S.B. 269
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7 LONG TITLE
8 General Description:
9 This bill modifies the Utah State Personnel Management Act by amending provisions
10 for employee leave programs and creates the State Employees' Annual Leave Program
11 II Trust Fund Act.
12 Highlighted Provisions:
13 This bill:
14 . defines "annual leave II";
15 . provides that beginning January 3, 2015, a state agency will offer annual leave II in
16 lieu of annual leave to eligible state employees;
17 . provides that any unused annual leave accrued before January 3, 2015, may be used
18 under the same rules that applied to the leave on January 1, 2014;
19 . requires a state agency to set aside the cost of each hour of annual leave II for each
20 eligible employee for deposit into the State Employees' Annual Leave Program II
21 Trust Fund;
22 . provides for rulemaking authority; and
23 . enacts the State Employees' Annual Leave Program II Trust Fund Act, which creates
24 the State Employees' Annual Leave Program II Trust Fund and board and provides
25 for administration of the trust fund.
26 Money Appropriated in this Bill:
27 None
28 Other Special Clauses:
29 None
30 Utah Code Sections Affected:
31 ENACTS:
32 67-19-14.6 , Utah Code Annotated 1953
33 67-19f-101 , Utah Code Annotated 1953
34 67-19f-102 , Utah Code Annotated 1953
35 67-19f-201 , Utah Code Annotated 1953
36 67-19f-202 , Utah Code Annotated 1953
37 67-19f-301 , Utah Code Annotated 1953
38 67-19f-302 , Utah Code Annotated 1953
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40 Be it enacted by the Legislature of the state of Utah:
41 Section 1. Section 67-19-14.6 is enacted to read:
42 67-19-14.6. Annual leave -- Definition -- Previously accrued hours -- Recognition
43 of liability.
44 (1) (a) As used in this section, "annual leave II" means leave hours an employing
45 agency provides to an employee, beginning January 3, 2015, as time off from work for personal
46 use without affecting the employee's pay.
47 (b) "Annual leave II" does not include:
48 (i) legal holidays under Section 63G-1-301 ;
49 (ii) time off as compensation for actual time worked in excess of an employee's defined
50 work period;
51 (iii) sick leave;
52 (iv) paid or unpaid administrative leave; or
53 (v) other paid or unpaid leave from work provided by:
54 (A) state statute or administrative rule; or
55 (B) federal law or regulation.
56 (2) Beginning on January 3, 2015, a state agency shall offer annual leave II in lieu of
57 annual leave to an employee who is eligible to receive paid leave.
58 (3) An employing agency shall allow an employee who has an unused balance of
59 accrued annual leave before January 3, 2015, to use the annual leave under the same rules that
60 applied to the leave on January 1, 2014.
61 (4) (a) At the time of employee accrual of annual leave II, an employing agency shall
62 set aside the cost of each hour of annual leave II for each eligible employee in an amount
63 determined in accordance with rules made by the Division of Finance.
64 (b) The rules made under Subsection (4)(a) shall consider:
65 (i) the employee hourly rate of pay;
66 (ii) applicable employer paid taxes that would be required if the employee was paid for
67 the annual leave II instead of using it for time off;
68 (iii) other applicable employer paid benefits; and
69 (iv) adjustments due to employee hourly rate changes, including the effect on accrued
70 annual leave II balances.
71 (5) The cost set aside under Subsection (4) shall be deposited by the Division of
72 Finance into the State Employees' Annual Leave Program II Trust Fund created in Section
73 67-19f-201 .
74 (6) For annual leave hours accrued before January 3, 2015, an employing agency shall
75 continue to comply with the Division of Finance requirements for contributions to the
76 termination pool.
77 (7) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act:
78 (a) the department shall make rules for the accrual and use of annual leave II provided
79 under this section; and
80 (b) the Division of Finance shall make rules for the set aside provisions under
81 Subsections (4) and (5).
82 Section 2. Section 67-19f-101 is enacted to read:
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84 67-19f-101. Title.
85 This chapter is known as the "State Employees' Annual Leave Program II Trust Fund
86 Act."
87 Section 3. Section 67-19f-102 is enacted to read:
88 67-19f-102. Definitions.
