SENATE
HOUSE
JOINT
BILL STATUS
STATE LAW
REPORTS
EDUCATIONAL
CONTACT
home
home
Introduced Version House Bill 3158 History

OTHER VERSIONS  -  Committee Substitute  |  Engrossed Committee Substitute  |     |  Email
Key: Green = existing Code. Red = new code to be enacted

H. B. 3158


(By Delegates White, Boggs, Caputo, Fragale, Webster, Morgan, M. Poling, Campbell, Craig, Schadler and Rowan)

[Introduced March 16, 2009; referred to the

Committee on Finance.]




A BILL to amend and reenact §8-13C-1, §8-13C-2, §8-13C-3, §8-13C-4, §8-13C-5, §8-13C-9, §8-13C-11 and §8-13C-14 of the Code of West Virginia, 1931, as amended; to amend and reenact §8-15-8a and §8-15-8b of said code; to amend said code by adding thereto two new sections, designated §8-15-8d and §8-15-8e; 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 said code; to amend said code by adding thereto two new sections, designated §8- 22-18a and §8-22-18b; to amend said code by adding thereto a new section, designated §11-21-12i; to amend and reenact §12-4-14 of said code; to amend said code by adding thereto a new section, designated §33-2-15e; to amend and reenact §33-3-14d and §33-3-33 of said code; and to amend said code by adding thereto three new sections, designated §33-3-14e, §33-3-34 and §33-3-35, all relating to providing assistance to certain political subdivision activities involving municipal policemen's and firemen's pensions and relief systems and volunteer fire departments.

Be it enacted by the Legislature of West Virginia:
That §8-13C-1, §8-13C-2, §8-13C-3, §8-13C-4, §8-13C-5, §8-13C-9, §8-13C-11 and §8-13C-14 of the Code of West Virginia, 1931, as amended, be amended and reenacted; that §8-15-8a and §8-15-8b of said code be amended and reenacted; that said code be amended by adding thereto two new sections, designated §8-15-8d and §8-15-8e; 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 said code 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 §11-21-12i; that §12-4-14 of said code be amended and reenacted; that said code be amended by adding thereto a new section, designated §33-2-15e; that §33-3-14d and §33-3-33 of said code be amended and reenacted; and that said code be amended by adding thereto three new sections, designated §33-3-14e, §33-3-34 and §33-3-35, all to read as follows:
CHAPTER 8. MUNICIPAL CORPORATIONS.

8
ARTICLE 13C. MUNICIPAL TAX IN LIEU OF BUSINESS AND OCCUPATION TAX; AND MUNICIPAL TAXES APPLICABLE TO PENSION FUNDS; ADDITIONAL AUTHORITIES RELATING TO PENSIONS AND BOND ISSUANCE.

§8-13C-1. Findings.

