund using an alternative contribution in an
amount not less than: (I) One hundred seven percent of the amount
contributed for the fiscal year ending the thirtieth day of June,
one thousand nine hundred ninety; or (ii) an amount equal to the
average of the contribution payments made in the five highest
fiscal years beginning with the fiscal year ending one thousand
nine hundred eighty-four, whichever is greater: Provided, however,
That contribution payments in subsequent fiscal years under this
alternative contribution method may not be less than one hundred
seven percent of the amount contributed in the prior fiscal year.:
Provided further, That in order to avoid penalizing municipalities
and to provide flexibility when making contributions,
municipalities using the alternative contribution method may
exclude a one-time additional contribution made in any one year in
excess of the minimum required by this section: And provided
further, That the governing body of any municipality may elect to
provide an employer continuing contribution of one percent more
than the municipality's required minimum under the alternative
contribution plan authorized in this subsection: And provided
further, That if any municipality decides to contribute an
additional one percent, then that municipality may not reduce the
additional contribution until the respective pension and relief
fund no longer has any actuarial deficiency: And provided further,
That any decision and any contribution payment by the municipality
is not the liability of the State of West Virginia: And provided
further, That if any municipality or any pension fund board of trustees makes a voluntary election and thereafter fails to
contribute the voluntarily increase as provided in this section and
in subdivision (4), subsection (b), section nineteen of this
article, then the board of trustees is not eligible to receive
funds allocated under section fourteen-d, article three, chapter
thirty-three of this code: And provided further, That prior to
using this alternative contribution method the actuary of the fund
shall certify in writing that the fund is projected to be solvent
under the alternative contribution method for the next consecutive
fifteen-year period. For purposes of determining this minimum
financial objective: (I) The value of the fund's assets shall be
determined on the basis of any reasonable actuarial method of
valuation which takes into account fair market value; and (ii) all
costs, deficiencies, rate of interest and other factors under the
fund shall be determined on the basis of actuarial assumptions and
methods which, in aggregate, are reasonable (taking into account
the experience of the fund and reasonable expectations) and which,
in combination, offer the qualified actuary's best estimate of
anticipated experience under the fund: And provided further, That
any municipality which elected the alternative funding method under
this section and which has an unfunded actuarial liability of not
more than twenty-five percent of fund assets, may, beginning the
first day of September, two thousand three, elect to revert to the
standard funding method, which is to contribute to the fund
annually an amount which is not less than an amount which, together
with the contributions from the members and the allocable portion
of the Municipal Pensions and Protection Fund for municipal pension
and relief funds established under section fourteen-d, article three, chapter thirty-three of this code and other income sources
as authorized by law, will be sufficient to meet the normal cost of
the fund and amortize any actuarial deficiency over a period of not
more than forty years, beginning from the first day of July, one
thousand nine hundred ninety-one.
(2) For purpose of this section, the term "normal cost" and
"actuarial accrued liability" shall be consistent with the
Actuarial Standards of Practice published by the Actuarial
Standards Board. Furthermore, the normal cost and actuarial accrued
liability shall be based on the Entry Age Normal Actuarial Cost
Method under which the actuarial present value of projected
benefits is allocated as a level percentage of earnings of the
individual between entry age and the assumed exit ages.
(3) The actuarial assumptions used to develop the normal cost
and actuarial accrued liability shall be consistent with the
Actuarial Standards of Practice published by the Actuarial
Standards Board.
(4) The term actuarial deficiency means the actuarial accrued
liability less the actuarial value of assets. The actuarial value
of assets shall be determined in a manner consistent with the
Actuarial Standards of Practice published by the Actuarial
Standards Board.
(5) For years after two thousand forty-eight, the amortization
of the actuarial deficiency shall be based on a level dollar basis.
(6) The actuarial process, which includes the selection of
methods and assumptions, shall be reviewed by the qualified actuary
no less than once every five years. Furthermore, the qualified
actuary shall provide a report to the oversight board with recommendations on any changes to the actuarial process.
(7) The oversight board shall hire an independent reviewing
actuary to perform an actuarial audit of the work performed by the
qualified actuary no less than once every seven years.
(2) No municipality may anticipate or use in any manner any
state funds accruing to the police or firemen's pension fund to
offset the minimum required funding amount for any fiscal year.
(3) Notwithstanding any other provision of this section or
article to the contrary, each municipality shall contribute
annually to the fund an amount which may not be less than the
normal cost, as determined by the actuarial report.
(d) For purposes of this section the term "qualified actuary"
means only an actuary who is a member of the Society of Actuaries
or the American Academy of Actuaries. The qualified actuary shall
be designated a fiduciary and shall discharge his or her duties
with respect to a fund solely in the interest of the members and
member's beneficiaries of that fund. In order for the standards of
this section to be met, the qualified actuary shall certify that
the actuarial valuation report is complete and accurate and that in
his or her opinion the technique and assumptions used are
reasonable and meet the requirements of this section of this
article.
(e) The cost of the preparation of the actuarial valuation
report shall be paid by the fund.
(f) Notwithstanding any other provision of this section, for
the fiscal year ending the thirtieth day of June, one thousand nine
hundred ninety-one, the municipality may calculate its annual
contribution based upon the provisions of the supplemental benefit provided in this article enacted during the one thousand nine
hundred ninety-one regular session of the Legislature.
§8-22-20a. Hiring of actuary; preparation of actuarial valuations.
(a)(1) The Legislature finds that it is in the best interests
of the state and its municipalities to have accurate data regarding
the various municipal police and firemen's pension and relief
funds.
The Legislature finds that data received from the funds is
not always reliable due to inconsistent methods of reporting. The
Legislature also finds that the municipalities need to know if the
data on which they are basing their decisions on regarding pensions
for their police and firemen is accurate and that they can depend
on it.
(2) The Legislature finds that the State Treasurer should
contract with an actuary as a consultant for the municipal police
and firemen's pension and relief funds and
that among other duties
the actuary
should shall determine if there is consistent reporting
from the various funds. The Legislature further finds that the
State Treasurer should share the results of the actuary's annual
valuation with the appropriate municipality.
(b)
Notwithstanding any other provision of this code to the
contrary Except as hereinafter provided, beginning the first day of
July, two thousand two, the State Treasurer shall select by
competitive bid and contract with a single qualified actuary. The
actuary shall serve as a consultant to the treasurer with regard to
the operation of the municipal police and firemen's pension and
relief funds and shall report annually to the treasurer with regard
to all funds existing in this state by virtue of this article.