The Legislature finds that:
(a) Imposing additional taxes creates an extra burden on the citizens of the state;
(b) Imposing additional taxes can be detrimental to the economy of the state;
(c) Imposing additional taxes is only proper under certain circumstances;
(d) For many municipalities with severe unfunded liabilities of the police and fire pension funds, all available sources of local revenue have been exhausted. Property taxes are at the maximum allowed by the state Constitution and local business and occupation taxes and utility taxes are at the maximum rates allowed by state law. Other fees have reached the economic maximum and are causing relocation of business outside the municipal boundaries;
(e) For many municipalities with severe unfunded police and fire pension fund liabilities, revenue from existing sources has become stagnant over the past few years with no expectation of significant future growth;
(f) For many municipalities with severe unfunded police and fire pension fund liabilities, payments required under state law to fund fire and police pension funds are now close to equaling the city payrolls for police and fire protection and will rise to exceed those payrolls within a ten-year period;
(g) For many municipalities with severe unfunded police and fire pension fund liabilities, payments required under state law to fund fire and police pension funds now constitute a large percentage of those municipalities' total budget and will rise to an even larger percentage of the available revenues in the next ten years. Payment and benefit levels are dictated to the municipalities by state law;
(h) As the required pension payments rise, many of the municipalities with severe unfunded police and fire pension fund liabilities will find it impossible to maintain at minimum levels necessary and proper city services including, but not limited to, police and fire protection, street maintenance and repair and sanitary services;
(i) For some of the municipalities with severe unfunded liabilities of the police and fire pension funds, the combination of the steeply rising pension obligations and the stagnant revenue sources raise the real possibility of municipal bankruptcy in the near and predictable future. If this happens, pensioners would either not receive the full benefits which they have been promised or pressure would be placed on the state to fund these programs;
(j) For a municipality that has the most severe a significant unfunded liability in its pension funds, paying off the unfunded liability in a timely manner would cause tremendous financial hardship and the loss of many services that would otherwise be provided to the municipality's citizens;
(k) Only for a municipality that has the most severe unfunded liability in its pension funds would the The imposition of the pension relief municipal occupational tax, the pension relief municipal sales and service tax, the pension relief municipal use tax or any combination of those taxes would be an appropriate method for a municipality that has a significant unfunded liability in its pension funds of addressing to address the unfunded liability; and
(l) Only for a municipality that does not impose or ceases to impose a business and occupation or privilege tax would the imposition of an alternative municipal sales and service tax and an alternative municipal use tax be appropriate;
(m) Only for a municipality that has the most severe unfunded liability in its pension funds would the closure of its existing pension and relief fund plan for policemen and firemen to those newly employed and the creation of a defined contribution plan for newly employed policemen and firemen be appropriate; and
(n) Only for a municipality that has the most severe unfunded liability in its pension funds, that closes its existing pension and relief fund plan for policemen and firemen to those newly employed and that creates a defined contribution plan for newly employed police officers and firefighters, would the issuance of bonds to address the unfunded liability of its existing pension and relief fund plan for policemen and firemen be appropriate.
(o) No amendment to this article enacted during the third extraordinary session of the Legislature held during calendar year two thousand five may be interpreted or construed to allow a municipality to adopt by ordinance a sales or use tax, by whatever name called, that imposes either tax prior to the first day of July, two thousand eight
.
§8-13C-2. Definitions.
For the purposes of this article:
(a) "Alternative municipal sales and service tax" means the tax authorized to be imposed by subsection (b), section four of this article only if a municipality does not impose or ceases to impose the business and occupation or privilege tax authorized in section five, article thirteen of this chapter;
(b) "Alternative municipal use tax" means the tax authorized to be imposed by subsection (b), section five of this article only if a municipality does not impose or ceases to impose the business and occupation or privilege tax authorized in section five, article thirteen of this chapter;
(c) "Qualifying municipality" means any municipality, as defined in section two, article one of this chapter:
(1) In which the weighted average of the percentages to which its policemen's and firemen's pension and relief funds are fully funded is three fifty percent or less on the date of adoption of the ordinance imposing the tax; and
(2) That has satisfied the requirements set forth in section eleven of this article;
(d) "Pension relief municipal occupational tax" means the tax authorized to be imposed by section three of this article and for which the use of the proceeds of the tax are restricted by section nine of this article;
(e) "Pension relief municipal sales and service tax" means the tax authorized to be imposed by subsection (a), section four of this article and for which the use of the proceeds of the tax are restricted by section nine of this article;
(f) "Pension relief municipal use tax" means the tax authorized to be imposed by subsection (a), section five of this article and for which the use of the proceeds of the tax are restricted by section nine of this article; and
(g) "Taxable employee" means, with respect to each calendar year, any individual:
(1) Who holds employment within the qualifying municipality with an employer with a place of business located within the qualifying municipality electing to impose the municipal payroll tax a pension relief municipal occupational tax pursuant to this article; and
(2) Whose salaries, wages, commissions and other earned income that would be included in federal adjusted gross income for the calendar year is more than $10,000 per year.
§8-13C-3. Pension relief municipal occupational tax.
(a) Effective on and after July 1, 2005, each qualifying municipality, as defined in section two of this article, has the plenary power and authority to impose, by ordinance, a pension relief municipal occupational tax on taxable employees. Any pension relief municipal occupational tax imposed pursuant to this section shall meet the following requirements:
(1) The tax shall be imposed at a rate of one percent or less;
(2) The tax shall be imposed at a uniform rate; and
(3) The tax rate shall be applied only to salaries, wages, commissions and other earned income of taxable employees that would be included in federal adjusted gross income for the year. The tax rate may not be applied to other forms of income including, but not limited to, intangible income and net profit from a business.
(b) Each employer with a taxable employee, during each pay period, shall withhold from the taxable employee's salary the amount of the tax as computed by applying the appropriate tax rate to the taxable employee's salary during that pay period and remit the withholdings to the appropriate municipal taxing authority.
§8-13C-4. Municipal sales and service taxes.
(a) Pension relief municipal sales tax. -- On and after July 1, 2005, each qualifying municipality, as defined in section two of this article, has the plenary power and authority to impose, by ordinance, a pension relief municipal sales and service tax at a rate not to exceed one percent, subject to the provisions of this article: Provided, That: (1) The tax does not apply to any purchase of tangible personal property, custom software or the results of taxable services in a transaction completed within the corporate limits of the municipality before the first day of July, two thousand eight, or before such later date specified in the ordinance of the municipality imposing the tax; and (2) the effective date of the tax, or of a change in the rate of the tax, shall be no earlier than the first day of a calendar quarter that at a minimum begins one hundred eighty days after notice of the tax, or of a change in the rate of tax, is provided to the Tax Commissioner as provided in section six of this article.
(b) Alternative municipal sales tax. - On and after July 1, 2005, notwithstanding subsection (a) of this section, and in addition thereto in the case of a qualifying municipality, any municipality that does not impose, or ceases to impose, the business and occupation or privilege tax authorized by section five, article thirteen of this chapter has the plenary power and authority to impose, by ordinance, an alternative municipal sales and service tax at a rate not to exceed one percent, subject to the provisions of this article: Provided, That: (1) The tax does not apply to any purchase of tangible personal property, custom software or the results of taxable services in a transaction completed within the corporate limits of the municipality before the first day of July, two thousand eight, or before such later date specified in the ordinance of the municipality imposing the tax; and (2) the effective date of the tax, or of a change in the rate of the tax, shall be no earlier than the first day of a calendar quarter that at a minimum begins one hundred eighty days after notice of the tax, or of a change in the rate of tax, is provided to the Tax Commissioner as provided in section six of this article.
(c) Uniformity of tax base. -- Any municipal sales and service tax imposed under the authority granted by this section is subject to the following:
(1) The base of a municipal sales and service tax imposed pursuant to this section shall be identical to the base of the consumers sales and service tax imposed pursuant to article fifteen, chapter eleven of this code on sales made and services rendered within the boundaries of the municipality, subject to the following:
(A) Except for the exemption provided in section nine-f, article fifteen, chapter eleven of this code, all exemptions and exceptions from consumers sales and service tax apply to a municipal sales and service tax imposed pursuant to this section; and
(B) Sales of gasoline and special fuel are not subject to a municipal sales and service tax imposed pursuant to this section;
(2) Any municipal sales and service tax imposed pursuant to this section applies solely to tangible personal property, custom software and services that are sourced to the municipality. The sourcing rules set forth in article fifteen-b, chapter eleven of this code, including any amendments thereto, apply to municipal sales and use taxes levied pursuant to this article.
(d) Notification of Tax Commissioner. -- Any municipality that imposes a municipal sales and service tax pursuant to this section or changes the rate of a municipal sales and service tax imposed pursuant to this section shall notify the Tax Commissioner pursuant to section six of this article.
(e) State level administration required. -- Any municipality that imposes a municipal sales and service tax pursuant to this section may not administer or collect the tax, but shall use the services of the Tax Commissioner to administer, enforce and collect the tax.
(f) Tax in addition to state use tax. -- Any municipal sales and service tax imposed pursuant to this section shall be imposed in addition to the consumers sales and service tax imposed pursuant to article fifteen, chapter eleven of this code on sales made and services rendered within the boundaries of the municipality and, except as exempted or excepted, all sales made and services rendered within the boundaries of the municipality shall remain subject to the tax levied by that article.
(g) Tax in addition to special district tax. -- Any municipal sales and service tax imposed pursuant to this section shall be imposed in addition to any tax imposed pursuant to section one, article eighteen, chapter seven of this code, sections six and seven, article thirteen of this chapter and section twelve, article thirty-eight of this chapter.
§8-13C-5. Municipal use tax.
(a) Pension relief municipal use tax. -- On and after July 1, 2005, each qualifying municipality, as defined in section two of this article, that imposes a pension relief municipal sales and service tax pursuant to this article shall impose, by ordinance, a pension relief municipal use tax at the same rate that is set for the pension relief municipal sales and service tax: Provided, That: (1) The tax does not apply to any use of tangible personal property, custom software or the results of taxable services in the corporate limits of the municipality where the first use occurs before the first day of July, two thousand eight, or before such later date specified in the ordinance of the municipality imposing the tax; and (2) the effective date of the tax, or of a change in the rate of the tax, shall be no earlier than the first day of a calendar quarter that at a minimum begins one hundred eighty days after notice of the tax, or of a change in the rate of tax, is provided to the Tax Commissioner as provided in section six of this article.
(b) Alternative municipal use tax. -- On and after July 1, 2005, each municipality that imposes an alternative municipal sales and service tax pursuant to this article shall impose, by ordinance, an alternative municipal use tax at the same rate that is set for the alternative municipal sales and service tax: Provided, That: (1) The tax does not apply to any use of tangible personal property, custom software or the results of taxable services in the corporate limits of the municipality where the first use occurs before the first day of July, two thousand eight, or before such later date specified in the ordinance of the municipality imposing the tax; and (2) the effective date of the tax, or of a change in the rate of the tax, shall be no earlier than the first day of a calendar quarter that at a minimum begins one hundred eighty days after notice of the tax, or of a change in the rate of tax, is provided to the Tax Commissioner as provided in section six of this article.
(c) Uniformity of tax base. -- The base of a municipal use tax imposed pursuant to this section shall be identical to the base of the use tax imposed pursuant to article fifteen-a, chapter eleven of this code on the use of tangible personal property, custom software and taxable services within the boundaries of the municipality, subject to the following:
(1) Except for the exemption provided in section nine-f, article fifteen, chapter eleven of this code, all exemptions and exceptions from the use tax apply to a municipal use tax imposed pursuant to this section; and
(2) Uses of gasoline and special fuel are not subject to a municipal use tax imposed pursuant to this section when the use is subject to the tax imposed by article fourteen-c, chapter eleven of this code.
(d) Notification to Tax Commissioner. -- Any municipality that imposes a municipal use tax pursuant to this section or changes the rate of a municipal use tax imposed pursuant to this section shall notify the Tax Commissioner pursuant to section six of this article.
(e) State level administration required. -- Any municipality that imposes a municipal use tax pursuant to this section may not administer or collect the tax, but shall use the services of the Tax Commissioner to administer, enforce and collect the taxes.
(f) Tax in addition to state use tax. -- Any municipal use tax imposed pursuant to this section shall be imposed in addition to the use tax imposed pursuant to article fifteen-a, chapter eleven of this code on the use of tangible personal property, custom software or taxable services within the boundaries of the municipality and, except as exempted or excepted, all use of tangible personal property, custom software or taxable services within the boundaries of the municipality shall remain subject to the tax levied by said article.
(g) Tax in addition to special district tax. -- Any municipal use tax imposed pursuant to this section shall be imposed in addition to any tax imposed pursuant to section one, article eighteen, chapter seven of this code, sections six and seven, article thirteen of this chapter and section twelve, article thirty-eight of this chapter.
§8-13C-9. Restriction on use of certain revenues.
(a) All proceeds from a pension relief municipal occupational tax, a pension relief municipal sales and service tax and a pension relief municipal use tax imposed pursuant to this article shall be used solely for one of the following purposes:
(1) Directly reducing the unfunded actuarial accrued liability of policemen's and firemen's pension and relief funds of the qualifying municipality imposing the tax; or
(2) Meeting the principal, interest and any reserve requirement obligations of any bonds issued pursuant to section fourteen of this article.
(b) For any qualifying municipality that chooses to apply the proceeds from a pension relief municipal occupational tax, a pension relief municipal sales and service tax, a pension relief municipal use tax or any permitted combination of these taxes directly to reducing the unfunded actuarial accrued liability of policemen's and firemen's pension and relief funds, the qualifying municipality loses its authority to impose those taxes after:
(1) The municipality fails to annually fund, at a minimum, all normal costs of the qualifying municipality's policemen's and firemen's pension and relief funds as determined by the consulting actuary as provided under section twenty-a, article twenty-two of this chapter; or
(2) The unfunded actuarial accrued liability of the qualifying municipality's policemen's and firemen's pension and relief funds is eliminated; or
(3) Sufficient moneys accrue from the proceeds of the pension relief municipal occupational tax, the pension relief municipal sales and service tax, the pension relief municipal use tax or any permitted combination of these taxes to eliminate the unfunded actuarial accrued liability of the qualifying municipality's policemen's and firemen's pension and relief funds.
(c) For any qualifying municipality that chooses to apply the proceeds from a pension relief municipal occupational tax, a pension relief municipal sales and service tax, a pension relief municipal use tax or any permitted combination of these taxes to the principal, interest and any reserve requirement and arbitrage rebate obligations on any bonds issued pursuant to section fourteen of this article, the qualifying municipality loses its authority to impose those taxes after:
(1) The principal, interest and any reserve requirement and arbitrage rebate obligations on the bonds issued pursuant to section fourteen of this article are met;
(2) Sufficient moneys accrue from the proceeds of the pension relief municipal occupational tax, the pension relief municipal sales and service tax, the pension relief municipal use tax or any permitted combination of these taxes to meet the principal, interest and any reserve requirement and arbitrage rebate obligations on the bonds issued pursuant to section fourteen of this article; and
(3) After retirement of bonds issued pursuant to section fourteen of this article, any unfunded actuarial accrued liability of the qualifying municipality's pension and relief funds for policemen and firemen is eliminated.
§8-13C-11. Additional requirements for authority to impose certain taxes.

(a) The authority to impose the pension relief municipal occupational tax, the pension relief municipal sales and service tax and the pension relief municipal use tax, all provided in this article, is not effective until a municipality wishing to impose the taxes presents to the joint committee on government and finance a plan to remove the unfunded liabilities of its policemen's and firemen's pension funds and the necessary changes in West Virginia law have been enacted to allow for implementation of the municipal plan.
(b) Notwithstanding any other provision of this code to the contrary, no cost-of-living increases or other benefit increases, except as may be provided pursuant to section twenty-six-a, article twenty-two of this chapter, and no new benefits, may be granted to or received by any member or beneficiary of a policemen's and firemen's pension and relief funds of a municipality during any period that the municipality imposes a pension relief municipal occupational tax, a pension relief municipal sales and service tax, the pension relief municipal use tax or any combination thereof authorized under this chapter.
§8-13C-14. Authorization for closure of existing retirement plans, creation of defined contribution plans and issuance of bonds for certain qualifying municipalities.

(a) Notwithstanding any other section of this code to the contrary and subject to subsection (b) of this section, any qualifying municipality, as that term is defined in section two of this article, has the following authority:
(1) To close its existing pension and relief fund plan for policemen and firemen provided in article twenty-two of this chapter for policemen and firemen hired on and after a future date to be set by the governing body of the municipality;
(2) To establish a defined contribution plan for police officers and firefighters hired on and after the future date set by the governing body of the municipality to close its existing pension and relief fund plan for policemen and firemen; and
(3) To issue revenue bonds for the purpose of eliminating the unfunded actuarial accrued liability of the existing pension and relief fund plan for policemen and firemen and to issue refunding bonds issued to refund, in whole or in part, bonds issued for such purpose.
(b) The authority granted in subsection (a) of this section is subject to the following:
(1) No qualifying municipality may close an existing pension and relief fund plan for policemen and firemen pursuant to subdivision (1), subsection (a) of this section unless:
(A) The
the qualifying municipality issues revenue bonds for the purpose of eliminating the unfunded actuarial accrued liability of the existing pension and relief fund plan for policemen and firemen; and
(B) The qualifying municipality establishes a defined contribution plan for police officers and firefighters pursuant to subdivision (2), subsection (a) of this section;