The
treasurer may pay for Costs associated with the actuary's work
shall be paid out of the
fund Municipal Pensions and Protection
Fund established pursuant to section fourteen-d, article three,
chapter thirty-three of this code.
Beginning at the expiration of
the State Treasurer's contract with the actuary for the year two
thousand eight, but beginning no later than the first day of
January, two thousand nine, and thereafter, it shall be the duty of
the oversight board to contract for the single qualified actuary
which shall serve as a consultant to the oversight board and shall
report annually to the oversight board with regard to all funds
existing in this state by virtue of this article and which shall be
paid from moneys deposited in the municipal pensions security fund.
Copies of the annual report prepared by the actuary shall be sent
to the chair of the House of Delegates Committee on Pensions and
Retirement and the chair of the Senate Committee on Pensions. Each
municipal pension and relief fund shall receive a copy of the
actuary's results related to that fund.
(c) With respect to each municipal police or firemen's pension
and relief fund, the actuary shall complete an annual valuation in
accordance with actuarial standards of practice promulgated by the
actuarial standards board of the American Academy of Actuaries.
The report of the valuation shall include: (1) A summary of the
benefit provisions evaluated; (2) a summary of the census data and
financial information used in the valuation; (3) a description of
the actuarial assumptions, actuarial costs method and asset
valuation method used in the valuation, including a statement of
the assumed rate of payroll growth and assumed rate of growth or
decline in the number of the fund members' contribution to the
pension fund; (4) a summary of findings that includes a statement of the actuarially accrued pension liabilities and unfunded
actuarial accrued pension liabilities; (5) a schedule showing the
effect of any changes in the benefit provisions, actuarial
assumptions or cost methods since the last annual actuarial
valuation; (6) a statement of whether contributions to the pension
fund are in accordance with the provisions of this chapter and
whether they are expected to be sufficient; and (7) any other
matters determined by the Treasurer
or, following the first day of
January, two thousand nine, the oversight board, to be necessary or
appropriate.
The treasurer shall forward A copy of the annual
valuation
shall be forwarded to the municipality for which it was
completed.
(d) (1) The hiring of an actuary under the provisions of this
section shall not be construed to make the municipal police and
firemen's pension and relief funds the responsibility or obligation
of the State of West Virginia.
(2) Any actuarial deficiency identified by the actuary under
this section or this article is not an obligation of the State of
West Virginia.
§8-22-22. Investment of funds; exercise of judgment in making
investments; report of investment plan.
(a) The board of trustees may invest a portion or all of the
fund assets in
the state consolidated fund or the consolidated
pension fund any of the pools, funds and securities managed by the
West Virginia Investment Management Board or West Virginia Board of
Treasury Investments or as otherwise provided in this section. The
board of trustees shall keep as an available sum for the purpose of
making regular retirement, disability retirement, death benefit, payments and administrative expenses in an estimated amount not to
exceed payments for a period of ninety days
in short-term
investments. The board of trustees, in acquiring, investing,
reinvesting, exchanging, retaining, selling and managing property
for the benefit of the fund shall
exercise judgment and care under
fiduciary duty which persons of prudence, discretion, and
intelligence exercise in the management of their own affairs, not
in regard to speculation, but in regard to the permanent
disposition of their funds, considering the probable total return
as well as the preservation of principal do so in accordance with
the provisions of the Uniform Prudent Investor Act codified as
article six-c, chapter forty-four of this code. Within the
limitations of the
foregoing standard Uniform Prudent Investor Act,
the board of trustees is authorized in its sole discretion to
invest and reinvest any funds received by it and not invested
in
the consolidated fund or the consolidated pension fund with the
West Virginia Investment Management Board or West Virginia Board of
Treasury Investments. in the following:
(a) Any direct obligation of, or obligation guaranteed as to
the payment of both principal and interest by, the United States of
America;
(b) Any evidence of indebtedness issued by any United States
government agency guaranteed as to the payment of both principal
and interest, directly or indirectly, by the United States of
America including, but not limited to, the following: Government
national mortgage association, federal land banks, federal national
mortgage association, federal home loan banks, federal intermediate
credit banks, banks for cooperatives, Tennessee valley authority, United States postal service, farmers home administration,
export-import bank, federal financing bank, federal home loan
mortgage corporation, student loan marketing association and
federal farm credit banks;
(c) Readily marketable (i.e. traded on a national securities
exchange) debt securities having a Standard & Poor rating of A (or
equivalent to Moody's rating) or higher, excluding municipal
securities;
(d) Any evidence of indebtedness that is secured by a first
lien deed of trust or mortgage upon real property situated within
this state, if the payment thereof is substantially insured or
guaranteed by the United States of America or any agency thereof;
(e) Repurchase agreements issued by any bank, trust company,
national banking association or savings institutions which mature
in less than one year and are fully collateralized. No reverse
repurchase agreements shall be allowed;
(f) Interest bearing deposits including certificates of
deposit and passbook savings accounts that are FDIC insured;
(g) Equity. -- Common stocks, securities convertible into
common stocks, or warrants and rights to purchase such securities:
Provided, That each shall be listed on the NYSE, ASE or are traded
on the National OTC Market and listed on the NASDAQ National
Market.
(h) (b) The board of trustees of each fund may delegate
investment authority to equity mutual funds managers and/or
professional
registered investment advisors
who are registered with
the Securities and Exchange Commission,
in addition to being
registered in accordance with the Investment Advisors Act of 1940, and
registered with the appropriate state regulatory agencies, if
applicable,
and who
also manage assets in excess of seventy-five
million dollars.
(c) The board of trustees of each fund shall deliver to the
oversight board on or before the last day of September, two
thousand eight, a copy of the pension and relief fund's investment
policy. The board of trustees shall submit to the oversight board
any change to the investment policy within thirty days of the
board's authorizing the change.
§8-22-22a. Restrictions on investments.