(2) No qualifying municipality may establish a defined contribution plan for police officers and firefighters pursuant to subdivision (2), subsection (a) of this section unless:
(A) The qualifying municipality closes its existing pension and relief fund plan for policemen and firemen pursuant to subdivision (1), subsection (a) of this section; and
(B) The qualifying municipality issues revenue bonds for the purpose of eliminating the unfunded actuarial accrued liability of the existing pension and relief fund plan for policemen and firemen;
(3) No qualifying municipality may issue bonds pursuant to subdivision (3), subsection (a) of this section unless:
(A) The qualifying municipality closes its existing pension and relief fund plan for policemen and firemen pursuant to subdivision (1), subsection (a) of this section; and
(B) The qualifying municipality establishes a defined contribution plan for police officers and firefighters pursuant to subdivision (2), subsection (a) of this section;
(4)(3) No qualifying municipality may exercise any authority provided in subsection (a) of this section unless it obtains a determination of the unfunded actuarial accrued liability of its existing pension and relief fund plans for policemen and firemen from the State Treasurer;
(5)(4) If the qualifying municipality elects to issue bonds pursuant to subdivision (3), subsection (a) of this section, the following applies:
(A) The proceeds of the revenue bonds shall be at least equal to the unfunded actuarial accrued liability as determined by the State Treasurer Municipal Pensions Oversight Board plus any reserve fund requirements and any costs, including accrued or capitalized interest, associated with issuing the bonds. All of the proceeds shall be applied to the payment of the unfunded actuarial accrued liability, the funding of reserve requirements and the payment of costs associated with the issuance of the bonds and may not be used for any other purpose;
(B) The proceeds of any refunding bonds shall be used to refund all or any portion of the revenue bonds authorized in this section, to fund any required reserve requirements for the refunding bonds and to pay costs of issuance associated with the refunding bonds and for no other purpose; and
(C) Notwithstanding any other provision of this code to the contrary, the proceeds of the bonds or refunding bonds shall be invested with the West Virginia Investment Management Board established under the provisions of article six, chapter twelve of this code; and
(D) Any bonds issued pursuant to this article shall be guaranteed through a municipal bond insurance policy, a letter of credit or some other form of commonly used commercial guaranty that shifts the credit risk associated with the debt service payments on the bonds to the guarantor; and
(E) The bonds and any offering document associated with the bonds shall contain the following legend: "The bonds are limited obligations of [the qualifying municipality] and are not a lien or charge upon the funds or property of [the qualifying municipality], except to the extent of the pledge of [pension relief taxes]. The bonds shall not constitute general obligations of either the [qualifying municipality] or the state of West Virginia and under no circumstances shall the bonds be payable from, nor shall the holders thereof have any rightful claim to, any income, revenues, funds or assets of the [qualifying municipality] or the state of West Virginia other than from the [pension relief taxes] pledged to the payment of the bonds. The bonds are not a moral obligation of the state of West Virginia or in any way secured by the assets of the state of West Virginia. In the event of a default with respect to the bonds, the state of West Virginia will not cure such default or provide any funds to cure such default. The holders of the bonds shall rely solely upon the [pension relief taxes] for repayment of this bond."
(6)(5)If the qualifying municipality elects to issue bonds pursuant to subdivision (3), subsection (a) of this section, the qualifying municipality shall impose a pension relief municipal occupational tax, a pension relief municipal sales and service tax, a pension relief municipal use tax or any permitted combination of these taxes at a rate projected to generate sufficient revenue to meet the principal, interest and any reserve requirement and arbitrage rebate obligations on the bonds, subject to the following:
(A) This requirement is void after the qualifying municipality loses its authority to impose those taxes pursuant to subsection (b) or (c), section nine of this article; and
(B) If the revenue generated by a pension relief municipal occupational tax, a pension relief municipal sales and service tax and a pension relief municipal use tax is insufficient to meet the principal, interest and any reserve requirement and arbitrage rebate obligations on the bonds, the qualifying municipality shall not issue the bonds;
(7)(6) If the qualifying municipality elects to issue bonds pursuant to subdivision (3), subsection (a) of this section, all proceeds from a pension relief municipal occupational tax, a pension relief municipal sales and service tax, a pension relief municipal use tax or any permitted combination of these taxes shall be dedicated solely to paying the principal, interest and any reserve requirement and arbitrage rebate obligations on the bonds;
(8)(7) If the qualifying municipality elects to close an existing pension and relief fund plan for policemen and firemen pursuant to subdivision (1), subsection (a) of this section, all current and retired employees in the existing pension and relief fund plans for policemen and firemen shall remain in that plan and shall be paid all benefits of that plan in accordance with Part III, article twenty-two of this chapter;
(9)(8) Any such revenue bonds or refunding bonds shall bear interest at not more than twelve percent per annum, payable semiannually, or at shorter intervals, and shall mature at such time or times, not exceeding thirty years, as may be determined by the ordinance authorizing the issuance of the bonds. The bonds may be made redeemable before maturity, at the option of the municipality at not more than the par value thereof, plus a premium of not more than five percent, under such terms and conditions as may be fixed by the ordinance authorizing the issuance of the bonds. The principal and interest of the bonds may be made payable in any lawful medium. The ordinance shall determine the form of the bonds and shall set forth any registration or conversion privileges, and shall fix the denomination or denominations of such bonds, and the place or places of the payment of principal and interest thereof, which may be at any banking institution or trust company within or without the state. The bonds shall contain a statement on their face that the municipality shall not be obligated to pay the same, or the interest thereon, except from the special fund derived from revenues collected by the municipality from the imposition of a pension relief municipal occupational tax, a pension relief municipal sales and service tax, a pension relief municipal use tax or any permitted combination of these taxes and which the municipality may pledge as security for the bonds. All the bonds shall be, and shall have and are hereby declared to have all the qualities and incidents of negotiable instruments, under the Uniform Commercial Code of the state. The bonds shall be executed in such manner as the governing body of the municipality may direct. The bonds shall be sold by the municipality in such manner as may be determined to be for the best interest of the municipality. Any surplus of the bond proceeds over and above the cost of paying the unfunded liability, plus any amount required for reserves, capitalized interest and costs of issuance thereof or in the case of refunding bonds over and above the amount necessary to refund the existing bonds being refunded by such issue, plus any amount required for reserves, capitalized interest and costs of issuance thereof, shall be paid into the debt service fund for such bonds; and
(10)(9) The A defined contribution plan established by the municipality shall:
(A) Meet the federal qualification requirements of 26 U.S.C. §401 and related sections of the Internal Revenue Code as applicable to governmental plans Satisfy, in both form and operation, the tax qualification requirements of § 401(a) or 457(b) and related sections of the Internal Revenue Code of 1986 (including successors thereto and amendments thereof), as applicable to governmental plans, and the qualifying municipality shall adopt a written plan document which embodies the requirements of this article, including applicable federal qualification requirements and, shall have the authority to promulgate rules and to amend the plan as may be required from time to time to effect the intent of this provision;
(B) Set the amount of each employee's contribution and the amount of each employer's contribution;
(C) Require that the amount of annuity payments a retired member receives be based solely upon the balance in the member's annuity account at the date of retirement, the retirement option selected, or in the event of an annuity option being selected, the actuarial life expectancy of the member of any other factors that normally govern annuity payments;
(D) Include detailed provisions that require the prudent and safe handling of the retirement funds for the exclusive benefit of the plan and its participants and beneficiaries, including without limitation, rules which provide for the investment of retirement funds, in accordance with fiduciary standards imposed by state law and the Internal Revenue Code of 1986 (including successors thereto and amendments thereof), as applicable to governmental plan. The qualifying municipality may elect to provide that individual participants and beneficiaries may exercise control over the investment of the assets held in their respective individual accounts. To the extent that a participant or beneficiary exercises such investment control over his or her account, no person who is otherwise a fiduciary shall be liable for any loss, or by reason of any breach, which results from such participant's or beneficiary's exercise of control, to the extent allowed by law;
(E) Provide retirement options; and
(F) Include any other provision and authorize any policy that the qualifying municipality determines is necessary or incidental to the establishment and operation of the defined contribution plan. The other provisions may include, but are not limited to, the authorization to contract with one or more private pension, insurance, annuity, mutual fund or other qualified company or companies to administer the day-to-day operations of the plan and to provide investments.
(c) If a qualifying municipality elects to establish a defined contribution plan pursuant to subdivision (2), subsection (a) of this section, the qualifying municipality shall also establish, by ordinance, mechanisms to provide disability benefits and death benefits for eligible members.
(d) The authority granted to a qualifying municipality pursuant to subsection (a) of this section to close its existing pension and relief fund plan for police officers and firefighters, to establish a defined contribution plan for police officers and firefighters and to issue revenue bonds shall terminate on the thirty-first day of December, two thousand five A person who becomes a participant in a defined contribution plan established by a qualifying municipality under this article shall not accrue benefits or other rights (or in the case of a re-employed individual, any additional benefits or additional rights) under a defined benefit plan sponsored by the same qualifying municipality under article twenty-two of this chapter with respect to the same period of service.
(e) The right of any person to a benefit provided under a defined contribution plan established by a qualifying municipality pursuant to this section shall not be subjected to execution, attachment, garnishment, the operation of bankruptcy or insolvency laws, or other process whatsoever nor shall any assignment thereof be enforceable in any court with the exception that the benefits or contributions under the plan shall be subject to "qualified domestic relations orders" as that term is defined in 26 U.S.C. §414 with respect to governmental plans.