(a) Moneys invested as permitted by section twenty-two of this
article
and not invested with the West Virginia Investment
Management Board or the board of Treasury Investments are subject
to the following restrictions and conditions contained in this
section:
(a) Fixed income securities shall at no time exceed ten
percent of the total assets of the pension fund, which are issued
by one issuer, other than the United States Government or agencies
thereof, whereas this limit shall not apply;
(b) At no time shall the equity portion of the portfolio
exceed sixty percent of the total portfolio. Furthermore, the
debit or equity securities of any one company or association shall
not exceed five percent with a maximum of fifteen percent in any
one industry;
(c) Notwithstanding any other provisions of this article, any
investments in equities under subsections (g) and (h), section
twenty-two of this article shall be subject to the following
additional guidelines:
(1) Equity mutual funds shall be no sales load (front or back)
and no contingent deferred sales charges shall be allowed. The
total annual operating expense ratio shall not exceed one and
three-quarter percent for any mutual fund;
(2) The stated investment policy requires one hundred percent
of the equities of the portfolio be that of securities which are
listed on the New York Stock Exchange, the American Stock Exchange
or the NASDAQ National Market; and
(3) Equity mutual funds may be only of the following fund
description stated purpose: Growth funds, growth and income funds,
equity income funds, index funds, utilities funds, balanced funds
and flexible portfolio funds.
(1) The board shall hold in nonreal estate equity investments
no more than seventy-five percent of the assets managed by the
board and no more than seventy-five percent of the assets of any
individual participant plan.
(2) The board shall hold in real estate equity investments no
more than twenty-five percent of the assets managed by the board
and no more than twenty-five percent of the assets of any
individual participant plan: Provided, That the investment be made
only upon the recommendation by a professional, third-party
fiduciary investment adviser registered with the Securities and
Exchange Commission under the Investment Advisors Act of 1940, as
amended, upon the approval of the board or a committee designated
by the board, and upon the execution of the transaction by a third-
party investment manager: Provided, however, That the board's
ownership interest in any fund is less than forty percent of the
fund's assets at the time of purchase: Provided further, That the combined investment of institutional investors, other public sector
entities and educational institutions and their endowments and
foundations in the fund is in an amount equal to or greater than
fifty percent of the board's total investment in the fund at the
time of acquisition. For the purposes of this subsection, "fund"
means a real estate investment trust traded on a major exchange of
the United States of America or a partnership, limited partnership,
limited liability company or other entity holding or investing in
related or unrelated real estate investments, at least three of
which are unrelated and the largest of which is not greater than
forty percent of the entity's holdings at the time of purchase.
(3) The board shall hold in international securities no more
than thirty percent of the assets managed by the board and no more
than thirty percent of the assets of any individual participant
plan.
(4) The board may not at the time of purchase hold more than
five percent of the assets managed by the board in the nonreal
estate equity securities of any single company or association:
Provided, That if a company or association has a market weighting
of greater than five percent in the Standard & Poor's 500 index of
companies, the board may hold securities of that nonreal estate
equity equal to its market weighting.
(5) No security may be purchased by the board unless the type
of security is on a list approved by the board. The board may
modify the securities list at any time, and shall review the list
annually.
(6) Notwithstanding the investment limitations set forth in
this section, it is recognized that the assets managed by the board may temporarily exceed the investment limitations in this section
due to market appreciation, depreciation and rebalancing
limitations. Accordingly, the limitations on investments set forth
in this section shall not be considered to have been violated if
the board rebalances the assets it manages to comply with the
limitations set forth in this section at least once every twelve
months based upon the latest available market information and any
other reliable market data that the board considers advisable to
take into consideration, except for those assets authorized by
subdivision (2) of this subsection for which compliance with the
percentage limitations shall be measured at such time as the
investment is made.
(7) The board shall annually review, establish and modify, if
necessary, the board's investment objectives and investment policy
so as to provide for the financial security of the trust funds
giving consideration to the following:
(A) Preservation of capital;
(B) Diversification;
(C) Risk tolerance;
(D) Rate of return;
(E) Stability;
(F) Turnover;
(G) Liquidity; and
(H) Reasonable cost of fees.
(8) The board is expressly prohibited from investing in any
class, style or strategy of alternative investments including a
private equity fund such as a venture capital, private real estate
or buy-out fund; commodities fund; distressed debt fund; mezzanine debt fund; hedge fund; or fund consisting of any combination of
private equity, distressed or mezzanine debt, hedge funds, private
real estate, commodities and other types and categories of
investment permitted under this article.
(d) (b) The board of trustees of each fund shall obtain an
independent performance evaluation of the funds at least annually
and the evaluation shall consist of comparisons with other funds
having similar investment objectives for performance results with
appropriate market indices; and
(e) (c) Each entity conducting business for each pension fund
shall fully disclose all fees and costs of
transactions investing
conducted on a quarterly basis
to the trustees of the fund and to
the oversight board. Entities conducting business in mutual funds
for and on behalf of each pension fund shall timely file revised
prospectus and normal quarterly and annual Securities Exchange
Commission reporting documents with the board of trustees of each
pension fund.
§8-22-23a. Eligibility for total and temporary disability
pensions and total and permanent disability
pensions; reporting.
(a) All members applying for total and temporary or total and
permanent disability benefits after the thirtieth day of June, one
thousand nine hundred eighty-one, shall be examined by at least two
physicians under the direction of the staff at Marshall University,
West Virginia University, Morgantown or West Virginia University,
Charleston:
Provided, That if
such a member's medical condition
cannot be agreed upon by
the two
such physicians, a third physician
shall examine
such the member
: Provided, however, That beginning the first day of September, two thousand eight, and continuing
thereafter, a member applying for total and temporary or total and
permanent disability benefits shall be examined by two physicians,
one to be chosen by the applying member and paid by the board of
trustees and the other to be chosen and paid by the oversight
board. If the two physicians disagree, the oversight board shall
select and pay for a third examining physician. Such Each medical
examination shall include the review of
such the member's medical
history,
but an examining physician may not have access to the
disability examination report or disability recommendation of
another physician. The physicians shall send copies of their
reports to both the board of trustees of the member's pension and
relief fund and the oversight board. The expense of the member's
transportation to
such medical
examination examinations and the
expense of the medical examination shall be paid by the board of
trustees.
such Medical expense shall not exceed the reasonable and
customary charges for
such similar services.
Beginning the first
day of July, two thousand eight, and thereafter, if a member is
charged with an offense that has the potential to lead to the
member's termination, the member's municipal pensions and relief
fund board of trustees may not consider the member's eligibility
for disability benefits until after investigation of the charge is
completed and any disciplinary decision is implemented. No later
than the first day of January, two thousand nine, and annually
thereafter, each board of trustees shall report to the oversight
board the total number of disability applications received during
the prior fiscal year, the status of each application as of the end
of the fiscal year, total applications granted and denied and the percentage of disability benefit recipients to the total number of
active members of the fund.