(f) The interest earned on any bonds issued under the authority granted in this section is exempt from any tax imposed under the provisions of this code.
(g) Bonds and refunding bonds issued pursuant to the authority provided by this section shall never constitute a direct and general obligation of the State of West Virginia and the full faith and credit of the state is not pledged to secure the payment of the principal and interest of such bonds. Bonds and refunding bonds issued under this section shall state on their face that the bonds or bonds do not constitute a debt of the State of West Virginia and that payment of the bonds, interest and charges thereon cannot become an obligation of the State of West Virginia.
ARTICLE 15. FIRE FIGHTING; FIRE COMPANIES AND DEPARTMENTS; CIVIL SERVICE FOR PAID FIRE DEPARTMENTS.
§8-15-8a. Eligibility for allocation from Municipal Pensions and Protection Fund or the Fire Protection Fund.
In order To be eligible to receive revenues allocated from the Municipal Pensions and Protection Fund or the Fire Protection Fund, each volunteer or part volunteer fire company or department must meet the requirements listed in subdivisions (a) through (c) (d) of this section.
Each volunteer or part volunteer fire company or department must:
(a) Submit and maintain current submission of fire loss data to the state fire marshal, including verification, by notarized statement, if no fire loss has occurred;
(b) Complete or be in the process of receiving firefighters training, including section one of the West Virginia university fire service extension or its equivalent. Such fire company or department must have at least ten members certified as having completed such training or if a volunteer fire company or department has twenty or fewer members, fifty percent of the active volunteer members must have completed such training; and
(c) Comply with the sworn statement of annual expenditures or report requirements set forth in section eight-d of this article; and
(c)(d) Comply with all other applicable federal and state laws.
§8-15-8b. Authorized expenditures of monies from the Municipal Pensions and Protection Fund or the Fire Protection Fund; redistribution upon decertification.
(a) Revenues Monies allocated from the Fire Protection Fund to volunteer and part volunteer fire companies and departments may be expended only for the items listed in subdivisions (1) through (12) (13) of this section subsection.
Funds Monies received from the State for volunteer and part volunteer fire companies and departments, pursuant to sections fourteen-d and thirty-three section thirty-four, article three, and section sixteen-a, article twelve seven, article twelve-c, all of chapter thirty-three of this code, may not be commingled with funds received from any other source. Expenditures may be made for the following:
(1) Personal protective equipment, including protective head gear, bunker coats, pants, boots, combination of bunker pants and boots, coats and gloves;
(2) Equipment for compliance with the national fire protection standard or automotive fire apparatus, NFPA-1901;
(3) Compliance with insurance service office recommendations relating to fire departments;
(4) Rescue equipment, communications equipment and ambulance equipment: Provided, That no moneys received from the municipal pensions and protection fund or the fire protection fund may be used for equipment for personal vehicles owned or operated by volunteer fire company or department members;
(5) Capital improvements reasonably required for effective and efficient fire protection service and maintenance of the capital improvements;
(6) Retirement of debts;
(7) Payment of utility bills;
(8) Payment of the cost of immunizations, including any laboratory work incident to the immunizations, for firefighters against hepatitis-b and other blood borne pathogens: Provided, That the vaccine shall be purchased through the state immunization program or from the lowest cost vendor available: Provided, however, That volunteer and part volunteer fire companies and departments shall seek to obtain no cost administration of the vaccinations through local boards of health: Provided further, That in the event any volunteer or part volunteer fire company or department is unable to obtain no cost administration of the vaccinations through a local board of health, the company or department shall seek to obtain the lowest cost available for the administration of the vaccinations from a licensed health care provider;
(9) Any filing fee required to be paid to the Legislative Auditor's Office under section fourteen, article four, chapter twelve of this code relating to sworn statements of annual expenditures submitted by volunteer or part volunteer fire companies or departments that receive state funds or grants;
(10) (9) Property/casualty insurance premiums for protection and indemnification against loss or damage or liability;
(11)(10) Operating expenses reasonably required in the normal course of providing effective and efficient fire protection service, which include, but are not limited to, gasoline, bank fees, postage and accounting costs; and
(12)(11) Dues paid to national, state and county associations.
(b) If a volunteer or part volunteer fire company or department purchases an item with monies allocated from the Fire Protection Fund and the item is subsequently sold, any monies derived by the company or department from the sale of that item shall be expended in accordance with the provisions of subsection (a) of this section.
(c) If the State Fire Marshal issues a cease and desist order to a volunteer or part volunteer fire company or department to stop operations after the State Fire Commission has withdrawn certification pursuant to article three, chapter twenty-nine of this code, the State Fire Marshal shall, within sixty days of the cease and desist order, transfer any unexpended, unencumbered monies which were allocated to the volunteer fire company or department from the Fire Protection Fund to a special revenue account hereby created in the State Treasury, designated the "Volunteer Fire Department Decertification Account." The next following quarter the State Treasurer shall pay the amount held in the special revenue account to the Fire Protection Fund to be redistributed to eligible volunteer fire companies or departments.
(d) If the State Fire Marshal issues a cease and desist order to a volunteer or part volunteer fire company or department to stop operations after the State Fire Commission has withdrawn certification pursuant to the provisions of article three, chapter twenty-nine of this code, the State Fire Marshal shall, within one year of the cease and desist order, implement one of the following options to sell or transfer any items purchased by the decertified volunteer fire company or department with monies allocated from the Fire Protection Fund:
(1) If the item was purchased solely with monies allocated from the Fire Protection Fund, the State Fire Marshal may transfer the item to another volunteer fire company or department, with priority given to companies or departments located in the municipality or county in which the decertified company or department was located;
(2) If the item was purchased solely with monies allocated from the Fire Protection Fund, the State Fire Marshal may sell the item and any monies derived from the sale of that item shall be placed in the Volunteer Fire Department Decertification Account. The next following quarter the State Treasurer shall pay the amount held in the special revenue account to the Fire Protection Fund to be redistributed to eligible volunteer fire companies or departments;
(3) If the item was purchased with monies allocated from the Fire Protection Fund and monies allocated from municipal or county sources, the State Fire Marshal may transfer the item to another volunteer fire company or department in the municipality or county where the decertified company or department is located if each municipality or county which allocated monies towards the purchase of the item agrees to the transfer; or
(4) If the item was purchased with monies allocated from the Fire Protection Fund and monies allocated from municipal, county or other sources, the State Fire Marshal may sell the item and distribute the proceeds derived from the sale on a pro-rata basis according to the State Fire Marshal's reasonable approximation of the percentage of monies allocated from each funding source for the purchase of the item. Any monies derived from the sale which are attributable to allocations from the Fire Protection Fund shall be placed in the Volunteer Fire Department Decertification Account. The next following quarter the State Treasurer shall pay the amount held in the special revenue account to the Fire Protection Fund to be redistributed to eligible volunteer fire companies or departments.
(e) The State Fire Marshal shall propose rules for legislative approval in accordance with the provisions of article three, chapter twenty-nine-a of this code to establish criteria for the sale or transfer of items or monies pursuant to the provisions of subsections (c) and (d) of this section and to otherwise implement the provisions of subsections (c) and (d).
§8-15-8d. Sworn statement of annual expenditures or report by volunteer or part volunteer fire companies or departments; penalties for noncompliance; penalties for fraudulent statement.
(a) Volunteer or part volunteer fire companies or departments receiving formula distributions pursuant to sections thirty-four, article three, and section seven, article twelve-c, all of chapter thirty-three of this code, shall either:
(1) File a report, as defined in section fourteen, article four, chapter twelve of this Code, with the Legislative Auditor on or before July 1 of each year. The report shall be made by an independent certified public accountant at the cost of the volunteer fire company or department. The scope of the report is limited to showing that the funds distributed were spent for authorized purposes; or
(2) File a sworn statement of annual expenditures with the Legislative Auditor on or before July 1 of each year. The sworn statement of expenditures shall be signed by the chief or director of the volunteer fire company or department and shall be made under oath and acknowledged before a notary public.
(b) If the sworn statement of annual expenditures or report required by this section is not filed with the Legislative Auditor by July 1, or unless the time period is extended by the Legislative Auditor, the Legislative Auditor shall notify the State Treasurer who shall withhold payment of any amount that would otherwise be distributed to the volunteer fire company or department under the provisions of section thirty-four, article three, and section seven, article twelve-c, all of chapter thirty-three of this code, until the report is submitted to the Legislative Auditor. Moneys withheld pursuant to this subsection (b) shall be deposited quarterly in the Volunteer Fire Department Audit Account," created in subsection (c) of this section.
(c) The Legislative Auditor may assign an employee or employees to perform audits or reviews at the direction of the Legislative Auditor of the disbursement of state grant funds to volunteer fire departments. The volunteer fire company or department shall cooperate with the Legislative Auditor, the Legislative Auditor's employees and the State Auditor in performing their duties under this section. If a volunteer fire company or department does not cooperate as required by the provisions of this section, the Legislative Auditor shall notify the State Treasurer, who shall withhold payment of any amount that would otherwise be distributed to the volunteer fire company or department under the provisions of section thirty-four, article three, and section seven, article twelve-c, all of chapter thirty-three of this code, until the Legislative Auditor notifies the Treasurer that the volunteer fire company or department has complied with the provisions of this section. The State Treasurer shall quarterly pay the amount withheld into a special revenue account hereby created in the State Treasury, designated the "Volunteer Fire Department Audit Account". Upon notice from the Legislative Auditor that a volunteer fire company or department has not complied with the provisions of this section for four consecutive quarters, the next following quarter the State Treasurer shall pay the amount withheld in the special revenue account to the Fire Protection Fund to be redistributed to eligible volunteer fire companies or departments. Thereafter any monies that would otherwise have been distributed to the volunteer fire company or department under the provisions of section thirty-three, article three, and section seven, article twelve-c, all of chapter thirty-three of this code, shall be retained in the Fire Protection Fund and distributed to eligible volunteer fire companies or departments. A volunteer fire company or department subsequently complying with the provisions of this section is eligible to receive monies under the provisions of section thirty-four, article three, and section seven, article twelve-c, all of chapter thirty-three of this code, from the date of compliance forward, but may not recover monies previously redistributed or retained in the Fire Protection Fund pursuant to the provisions of this subsection (c).