(b) Effective for members becoming eligible for total and
temporary disability benefits after the thirtieth day of June, one
thousand nine hundred eighty-one, initially or previously under
this subsection allowance for initial or additional total and
temporary disability payments, the amount thereof to be determined
as specified in section twenty-four of this article shall be paid
to
such the member during
such the disability for a period not
exceeding twenty-six weeks if after a medical examination in
accordance with subsection (a) of this section of this article two
examining physicians report in writing to the board of trustees
that: (1)
such The member has become so totally, physically or
mentally disabled, from any reason, as to render
such the member
totally, physically or mentally, incapacitated for employment as a
police officer or firefighter; and (2) it has not been determined
if
such the disability is permanent or it has been determined that
such the disability may be alleviated or eliminated if
such the
member follows a reasonable medical treatment plan or reasonable
medical advice:
Provided, That, in any event, a member is not
eligible for total and temporary disability payments following the
fourth consecutive 26-week period of total and temporary disability
unless
such subsequent disability results from a cause unrelated to
the cause of the four previous periods of total and temporary
disability. During
such the two-year period of
such total and
temporary disability,
such the department is required to restore
such the member to his
or her former position in
such the
department at any time
he the member is determined to no longer be disabled:
Provided, That the department may refill, on a temporary
basis, the position vacated by s
uch the member after the first
twenty-six weeks of his temporary disability.
(c) Effective for members becoming eligible for total and
permanent disability benefits initially under this subsection or
becoming eligible for total and temporary disability benefits under
subsection (b) of this section after the thirtieth day of June, one
thousand nine hundred eighty-one, allowance for total and permanent
disability payments, the amount thereof to be determined as
specified in section twenty-four of this article, shall be paid to
such the member after a medical examination in accordance with
subsection (a) of this section, two examining physicians report in
writing to the board of trustees that
such the member has become so
totally, physically or mentally and permanently disabled, as a
proximate result of service rendered in the performance of his
or
her duties in
such the department, as to render
such the member
totally, physically or mentally and permanently incapacitated for
employment as a police officer or firefighter or, if
such the
member has been a member of either of
such the departments for a
period of not less than five consecutive years preceding
such the
disability,
such the member has become so totally, physically or
mentally and permanently disabled, from any reason other than
service rendered in the performance of his
or her duties in
such
the department, as to render
such the member totally, physically or
mentally and permanently incapacitated for employment as a police
officer or firefighter. The phrase "totally, physically or
mentally and permanently disabled" shall not be construed to
include a medical condition which may be corrected if
such the member follows a reasonable medical treatment plan or reasonable
medical advice.
(d) Effective for members becoming eligible for total and
temporary disability benefits after the thirtieth day of June, one
thousand nine hundred eighty-one, under the provisions of
subsection (b) of this section, any payments for total and
temporary disability for a period during
such the disability not
exceeding twenty-six weeks shall cease at the end of
such the 26-
week period under the following conditions:
(1)
Such The member fails to be examined as provided in
subsection (a) of this section; or (2)
such the member is examined
or reexamined as provided in subsection (a) and two examining
physicians report to the board of trustees that
such the member's
medical condition does not meet the requirements of subsection (b)
or (c) of this section. Effective for members becoming eligible
for total and temporary disability benefits after the thirtieth day
of June, one thousand nine hundred eighty-one, under subsection (b)
of this section, subsequent to
such the member's receipt of total
and temporary disability payments for a period of two years,
such
the payments shall cease at the end of
such the two-year period
under the following conditions: (I)
Such The member fails to be
examined as provided in subsection (a) of this section of this
article; or (ii)
such the member is examined or reexamined as
provided in subsection (a) and two examining physicians report to
the board of trustees that
such the member's medical condition does
not meet the requirements of subsection (c) of this section.
(e) Notwithstanding other provisions in this section, a member
of a municipal policemen's or firemen's pension and relief fund who is found to be disabled from performing the full range of tasks
relevant to police officer or firefighter employment but capable of
performing a restricted or light-duty police officer or firefighter
job made available at the discretion of the employing municipality
may choose to continue working and retain an active membership in
his or her pension and relief fund.
§8-22-26a. Supplemental pension benefits entitlement; benefit
payable; application of section; construction;
solvency defined.
(a) Except as otherwise provided in this section, all
retirees, surviving beneficiaries, disability pensioners or future
retirees shall receive as a supplemental pension benefit an
annualized monthly amount commencing on the first day of July,
based on a percentage increase equal to any increase in the
CPI-U
consumer price index as calculated by the United States Department
of Labor, Bureau of Statistics, for the preceding
calendar year:
Provided, That the supplemental pension benefit specified herein
shall not exceed four percent per year:
Provided, however, That no
retiree shall be eligible for the supplemental pension benefit
specified herein until the first day of July after the expiration
of two years from the date of retirement of
said the retiree:
Provided further, That persons retiring prior to the effective date
of this section shall receive the supplemental benefit provided for
in this section immediately upon retirement and shall not be
subject to the two year delay: Provided further, That the
supplemental benefit shall
only be calculated
only on the allowable
amount, which is the first fifteen thousand dollars of the total
annual benefit paid,
in addition to accumulated supplemental pension benefits from previous years. The supplemental benefit is
calculated by multiplying the appropriate percentage increase for
the year by a total which represents the original fifteen thousand
dollars and any supplemental amount previously awarded. If at any
time after the supplemental benefit becomes applicable, the total
accumulated percentage increase in benefit on the allowable amount
becomes less than seventy-five percent of the total accumulated
percentage increase in the consumer price index over that same
period of time, the four percent limitation shall be inapplicable
until such time as the supplemental benefit paid equals
seventy-five percent of the accumulated increase in the consumer
price index. The supplemental pension benefit payable under the
provisions of this section shall be paid in equal monthly
installments.
(b) Upon commencement of the payment of death benefits
pursuant to section twenty-six of this article, there shall be
calculated on the allowable amount, which is the first fifteen
thousand dollars of the annual allowable benefit under said
section, the supplemental benefit provided for in subsection (a) of
this section using the date that the retirement benefit provided
for pursuant to section twenty-five of this article began as the
base year. The amount of the death benefit provided pursuant to
section twenty-six of this article shall be calculated without
regard to any supplemental benefit previously paid under this
section. After the initial calculation made pursuant to this
subsection the beneficiary of the benefits provided
for pursuant to
section twenty-six of this article shall, after reindexation,
thereafter receive the supplemental benefit provided
for in subsection (a) of this section.
(c) Persons becoming disabled and eligible for a benefit under
subsection (d), section twenty-four of this article after the first
day of January, one thousand nine hundred ninety-one, shall receive
as an annualized monthly supplemental benefit commencing on each
July the first an amount based on a percentage increase equal to
any increase in the consumer price index as calculated by the
United States Department of Labor, Bureau of Statistics, for the
preceding year:
Provided, That the supplemental pension benefit
shall not exceed four percent per year:
Provided, however, That
the benefit provided herein shall not commence until the first day
of July in the second year after what would have been the earliest
service retirement date pursuant to section twenty-five of this
article for the person receiving the disability benefit:
Provided
further, That for persons becoming eligible for a benefit under
subsection (d), article twenty-four of this section who were not
employed in the preceding year and file a copy of his or her income
tax return by the fifteenth of April each year, evidencing
said a
lack of employment, the benefit provided herein shall commence on
the first day of July in the second year after the date of
disablement:
And provided further, That the supplemental benefit
shall only be calculated on the allowable amount, which is the
first fifteen thousand dollars of the total annual benefit paid
in
addition to accumulated supplemental pension benefits from previous
years. If at any time after the commencement of the payment of the
supplemental benefit provided under this subsection the total
accumulated percentage increase in benefit on the allowable amount
becomes less than seventy-five percent of the total accumulated increase in the consumer price index for that same period of time,
the four percent limitation shall be inapplicable until such time
as the supplemental benefit paid equals seventy-five percent of the
accumulated increase in the consumer price index.
(d) Persons receiving a disability pension pursuant to section
twenty-four of this article prior to the first day of January, one
thousand nine hundred ninety-one, shall receive commencing each
July first, as an annualized monthly supplemental benefit an amount
based on a percentage increase equal to any increase in the
consumer price index as calculated by the United States Department
of Labor, Bureau of Statistics, for the preceding year:
Provided,
That the supplemental benefit provided herein shall not exceed two
percent per year:
Provided, however, That beginning the first day
of July two years after what would have been the earliest service
retirement date pursuant to section twenty-five of this article the
supplemental benefit provided herein shall not exceed four percent
per year. The amount of supplemental benefit provided in this
subsection shall not exceed four percent beginning the first day of
July in any twelve month period for any pensioner who files a
certified copy of his or her tax return evidencing that
said the
pensioner was unemployed in the preceding year and received no
earned income. The tax return shall be filed by the fifteenth of
April in
any such year the year following the year of unemployment.
If at any time after the first day of July in the second year from
what would have been the earliest service retirement date pursuant
to section twenty-five of this article the total accumulated
percentage increase in the supplemental benefit provided pursuant
to this subsection on the allowable amount becomes less than the seventy-five percent of the total accumulated percentage increase
in the consumer price index over that same period of time, the
maximum percentage shall be inapplicable until such time as the
percentage increase in the supplemental benefit paid equals
seventy-five percent of the accumulated increase in the consumer
price index. The supplemental benefit provided in this subsection
shall
only be calculated on the allowable amount
only, which is the
first fifteen thousand dollars of the annual benefit paid
in
addition to accumulated supplemental pension benefits from previous
years.
(e) Any supplemental benefits paid during a period of
nonentitlement may be withheld out of subsequent regular monthly
pension benefits.
(f)
During the fiscal year ending on the thirtieth day of
June, one thousand nine hundred ninety-six and each year
thereafter, Each municipal policemen's and firemen's pension fund
shall be reviewed
annually by a qualified actuary
as provided in
section twenty of this article, who shall make a determination as
to its
actuarial soundness solvency. Based upon the actuary's
determination of the
actuarial soundness solvency of the fund, the
actuary shall certify to the board of trustees of the fund the
amount of increase in supplemental benefits, if any, which may be
paid, and which will preserve the
minimum standards for actuarial
soundness solvency of the fund
as set forth in section twenty of
this article.
For purposes of this section, a fund shall be
considered solvent for a fiscal year if assets are sufficient to
pay expected benefit payments for at least the next eighteen months
after the increase in supplemental benefits. The board of trustees shall increase supplemental benefits by an amount which is equal to
the actuary's certified recommendation, up to the four-percent
limit contained in this section or the increase in the consumer
price index, whichever is less,
provided that the plan is solvent
and municipality contributions under subsection-c, section twenty
of this article are fully paid to date. If the actuary determines
that
it is necessary to preserve the actuarial soundness of the
fund the funded ratio of a policemen's or firemen's fund is less
than eighty percent, the board of trustees of the fund shall
forthwith increase the percentage of the members' contribution
from
seven percent to the amount certified by the actuary not to exceed
to eight and one-half percent, but only for so long as is necessary
to achieve the
minimum standards for actuarial soundness required
by section twenty of this article funded ratio of one hundred
percent. In any year in which there is no supplemental benefit
paid,
such the year shall not be included in the reindexation
calculation provided pursuant to this section.
(g) This section shall be construed liberally to effectuate
the purpose of establishing minimum pension benefits under this
article for members and surviving spouses.
§8-22-27. General provisions concerning disability pensions,
retirement pensions and death benefits.
(a) In determining the years of service of a member in a paid
police or fire department for the purpose of ascertaining certain
disability pension benefits, all retirement pension benefits and
certain death benefits, the following provisions shall be
applicable:
(1) Absence from the service because of sickness or injury for a period of two years or less shall not be construed as time out of
service; and
(2) Any member of any paid police or fire department covered
by the provisions of sections sixteen through twenty-eight of this
article who has been
required to or shall at any future time be
required to enter the Armed Forces of the United States by
conscription, by reason of being a member of some reserve unit of
the Armed Forces or a member of the West Virginia National Guard or
air National Guard, whose reserve unit or guard unit is called into
active duty for one year or more, or who enlists in one of or will
be on qualified military service in the armed forces of the United
States,
and who upon receipt of has an honorable discharge from
such the armed forces, presents himself
or herself for resumption
of duty to his
or her appointing municipal official within six
months from his date of discharge and is accepted by
the pension
board's board of medical examiners medical examiners appointed by
the oversight board as being mentally and physically capable of
performing
his the required duties as a member of
such the paid
police or fire department, shall be given credit for continuous
service in
said the paid police or fire department
and his the
member's rights shall be governed as herein provided.
The
six-month period in which a member has to resume employment and
receive credit for continuous service is extended to a period not
to exceed two years if the member has been hospitalized for, or
convalescing from, an illness or injury incurred in, or aggravated
during, qualified military service. No member of a paid police or
fire department shall be required to pay the monthly assessment, as
now required by law, during
his a period of
qualified military service
in the Armed Forces of the United States. However, a
member who desires to make up member assessments, in whole or in
part, has five years from the date of return to work, but shall not
be required to pay any interest or other charges for the
assessments being made up. The employer must pay the employer
contributions for the periods made up by the member within ninety
days of each payment, or within ninety days of the normal due date.