(d) Whenever the State Auditor performs an audit of a volunteer fire company or department for any purpose, the Auditor shall also conduct an audit of other state funds received by the volunteer fire company or department pursuant to section thirty-four, article three, and section seven, article twelve-c, all of chapter thirty-three of this code. The State Auditor shall send a copy of the audit to the Legislative Auditor. The Legislative Auditor may accept an audit performed by the State Auditor in lieu of performing an audit under this section.
(e) If the Legislative Auditor is notified by a grantor, as defined in section fourteen, article four, chapter twelve of this code, that a volunteer fire company or department has failed to file a report or a sworn statement of expenditures for a state grant it received, the Legislative Auditor shall notify the State Treasurer, who shall withhold further distributions to the volunteer fire company or department in the same manner provided in subsection (c) of this section.
(f) Any report submitted pursuant to the provisions of this section may be filed electronically in accordance with the provisions of article one, chapter thirty-nine-a of this code.
(g) Any person who files a fraudulent sworn statement of expenditures or a fraudulent report pursuant to this section is guilty of a felony and, upon conviction thereof, shall be fined not less than $1,000.00 nor more than $5,000.00 or imprisoned in a state correctional facility for not less than one year nor more than five years, or both fined and imprisoned.
§8-15-8e. Eligibility for allocation from Volunteer Firefighters Length of Service Awards Program Fund.
(a) To be eligible to receive funds allocated from the Volunteer Firefighters Length of Service Awards Program Fund administered under section thirty-five, article three, chapter thirty-three of this code, each volunteer and part volunteer fire company and department shall meet the requirements listed in subdivisions (a) through (d) of section eight-a of this article, and be enrolled in a qualified length of service awards program.
(b) A length of service awards program is qualified for purposes of this section if approved by the State Fire Marshal. The State Fire Marshal shall approve a length of service awards program if:
(1) A volunteer or part volunteer fire company or department submits, or if the program is being provided to a group, the volunteer and part volunteer fire companies and departments participating in the group submit to the State Fire Marshal, in the manner and form prescribed by the State Fire Marshal, an application for approval of the program, together with such documents and other information relating to the program as the State Fire Marshal may determine to be necessary to perform the duties prescribed under this section and section thirty-five, article three, chapter thirty-three of this code;
(2) In consultation with the Insurance Commissioner and such others as the State Fire Marshal may deem necessary, the State Fire Marshal determines the provider of the program is licensed to provide the program under chapter thirty-three of this code; and
(3) The State Fire Marshal determines the program is in the best interests of the member beneficiaries of the program.
(c) The State Fire Marshal may refuse or revoke approval of a length of service awards program if the program or its provider is not in compliance with any applicable federal or state law.
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 any other provision of this code to the contrary, for members hired after the thirtieth day of June, two thousand nine, 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 established by section eighteen-a of this article on July 1, 2009, 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 may 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 established, effective July 1, 2009, 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 may be 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. Establishment 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 malfeasance or gross negligence.
(2) The board shall consist of seven members who 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 the enactment of this section during the 2009 regular legislative session, the Governor shall forthwith appoint the 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.
(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 July 1, 2009. 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.
(d) A majority of the full authorized 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 Municipal Pensions 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 proposed for promulgation as legislative rules by the board:
Provided, That the board shall award contracts on a competitive basis. The purchasing policies and procedures may initially 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 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 may initially 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 Government and Finance and the 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 October 31, 2012, the board shall report to the Joint Committee on Government and Finance and 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-e, article three, chapter thirty-three of this code. The duties and functions of the State Treasurer's office with respect to such monitoring as well as such distribution is transferred from the State Treasurer's office to the West Virginia Municipal Pensions Oversight Board effective July 1, 2009
: 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 July 1, 2009, 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 policemen's and firemen's pension and relief funds.
(b) There is hereby 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 section fourteen-e, 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 Commissioner, the State Treasurer 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 close the Municipal Pensions and Protection 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-e, 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 July 1, 2009, 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 July 1, 2009, each municipality shall, in accordance with subsection (f), section twenty-six-a of this article, 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 premium tax revenues as provided in section fourteen-e, 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 July 1, one thousand nine hundred eighty-three 2009, and subject to provisions of subsection (c), section eighteen-b of this article and section fourteen-e, 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 fourteen-e, 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 premium taxes authorized by section fourteen-e, 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-e, 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 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 with the actuary for the year 2009, but beginning no later than January 1, 2010. 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 June 30, one thousand nine hundred ninety-one 2009, 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-e, 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 June 30, 2049. For this purpose, the targeted funded ratio is defined as the projected market value of assets as of June 30, 2049, divided by the projected actuarial accrued liabilities as of June 30, 2049, 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 June 30, 2010, and including the plan year ending on June 30, 2049. 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 June 30 in years 2009 through 2013, 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 June 30, 2009, so that by the year ending on June 30, 2013, the municipality is making contributions at the rate required under this section. If the actuarial valuation on or after June 30, 2009, projects a contribution rate for years 2013 and beyond greater than forty-five percent, but less than sixty percent to reach the one hundred percent targeted funded ratio in 2049, the targeted funded ratio in year 2049 may be changed from one hundred percent to ninety percent. If the actuarial valuation on or after June 30, 2009, projects a contribution rate for years 2013 and beyond of sixty percent or more to reach the one hundred percent targeted funded ratio in 2049, the targeted funded ratio in 2049 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 June 30, 2009. 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 June 30, 2009, 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 June 30, 2010. The funded ratio as of June 30, 2009, 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 June 30, 2049, 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 2049 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-e, 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 2049, t
he 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 2009, but beginning no later than January 1, 2010, 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 Joint Committee on Government and Finance, 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 January 1, 2010, 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 by boards of trustees; exercise of judgment discretion 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 September 30, 2009, 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; disclosure of fees and costs.
(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 June 30, 1981, 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 September 1, 2009, 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 July 1, 2009, 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 January 1, 2010, 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 June 30, 1981, 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 twenty-six 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 such 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: (A) Such The member fails to be examined as provided in subsection (a) of this section of this article; or (B) 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 of this section to the contrary, 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 January 1, 1991, shall receive as an annualized monthly supplemental benefit commencing on each July 1 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 day 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 January 1, 1991, shall receive commencing each July 1, 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 day 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, if 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 eight to nine 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 July 1, 1985, the following provisions shall govern and control the amount of such the pension benefits:
(1) A former member who on June 30, 1962, 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 1, 1985, 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 1, 1962, shall continue to receive pension benefits, but on and after July 1, 1985, 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 July 1, 1985, 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 30, 1962, 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 1, 1985, 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 1, 1962, shall continue to receive death benefits, but on and after July 1, 1985, 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 July 1, 1985, shall continue to receive disability pension benefits provided for in section twenty-four of this article.
CHAPTER 11. TAXATION.