A member who resumes duty with a paid police or fire department
after qualified military service is entitled to accrued benefits
only to the extent that the member made up the member assessments.
(b) As to any former member of a paid police or fire
department receiving disability pension benefits or retirement
pension benefits from a policemen's or firemen's pension and relief
fund, on the first day of July, one thousand nine hundred
eighty-five, the following provisions shall govern and control the
amount of
such the pension benefits:
(1) A former member who on June thirtieth, one thousand nine
hundred sixty-two, was receiving disability pension benefits or
retirement pension benefits from a policemen's or firemen's pension
and relief fund, shall continue to receive pension benefits, but on
and after July one, one thousand nine hundred eighty-five,
such the
pension benefits shall be no less than the amount of five hundred
dollars per month; and
(2) A former member who became entitled to disability pension
benefits or retirement pension benefits on or after July one, one
thousand nine hundred sixty-two, shall continue to receive pension
benefits, but on and after July one, one thousand nine hundred
eighty-five, shall receive the disability pension benefits, or retirement pension benefits provided for in section twenty-four or
section twenty-five of this article, as the case may be.
(c) As to any surviving spouse, dependent child or children,
or dependent father or mother, or dependent brothers or sisters, of
any former member of a paid police or fire department, receiving
any death benefits from a policemen's pension and relief fund or
firemen's pension and relief fund, on the first day of July, one
thousand nine hundred eighty-five, the following provisions shall
govern and control the amount of such death benefits:
(1) A surviving spouse, dependent child or children or
dependent father or mother, or dependent brothers or sisters, of
any former member, who on June thirty, one thousand nine hundred
sixty-two, was receiving any death benefits from a policemen's
pension and relief fund or firemen's pension and relief fund, shall
continue to receive death benefits, but on and after July one, one
thousand nine hundred eighty-five, such death benefits shall be no
less than the following amounts: To a surviving spouse, until
death or remarriage, the sum of three hundred dollars per month, to
each dependent child the sum of thirty dollars per month, until
such child shall attain the age of eighteen years or marries,
whichever first occurs; to each dependent orphaned child, the sum
of forty-five dollars per month, until such child attains the age
of eighteen years or marries, whichever first occurs; to each
dependent father and mother the sum of thirty dollars per month for
each; to each dependent brother or sister, the sum of fifty dollars
per month, until
such the individual attains the age of eighteen
years or marries, whichever first occurs, but in no event shall the
aggregate amount paid to such brothers and sisters exceed one hundred dollars per month. If at any time, because of the number
of dependents, all such dependents cannot be paid in full as herein
provided, then each dependent shall receive
his a pro rata share of
such the payments. In no case shall the payments to the surviving
spouse and children be cut below sixty-five percent of the total
amount paid to all dependents; and
(2) A surviving spouse, dependent child or children, or
dependent father or mother, or dependent brothers or sisters, of
any former member who became eligible for death benefits on or
after July one, one thousand nine hundred sixty-two, shall continue
to receive death benefits, but on and after July one, one thousand
nine hundred eighty-five, shall receive the death benefits provided
for in section twenty-six of this article.
(d) A former member who is receiving disability pension
benefits on the first day of July, one thousand nine hundred
eighty-five, shall continue to receive disability pension benefits
provided
for in section twenty-four of this article.
CHAPTER 33. INSURANCE.
ARTICLE 2. INSURANCE COMMISSIONER.
§33-2-15e. Study required.
The commissioner is hereby directed to study the impact of
grouping risks by classifications and by territorial areas for the
establishment of rates and minimum premiums, as set forth in
subdivision (2), subsection (c), section three, article twenty of
this chapter, and to submit a report to the Legislature by the
thirtieth day of September, two thousand eight.
§33-3-14d. Additional fire and casualty insurance premium tax;
allocation of proceeds; effective date.
(a)
(1) For the purpose of providing additional revenue for
municipal policemen's and firemen's pension and relief funds and
the Teachers Retirement System reserve fund and for volunteer and
part volunteer fire companies and departments, there is hereby
levied and imposed an additional premium tax equal to one percent
of taxable premiums for fire insurance and casualty insurance
policies. For purposes of this section, casualty insurance does
not include insurance on the life of a debtor pursuant to or in
connection with a specific loan or other credit transaction or
insurance on a debtor to provide indemnity for payments becoming
due on a specific loan or other credit transaction while the debtor
is disabled as defined in the policy.
(2) All moneys collected from this additional tax shall be
received by the commissioner and paid by him or her into a special
account in the State Treasury, designated the Municipal Pensions
and Protection Fund:
Provided, That subject to provisions of
section eighteen-b, article twenty-two, chapter eight of this code,
after the first day of July, two thousand eight, moneys designated
for municipal policemen's and firemen's pension and relief funds
shall be deposited in the Municipal Pensions Security Fund. The
net proceeds of this tax after appropriation thereof by the
Legislature is distributed in accordance with the provisions of
this section,
except for distribution from proceeds pursuant to
subsection (d), section eighteen-a, article twenty-two of this
code.
(b) (1) Before the first day of August of each calendar year,
the treasurer of each municipality in which a municipal policemen's
or firemen's pension and relief fund has been established shall report to the State Treasurer the average monthly number of members
who worked at least one hundred hours per month and the average
monthly number of retired members of municipal policemen's or
firemen's pension systems during the preceding fiscal year:
Provided, That beginning in the year two thousand nine and
continuing thereafter, the report shall be made to the oversight
board created in section eighteen-a, article twenty-two, chapter
eight of this code. These reports received by the oversight board
shall be provided annually to the State Treasurer by the first day
of September.
(2) Before the first day of September of each calendar year,
the
State Treasurer Municipal Pensions Oversight Board shall
allocate and authorize for distribution the revenues in the
municipal pensions and protection fund which were collected during
the preceding calendar year for the purposes set forth in this
section.
Except as hereinafter provided, sixty-five percent of the
revenues are allocated to municipal policemen's and firemen's
pension and relief funds; twenty-five percent of the revenues shall
be allocated to volunteer and part volunteer fire companies and
departments; and ten percent of such allocated revenues are
allocated to the Teachers Retirement System reserve fund created by
section eighteen, article seven-a, chapter eighteen of this code:
Provided, That
subject to provisions in section eighteen-b, article
twenty-two, chapter eight and section thirty-three, article three,
chapter thirty-three of this code beginning in the year two
thousand eight, the Municipal Pensions Oversight Board shall
thereafter allocate and authorize for distribution the revenues in
the Municipal Pensions Security Fund before the first day of September of each calendar year. Beginning the first day of
January, two thousand nine, and thereafter, seventy-five percent of
the revenues from the additional premium tax shall be collected by
the commissioner and deposited in the security fund to be allocated
to municipal policemen's and firemen's pension and relief funds and
twenty-five percent of the revenues shall be deposited by the
commissioner in the Fire Protection Fund to be allocated by the
State Treasurer to volunteer and part volunteer fire companies and
departments. In any year the actuarial report required by section
twenty, article twenty-two, chapter eight of this code indicates
no
actuarial deficiency in the a municipal policemen's or firemen's
pension and relief fund
has assets amounting to one hundred ten
percent of its actuarially accrued liabilities, no revenues may be
allocated from the Municipal Pensions and Protection Fund
or the
Municipal Pensions Security Fund to that
municipal pension and
relief fund. The revenues from the Municipal Pensions and
Protection Fund
or Municipal Pensions Security Fund shall then be
allocated to all other pension funds which have
an actuarial
deficiency not achieved a funding level of one hundred ten percent.
However, for plans with a funding level of at least one hundred ten
percent that are not eligible for revenue from the Municipal
Pensions Protection Fund or Municipal Pensions Security Fund, the
minimum standards for annual employer contributions after the first
day of July, two thousand eight, as defined in subsection (c),
section twenty, article twenty-two, chapter eight of this code,
shall equal the normal cost less the amortized value of the
actuarial surplus over a period of not more than forty years
beginning on the first day of July, two thousand eight. For this purpose, the actuarial surplus equals the excess of the actuarial
value of assets over the actuarial accrued liability as defined in
subdivision (1), subsection (c), section twenty, article twenty-
two, chapter eight of this code.
(3) The moneys, and the interest earned thereon, in the
municipal pensions and protection fund allocated to volunteer and
part volunteer fire companies and departments shall be allocated
and distributed quarterly to the volunteer fire companies and
departments. Before each distribution date, the State Fire Marshal
shall report to the State Treasurer the names and addresses of all
volunteer and part volunteer fire companies and departments within
the state which meet the eligibility requirements established in
section eight-a, article fifteen, chapter eight of this code.
(c) (1) Each municipal pension and relief fund shall have
allocated and authorized for distribution a pro rata share of the
revenues allocated to municipal policemen's and firemen's pension
and relief funds based upon the corresponding municipality's
average monthly number of members who worked at least one hundred
hours per month during the preceding fiscal year. On and after the
first day of July, one thousand nine hundred ninety-seven, from the
growth in any moneys collected pursuant to the tax imposed by this
section
and interest thereon there shall be allocated and
authorized for distribution to each municipal pension and relief
fund, a pro rata share of the revenues allocated to municipal
policemen's and firemen's pension and relief funds based upon the
corresponding municipalities average number of members who worked
at least one hundred hours per month and average monthly number of
retired members. For the purposes of this subsection, the growth in moneys collected from the tax collected pursuant to this section
is determined by subtracting the amount of the tax collected during
the fiscal year ending the thirtieth day of June, one thousand nine
hundred ninety-six, from the tax collected during the fiscal year
for which the allocation is being made
and interest thereon. All
moneys received by municipal pension and relief funds under this
section may be expended only for those purposes described in
sections sixteen through twenty-eight, inclusive, article twenty-
two, chapter eight of this code.
(2) Each volunteer fire company or department shall receive an
equal share of the revenues allocated for volunteer and part
volunteer fire companies and departments.
(3) In addition to the share allocated and distributed in
accordance with subdivision (1) of this subsection, each municipal
fire department composed of full-time paid members and volunteers
and part volunteer fire companies and departments shall receive a
share equal to the share distributed to volunteer fire companies
under subdivision (2) of this subsection reduced by an amount equal
to the share multiplied by the ratio of the number of full-time
paid fire department members who are also members of a municipal
firemen's pension system to the total number of members of the fire
department.
(d) The allocation and distribution of revenues provided
for
in this section are subject to the provisions of section twenty,
article twenty-two, chapter eight of this code and sections eight-a
and eight-b, article fifteen of said chapter.
§33-3-33. Surcharge on fire and casualty insurance policies to
benefit volunteer and part-volunteer fire departments and municipal pension plans; allocation
of proceeds; effective date.
(a)(1) For the purpose of providing additional revenue for
volunteer fire departments, part-volunteer fire departments and
certain retired teachers and the teachers retirement reserve fund
there is hereby authorized and imposed on and after the first day
of July, one thousand nine hundred ninety-two, on the policyholder
of any fire insurance policy or casualty insurance policy issued by
any insurer, authorized or unauthorized, or by any risk retention
group, a policy surcharge equal to one percent of the taxable
premium for each such policy. After the thirtieth day of June, two
thousand five, the surcharge shall be imposed as specified in
subdivisions (2) and (3) of this subsection.
(2) After the thirtieth day of June, two thousand five,
through the thirty-first day of December, two thousand five, for
the purpose of providing additional revenue for volunteer fire
departments, part-volunteer fire departments and to provide
additional revenue to the Public Employees Insurance Agency and
municipal pension plans, there is hereby authorized and imposed on
and after the first day of July, two thousand five, on the
policyholder of any fire insurance policy or casualty insurance
policy issued by any insurer, authorized or unauthorized, or by any
risk retention group, a policy surcharge equal to one percent of
the taxable premium for each such policy.
(3) (a) (1) After the thirty-first day of December, two
thousand five,
until the first day of July, two thousand eight, for
the purpose of providing additional revenue for volunteer fire
departments and part-volunteer fire departments, there is hereby authorized and imposed on the policyholder of any fire insurance
policy or casualty insurance policy issued by any insurer,
authorized or unauthorized, or by any risk retention group, a
policy surcharge equal to fifty-five one hundredths of one percent
of the taxable premium for each such policy.
(4) (2) For purposes of this section, casualty insurance may
not include insurance on the life of a debtor pursuant to or in
connection with a specific loan or other credit transaction or
insurance on a debtor to provide indemnity for payments becoming
due on a specific loan or other credit transaction while the debtor
is disabled as defined in the policy. The policy surcharge may not
be subject to premium taxes, agent commissions or any other
assessment against premiums.