ARTICLE 21. PERSONAL INCOME TAX.
§11-21-12i. Additional modification reducing federal adjusted gross income for insurance policy premium surcharges.

(a) For taxable years beginning on and after January 1, 2009, in addition to amounts authorized to be subtracted from federal adjusted gross income pursuant to subsection (c), section twelve of this article, any payment made during the taxable year for insurance policy premium surcharges imposed for the purpose of providing additional revenue for volunteer fire departments and part-volunteer fire departments pursuant to sections thirty-four and and thirty-five, article three, chapter thirty-three of this code, is an authorized modification reducing federal adjusted gross income, but only to the extent the amount is not allowable as a deduction when arriving at the taxpayer's federal adjusted gross income for the taxable year in which the payment is made.
CHAPTER 12. PUBLIC MONEYS AND SECURITIES.

ARTICLE 4. ACCOUNTS, REPORTS AND GENERAL PROVISIONS.
§12-4-14. Accountability of persons receiving state funds or grants; criminal penalties.
(a) For the purposes of this section:
(1) "Grantor" means a state spending unit awarding a state grant.
(2) "Person" includes any corporation, partnership, association, individual or other legal entity. The term "person" does not include a state spending unit or a local government as defined in section one-a, article nine, chapter six of this code.
(3) "Report" means an engagement, such as an agreed-upon procedures engagement or other attestation engagement, performed and prepared by a certified public accountant to test whether state grants were spent as intended. The term "report" does not mean a full-scope audit or review of the person receiving state funds.
(4) "State grant" means funding provided by a state spending unit, regardless of the original source of the funds, to a person upon application for a specific purpose. The term "state grant" does not include: (A) Payments for goods and services purchased by a state spending unit; (B) compensation to state employees and public officials; (C) reimbursements to state employees and public officials for travel or incidental expenses; (D) grants of student aid; (E) government transfer payments; (F) direct benefits provided under state insurance and welfare programs; (G) funds reimbursed to a person for expenditures made for qualified purposes when receipts for the expenditures are required prior to receiving the funds: Provided, That notwithstanding the provisions of this subdivision, funding provided pursuant to section twelve, article two, chapter five-b is included within the term "state grant"; (H) retirement benefits; and (I) federal pass-through funds that are subject to the federal Single Audit Act Amendments of 1996, 31 U.S.C. 7501, et seq. The term "state grant" does not include formula distributions to volunteer and part-volunteer fire departments made pursuant to sections fourteen-d and thirty-three section thirty-four, article three, chapter thirty-three of this code and section seven, article twelve-c of said chapter.
(b)(1) Any person who receives one or more state grants in the amount of $50,000 or more in the aggregate in a state's fiscal year shall file with the grantor a report of the disbursement of the state grant funds. When the grantor causes an audit, by an independent certified public accountant, to be conducted of the grant funds, the audit is performed using generally accepted government auditing standards and a copy of the audit is available for public inspection, no report is required to be filed under this section. An audit performed that complies with Office of Management and Budget circular A-133, as published on the twenty-seventh day of June, two thousand three, and submitted within the period provided in this section may be substituted for the report.
(2) Any person who receives a state grant in an amount less than $50,000 or who is not required to file a report because an audit has been conducted or substituted as provided by subdivision (1) of this subsection shall file with the grantor a sworn statement of expenditures made under the grant.
(3) Reports and sworn statements of expenditures required by subdivisions (1) and (2) of this subsection shall be filed within two years of the end of the person's fiscal year in which the disbursement of state grant funds by the grantor was made. The report shall be made by an independent certified public accountant at the cost of the person receiving the state grant. State grant funds may be used to pay for the report if the applicable grant provisions allow. The scope of the report is limited to showing that the state grant funds were spent for the purposes intended when the grant was made.
(c)(1) Any person failing to file a required report or sworn statement of expenditures within the two-year period provided in subdivision (3), subsection (b) of this section for state grant funds disbursed after July 1, 2003, is barred from subsequently receiving state grants until the person has filed the report or sworn statement of expenditures and is otherwise in compliance with the provisions of this section.
(2) Any grantor of a state grant shall report any persons failing to file a required report or sworn statement of expenditures within the required period provided in subdivision (3), subsection (b) of this section for a state grant disbursed after July 1, 2003, to the Legislative Auditor for purposes of debarment from receiving state grants.
(d)(1) The state agency administering the state grant shall notify the grantee of the reporting requirements set forth in this section.
(2) All grantors awarding state grants shall, prior to awarding a state grant, take reasonable actions to verify that the person is not barred from receiving state grants pursuant to this section. The verification process shall, at a minimum, include:
(A) A requirement that the person seeking the state grant provide a sworn statement from an authorized representative that the person has filed all reports and sworn statements of expenditures for state grants received as required under this section; and
(B) Confirmation from the Legislative Auditor by the grantor that the person has not been identified as one who has failed to file a report or sworn statement of expenditures under this section. Confirmation may be accomplished by accessing the computerized database provided in subsection (e) of this section.
(3) If any report or sworn statement of expenditures submitted pursuant to the requirements of this section provides evidence of a reportable condition or violation, the grantor shall provide a copy of the report or sworn statement of expenditures to the Legislative Auditor within thirty days of receipt by the grantor.
(4) The grantor shall maintain copies of reports and sworn statements of expenditures required by this section and make the reports or sworn statements of expenditures available for public inspection, as well as for use in audits and performance reviews of the grantor.
(5) The Secretary of the Department of Administration has authority to promulgate procedural and interpretive rules and propose legislative rules for promulgation in accordance with the provisions of article three, chapter twenty-nine-a of this code to assist in implementing the provisions of subsections (a), (b), (c) and (d) of this section.
(e)(1) Any state agency administering a state grant shall, in the manner designated by the Legislative Auditor, notify the Legislative Auditor of the maximum amount of funds to be disbursed, the identity of the person authorized to receive the funds, the person's fiscal year and federal employer identification number and the purpose and nature of the state grant within thirty days of making the state grant or authorizing the disbursement of the funds, whichever is later. If the state grant was awarded prior to the first day of October, two thousand five, the grantor shall provide the information required by this section by the first day of December, two thousand five.
(2) The State Treasurer shall provide the Legislative Auditor the information concerning formula distributions to volunteer and part-volunteer fire departments, made pursuant to sections fourteen-d and thirty-three section thirty-four, article three, chapter thirty-three of this code and section seven, article twelve-c of said chapter, the Legislative Auditor requests and in the manner designated by the Legislative Auditor.
(3) The Legislative Auditor shall maintain a list identifying persons who have failed to file reports and sworn statements required by this section. The list may be in the form of a computerized database that may be accessed by state agencies over the Internet.
(f) An audit of state grant funds may be authorized at any time by the Joint Committee on Government and Finance to be conducted by the Legislative Auditor at no cost to the grantee.
(g) (1) Volunteer and part-volunteer fire departments receiving formula distributions pursuant to sections fourteen-d and thirty-three, article three, chapter thirty-three of this code and section seven, article twelve-c of said chapter shall either:
(A) File a report, as defined in subdivision (3), subsection (a) of this section with the Legislative Auditor within the same time frames as are required for sworn statements of annual expenditures to be filed under this section. The report shall be made by an independent certified public accountant at the cost of the volunteer or part-volunteer fire department. The scope of the report is limited to showing that the funds distributed were spent for authorized purposes; or
(B) File a sworn statement of annual expenditures with the Legislative Auditor on or before the fourteenth day of February of each year. The sworn statement of expenditures shall be signed by the chief or director of the volunteer fire department and shall be made under oath and acknowledged before a notary public.
(2) If the sworn statement or report required by this subsection is not filed on or before the fifteenth day of May, unless the time period is extended by the Legislative Auditor, the Legislative Auditor may conduct an audit of the volunteer or part-volunteer fire department.
(3) If the sworn statement of annual expenditures or report required by this subsection is not filed with the Legislative Auditor by the first day of July, unless the time period is extended by the Legislative Auditor, the Legislative Auditor shall notify the State Treasurer who shall withhold payment of any amount that would otherwise be distributed to the fire department under the provisions of sections fourteen-d and thirty-three, article three, chapter thirty-three of this code and section seven, article twelve-c of said chapter until the report is complete. Moneys withheld pursuant to this subdivision are to be deposited in the special revenue account created in the State Treasury in subdivision (4) of this subsection.
(4) The Legislative Auditor may assign an employee or employees to perform audits or reviews at the direction of the Legislative Auditor of the disbursement of state grant funds to volunteer fire departments. The volunteer fire department shall cooperate with the Legislative Auditor, the Legislative Auditor's employees and the State Auditor in performing their duties under this section. If the Legislative Auditor determines a volunteer fire department is not cooperating, the Legislative Auditor shall notify the State Treasurer who shall withhold payment of any amount that would otherwise be distributed to the fire department under the provisions of sections fourteen-d and thirty-three, article three, chapter thirty-three of this code and section seven, article twelve-c of said chapter until the Legislative Auditor informs the Treasurer that the fire department has cooperated as required by this section. The State Treasurer shall pay the amount withheld into a special revenue account hereby created in the State Treasury and designated the "Volunteer Fire Department Audit Account". If, after one year from payment of the amount withheld into the special revenue account, the Legislative Auditor informs the State Treasurer of continued noncooperation by the fire department, the State Treasurer shall pay the amount withheld to the fund from which it was distributed to be redistributed the following year pursuant to the applicable provisions of those sections.
(5) Whenever the State Auditor performs an audit of a volunteer fire department for any purpose the Auditor shall also conduct an audit of other state funds received by the fire department pursuant to sections fourteen-d and thirty-three, article three, chapter thirty-three of this code and section seven, article twelve-c of said chapter. The Auditor shall send a copy of the audit to the Legislative Auditor. The Legislative Auditor may accept an audit performed by the Auditor in lieu of performing an audit under this section.
(6) If the Legislative Auditor is notified by a grantor that a fire department has failed to file a report or a sworn statement of expenditures for a state grant it received, the Legislative Auditor shall notify the Treasurer who shall withhold further distributions to the fire department in the same manner provided in subdivision (3) of this subsection.
(h)(g) Any report submitted pursuant to the provisions of this section may be filed electronically in accordance with the provisions of article one, chapter thirty-nine-a of this code.
(i)(h) Any person who files a fraudulent sworn statement of expenditures under subsection (b) or (g) of this section, a fraudulent sworn statement under subsection (d) of this section or a fraudulent report under this section is guilty of a felony and, upon conviction thereof, shall be fined not less than $1,000 nor more than $5,000 or imprisoned in a state correctional facility for not less than one year nor more than five years, or both fined and imprisoned.
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 September 30, 2009.
ARTICLE 3. LICENSING, FEES AND TAXATION OF INSURERS.
§33-3-14d. Additional fire and casualty insurance premium tax; allocation of proceeds; effective date repealed July 1, 2009.

(a) 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.
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. The net proceeds of this tax after appropriation thereof by the Legislature is distributed in accordance with the provisions of this section.
(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.
(2) Before the first day of September of each calendar year, the state treasurer 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. 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 in any year the actuarial report required by section twenty, article twenty-two, chapter eight of this code indicates no actuarial deficiency in the municipal policemen's or firemen's pension and relief fund, no revenues may be allocated from the municipal pensions and protection fund to that fund. The revenues from the municipal pensions and protection fund shall then be allocated to all other pension funds which have an actuarial deficiency.
(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 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. 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, and sections eight-a and eight-b, article fifteen, chapter eight of this code.
(e) Each and every provision of this section is repealed beginning on and after July 1, 2009.
§33-3-14e. Additional fire and casualty insurance premium tax; allocation of proceeds; effective July 1, 2009.