(b) The policy surcharge shall be collected and remitted to
the commissioner by the insurer, or in the case of surplus lines
coverage, by the surplus lines licensee, or if the policy is issued
by a risk retention group, by the risk retention group. The amount
required to be collected under this section shall be remitted to
the commissioner on a quarterly basis on or before the twenty-fifth
day of the month succeeding the end of the quarter in which they
are collected, except for the fourth quarter for which the
surcharge shall be remitted on or before the first day of March of
the succeeding year.
(c) Any person failing or refusing to collect and remit to the
commissioner any policy surcharge and whose surcharge payments are
not postmarked by the due dates for quarterly filing is liable for
a civil penalty of up to one hundred dollars for each day of
delinquency, to be assessed by the commissioner. The commissioner may suspend the insurer, broker or risk retention group until all
surcharge payments and penalties are remitted in full to the
commissioner.
(d) (1) All money from the policy surcharge shall be collected
by the commissioner who shall disburse the money received from the
surcharge into a special account in the State Treasury, designated
the Fire Protection Fund. The net proceeds of this
portion of the
tax and the interest thereon, after appropriation by the
Legislature, shall be distributed quarterly on the first day of the
months of January, April, July and October to each volunteer fire
company or department on an equal share basis by the State
Treasurer.
After the thirtieth day of June, two thousand five, the
money received from the surcharge shall be distributed as specified
in subdivisions (2) and (3) of this subsection.
(2)(A) After the thirtieth day of June, two thousand five,
through the thirty-first day of December, two thousand five, all
money from the policy surcharge shall be collected by the
commissioner who shall disburse one half of the money received from
the surcharge into the Fire Protection Fund for distribution as
provided in subdivision (1) of this subsection.
(B) The remaining portion of moneys collected shall be
transferred into the fund in the State Treasury of the Public
Employees Insurance Agency into which are deposited the
proportionate shares made by agencies of this state of the Public
Employees Insurance Agency costs of those agencies, until the first
day of November, two thousand five. After the thirty-first day of
October, two thousand five, through the thirty-first day of
December, two thousand five, the remain portion shall be transferred to the special account in the State Treasury, known as
the Municipal Pensions and Protection Fund.
(3) (2) Except as provided in subsection (f) of this section,
after the thirty-first day of December, two thousand five, all
money from the policy surcharge shall be collected by the
commissioner who shall disburse all of the money received from the
surcharge into the Fire Protection Fund for distribution as
provided in subdivision (1) of this subsection.
(4) (3) Before each distribution date to volunteer fire
companies or departments, the State Fire Marshal shall report to
the State Treasurer the names and addresses of all volunteer and
part-volunteer fire companies and departments within the state
which meet the eligibility requirements established in section
eight-a, article fifteen, chapter eight of this code.
(e) The allocation, distribution and use of revenues provided
in the Fire Protection Fund are subject to the provisions of
sections eight-a and eight-b, article fifteen, chapter eight of
this code.
(f) Notwithstanding other provisions of this section,
beginning the first day of July, two thousand eight, for the
purpose of providing revenue for volunteer fire departments and
part-volunteer fire departments and for municipal policemen's
pension and relief funds and municipal firemen's pension and relief
funds, the policy surcharge authorized and imposed on the
policyholder of any fire insurance policy or casualty insurance
policy issued by any insurer, authorized or unauthorized, or by any
risk retention group, is equal to one percent of the taxable
premium for each policy. All money from the policy surcharge shall be collected by the commissioner who shall disburse fifty-five
percent of the money received from the one percent surcharge into
the Fire Protection Fund. Moneys deposited in the Fire Protection
Fund, and the interest thereon, after appropriation by the
Legislature, shall be distributed quarterly on the first day of the
months of January, April, July and October to each volunteer fire
company or department on an equal share basis by the State
Treasurer. Subject to provisions of section eighteen-b, article
twenty-two, chapter eight of this code, the remaining forty-five
percent of the proceeds shall be transferred to the Municipal
Pensions Security Fund. Surcharge proceeds collected by the
commissioner for the last six months of the calendar year two
thousand eight shall be allocated and distributed by the oversight
board to qualifying municipal policemen's and firemen's pension and
relief funds in the same manner as provided in subdivision (1),
subsection (c), section fourteen-d, article three of this chapter.
Beginning the first day of January, two thousand nine, all proceeds
from the 45-percent allocation for municipal policemen's and
firemen's pension and relief funds and the interest thereon, shall
be invested by the Municipal Pensions Oversight Board with the West
Virginia Investment Management Board and may not be allocated or
distributed for a period of five years. After five years, the
oversight board shall annually distribute one-fifth of the value of
the assets held by the West Virginia Investment Management Board on
behalf of the municipal pension oversight board to the eligible
municipal policemen's or firemen's pension and relief funds. To be
eligible to receive an allocation of moneys from the surcharge, a
municipal policemen's or firemen's pension and relief fund must have had contributions from all members in accordance with
provisions of subsection (c), section nineteen, article twenty-two,
chapter eight of this code and meet the minimum standards for
annual municipality contributions pursuant to subsection (c),
section twenty, article twenty-two, chapter eight of this code.
The distribution shall be allocated among policemen's and firemen's
pension and relief funds as provided in subdivision (1), subsection
(c), section fourteen-d, article three of this chapter.
_________
(NOTE: The purpose of this bill is to strengthen the
financial condition of municipal policemen's and firemen's pensions
and relief funds. The bill provides for new revenue by increased
contributions by active members and municipalities, by increased
insurance premium tax revenue dedicated to the funds, by
eliminating requirement of duplicate actuarial studies and by
improving investment returns by modifying investment flexibility
and oversight. All plans would be placed on an actuarially sound
payment scheme. State oversight would be enhanced by the creation
of The West Virginia Municipal Pensions Oversight Board, which
would be empowered to facilitate standardized procedures among all
plans, assist in training and advising local boards of trustees,
monitor investments, guard against fraud, provide physicians for
disability examinations, and report to the Legislature. Additional
revenue from insurance premium surcharge to be distributed among
the plans would be invested for five years with the West Virginia
Investment Management Board in an attempt to maximize investment
return for pension funds. The plans are authorized to make
short-term investments with the West Virginia Board of Treasury
Investments.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§18-22-18a, §18-22-18b and §33-2-15e are new; therefore,
strike-throughs and underscoring have been omitted.)
Email
Webmaster | © 2024 West Virginia Legislature **