(a)(1) For the purpose of providing additional revenue for municipal policemen's and firemen's pension and relief funds, there is hereby levied and imposed an additional premium tax equal to one and twenty one hundredths of 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 into a special account in the State Treasury, designated the Municipal Pensions Security Fund, subject to provisions of section eighteen-b, article twenty-two, chapter eight of this code. After the distribution for expenses pursuant to subsection (d), section eighteen-a, article twenty-two, chapter eight of this code, the net proceeds of this tax after appropriation thereof by the Legislature shall be distributed in accordance with the provisions of this section.
(b) Before August 1, 2009, 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. Beginning in 2010, before August 1 of each year, the report shall be made to the municipal pensions oversight board created in section eighteen-a, article twenty-two, chapter eight of this code, and the board shall provide a copy of the report annually to the State Treasurer by September 1.
(c)(1) Before September 1, 2009, the State Treasurer shall allocate and authorize for distribution the revenues in the municipal pensions and protection fund in an amount equal to the amount that was collected during the preceding calendar year, together with any interest or other earnings thereon, to municipal policemen's and firemen's pension and relief funds for the purposes set forth in this section.
(2) Before September 1, 2010, the municipal pensions oversight board shall allocate and authorize for distribution the revenues in Municipal Pensions Security Fund in an amount equal to total of the amount transferred to the Municipal Pensions Security Fund from the municipal pensions and protection fund on September 1, 2009 and the amount collected during from September through December, 2009, together with any interest or other earnings thereon, to municipal policemen's and firemen's pension and relief funds for the purposes set forth in this section, subject to provisions in section eighteen-b, article twenty-two, chapter eight of this code.
(3)(A) Beginning January 1, 2010, the Municipal Pensions Oversight Board shall annually invest thirty-seven and five tenths of one percent of collections of the additional premium tax with the West Virginia Investment Management Board or the Board of Treasury Investments. These amounts and any earnings thereon shall be segregated from the collections described in subsection (4) of this subsection and are not subject to administrative fees. No allocations or distributions may be made from these segregated assets before January 1, 2015.
(B) After December 31, 2014, the municipal pension oversight board shall in each calendar year distribute an amount equal to one-fifth of the value of these segregated assets, as determined as of January 1 of the calendar year, to the eligible municipal policemen's or firemen's pension and relief funds, subject to provisions in section eighteen-b, article twenty-two, chapter eight of this code for the purposes and upon the conditions set forth in this section.
(C) The annual allocations and distributions of the segregated assets shall be made only to qualifying municipalities, as defined in section two, article thirteen-c, chapter eight of this code, that have in effect on January 1 of the calendar year of distribution the imposition of a pension relief municipal occupational tax, a pension relief municipal sales and service tax, a pension relief municipal use tax or any other tax, or any combination of those taxes, the proceeds of which are dedicated solely for the purposes set forth in section nine, article thirteen-c, chapter eight of this code.
(D) Except as otherwise provided in this paragraph, annual allocations and distributions of the segregated assets shall be made on a pro rata basis 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. An allocation and distribution made under this subdivision shall also be used by the municipality solely for the purposes of section two, article thirteen-c, chapter eight of this code. The distributions shall be provided on a matching basis so that the amount of an allocation to a municipality may not exceed the amount of the revenues the municipality applies for those purposes from its collections of the tax or taxes imposed for those purposes.
(4)(A) Beginning in 2011, before September 1 of each year, the Municipal Pensions Oversight Board shall allocate and authorize for distribution a portion of the revenues in the Municipal Pensions Security Fund in an amount equal to sixty-two and five tenths of one percent, together with any interest or other earnings thereon, of the amount of the additional premium tax collected during the preceding calendar year to municipal policemen's and firemen's pension and relief funds for the purposes set forth in this section, subject to provisions in section eighteen-b, article twenty-two, chapter eight of this code.
(B) Allocations and distributions of the amounts described in this subdivision shall be made on a pro rata basis 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. 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.
(d) To be eligible to receive any 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.
(e) In any year the actuarial report required by section twenty, article twenty-two, chapter eight of this code indicates 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 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 July 1, 2009, 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 July 1, 2009. 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.
(f) Except where otherwise provided by this section, 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 municipalities' average number of members who worked at least one hundred hours per month and average monthly number of retired members. Except where otherwise provided by this section, 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.
(g) The allocation and distribution of revenues provided in this section are subject to the provisions of section twenty, article twenty-two, chapter eight of this code.
(h) The provisions of this section are effective beginning July 1, 2009, and thereafter.
§33-3-33. Surcharge on fire and casualty insurance policies to benefit volunteer and part-volunteer fire departments; Public Employees Insurance Agency and municipal pension plans; special fund created; allocation of proceeds; effective date repealed July 1, 2009.

(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) After the thirty-first day of December, two thousand five, 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) 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) 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) 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) Each and every provision of this section is repealed beginning on and after July 1, 2009.
§33-3-34. Surcharge on fire and casualty insurance policies to benefit volunteer and part-volunteer fire departments; allocation of proceeds; effective July 1, 2009.

(a)(1) 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 eighty one hundredths of one percent of the taxable premium for each such policy.
(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 March 1 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 $100 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 surcharge and the interest or other earnings 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. Each volunteer fire company or department shall receive an equal share of the revenues allocated for volunteer and part volunteer fire companies and departments.
(2) 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 (1) 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.
(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 from the Fire Protection Fund are subject to the provisions of sections eight-a and eight-b, article fifteen, chapter eight of this code.
(f) The provisions of this section are effective beginning July 1, 2009, and thereafter.
§33-3-35. Additional surcharge on fire and casualty insurance policies to Volunteer Firefighters Length of Service Awards Programs Fund benefits for members of volunteer and part volunteer fire companies and departments; special fund created; allocation of proceeds; duties of State Treasurer and State Fire Marshal.

(a)(1) For the purpose of providing additional revenue for volunteer and part volunteer fire companies and departments that provide benefits to their members under a qualified length of service awards program, there is hereby authorized and imposed on and after January 1, 2010, 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, an additional policy surcharge equal to thirty one hundredths of one percent of the taxable premium for each such policy.
(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.
(3) The surcharge imposed under this section is in addition to all other taxes, surcharges, licenses or other charges to which the persons charged herein are subject under the law of this state.
(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 March 1 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 $100 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) All money from the policy surcharge shall be collected by the commissioner, transferred into a special revenue fund to be administered by the State Treasurer, designated the "Volunteer Firefighters Length of Service Awards Program Fund," which is hereby created, and expended for the purposes provided in this section in accordance with subsection (e) of this section. Any earnings or other return on the investment of the moneys in the fund shall be deposited into the General Revenue Fund, but at the end of each fiscal year, the moneys deposited into the fund shall not revert to the General Revenue Fund but shall continue to be held in the fund for expenditure during the ensuing fiscal year, except as provided in subsection (e) of this section.
(e)(1) On and after January 1, 2011, and each year thereafter, the State Treasurer shall distribute an amount equal to the amount of money in the Volunteer Firefighters Length of Service Awards Program Fund that was collected and deposited into the fund during the next preceding calendar year as provided in this subsection.
(2) Not more than one-half of one percent of the total amount of collections during the next preceding calendar year, in an amount not to exceed $100,000 as certified by the State Fire Marshal as necessary to defray the annual expenses for the performance of the administrative duties imposed upon the State Fire Marshal by this section and section eight-e, article fifteen, chapter eight of this code, shall be transferred by the State Treasurer to the Fire Marshal Fees Fund established in section twelve-b, article three, chapter twenty-nine of this code.
(3) Not more than one-half of one percent of the total amount of collections during the next preceding calendar year, in an amount not to exceed $100,000 as certified by the State Treasurer as necessary to defray the annual expenses for the performance of the administrative duties imposed upon the State Treasurer by this section, shall be transferred to an account designated by the State Treasurer.
(4) From the net amount collected and deposited into the fund during the next preceding calendar year as provided in this subsection, the State Treasurer shall distribute a share, as determined in subdivisions (5) and (6) of this subsection, to each eligible volunteer and part volunteer fire company and department that provides benefits to their members under a qualified length of service awards program for purposes of defraying the annual expense of the premium costs incurred by the volunteer or part volunteer fire company or department to participate in the program.
(5) Before each distribution, 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-e, article fifteen, chapter eight of this code, and separately identify the names and addresses of those that are enrolled in a qualified length of service awards program and the payment or portion of payment due or that will become due from each of those volunteer and part volunteer fire companies and departments during the current year to continue coverage under the program.
(6) The share distributed to each qualified volunteer and part volunteer fire company and department shall be the lesser of the amount of the payment or portion of payment due or that will become due during the current year from the volunteer or part volunteer fire company or department to continue coverage under the program, or an amount equal to the net amount collected and deposited into the fund during the next preceding calendar year as described in subdivision (1) of this subsection divided by the total number of volunteer and part volunteer fire companies and departments within the state reported by the State Fire Marshal under subdivision (5) of this subsection.
(7) Within thirty days following the expiration of the calendar year, the State Treasurer shall transfer any amount undistributed and remaining of the moneys to be distributed under subdivision (6) of this subsection to the Fire Protection Fund administered pursuant to section thirty-four of this article and expended for the purposes provided by that section.
(f) Funds received by volunteer and part volunteer fire companies and departments pursuant to this section shall be used solely for the cost of providing a length of service awards program for their members. Any volunteer or part volunteer fire company or department that fails to expend those funds for those purposes shall repay the amount of the funds to the State Treasurer within one year of receipt. The State Treasurer shall deposit all repaid amounts into the Fire Protection Fund administered pursuant to section thirty-four of this article.
(g) The allocation, distribution and use of revenues provided in the Volunteer Firefighters Length of Service Awards Program Fund are subject to sections eight-b and eight-e, article fifteen, chapter eight of this code.

Note: The purpose of this bill is to modify statutory provisions through which the state provides assistance to certain political subdivision activities involving municipal policemen's and firemen's pensions and relief systems and volunteer fire departments.

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

§8-15-8d, §8-15-8e, §8-22-18a, §8-22-18b, §11-21-12i, §33-2- 15e, §33-3-14e, §33-3-34 and §33-3-35 are new.
This Web site is maintained by the West Virginia Legislature's Office of Reference & Information.  |  Terms of Use  |   Email WebmasterWebmaster   |   © 2024 West Virginia Legislature **


X

Print On Demand

Name:
Email:
Phone:

Print