89 As used in this chapter:
90 (1) "Annual leave II" is as defined in Section 67-19-14.6 .
91 (2) "Board of trustees" or "board" means the board of trustees created in Section
92 67-19f-202 .
93 (3) "Income" means the revenues received by the state treasurer from investments of
94 the trust fund principal.
95 (4) "Trust fund" means the State Employees' Annual Leave Program II Trust Fund
96 created in Section 67-19f-201 .
97 Section 4. Section 67-19f-201 is enacted to read:
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99 67-19f-201. Trust fund -- Creation -- Oversight -- Dissolution.
100 (1) There is created a trust fund entitled the "State Employees' Annual Leave Program
101 II Trust Fund."
102 (2) The trust fund consists of:
103 (a) ongoing revenue provided from a state agency set aside for accrued annual leave II
104 required under Section 67-19-14.6 ;
105 (b) appropriations made to the trust fund by the Legislature, if any;
106 (c) income; and
107 (d) revenue received from other sources.
108 (3) The Division of Finance shall account for the receipt and expenditures of trust fund
109 money.
110 (4) (a) The state treasurer shall invest trust fund money by following the procedures
111 and requirements of Part 3, Investment of Trust Funds.
112 (b) (i) The trust fund shall earn interest.
113 (ii) The state treasurer shall deposit all interest or other income earned from investment
114 of the trust fund back into the trust fund.
115 (5) The board of trustees created in Section 67-19f-202 may expend money from the
116 trust fund for:
117 (a) reimbursement to the employer of the costs paid to the trust fund in accordance
118 with Section 67-19-14.6 as annual leave II is used by an employee; and
119 (b) reasonable administrative costs that the board of trustees incurs in performing its
120 duties as trustee of the trust fund.
121 (6) The board of trustees shall ensure that:
122 (a) money deposited into the trust fund is expended only for the costs of annual leave
123 II, including any allotted benefits under Subsection 67-19-14.6 (4); and
124 (b) assets of the trust fund are dedicated to providing annual leave II established by
125 statute and rule.
126 Section 5. Section 67-19f-202 is enacted to read:
127 67-19f-202. Board of trustees of the State Employees' Annual Leave Program II
128 Trust Fund.
129 (1) (a) There is created a board of trustees of the State Employees' Annual Leave
130 Program II Trust Fund composed of the following three members:
131 (i) the state treasurer or the state treasurer's designee;
132 (ii) the director of the Division of Finance or the director's designee; and
133 (iii) the executive director of the Governor's Office of Management and Budget or the
134 executive director's designee.
135 (b) The state treasurer is chair of the board.
136 (c) Three members of the board is a quorum.
137 (d) A member may not receive compensation or benefits for the member's service, but
138 may receive per diem and travel expenses as allowed in:
139 (i) Section 63A-3-106 ;
140 (ii) Section 63A-3-107 ; and
141 (iii) rules made by the Division of Finance according to Sections 63A-3-106 and
142 63A-3-107 .
143 (e) (i) Except as provided in Subsection (1)(e)(ii), the state treasurer shall staff the
144 board of trustees.
145 (ii) The Division of Finance shall provide accounting services for the trust fund.
146 (2) The board shall:
147 (a) on behalf of the state, act as trustee of the trust fund created under Section
148 67-19f-201 and exercise the state's fiduciary responsibilities;
149 (b) meet at least twice per year;
150 (c) review and approve the policies, projections, rules, criteria, procedures, forms,
151 standards, performance goals, and actuarial reports for the trust fund;
152 (d) review and approve the budget for the trust fund;
153 (e) review financial records for the trust fund, including trust fund receipts,
154 expenditures, and investments; and
155 (f) do any other things necessary to perform the state's fiduciary obligations under the
156 trust fund.
157 (3) The board may:
158 (a) commission and obtain actuarial studies of the liabilities for the trust fund; and
159 (b) for purposes of the trust fund, establish labor additive rates to charge for the
160 administrative expenses of the trust fund.
161 (4) The attorney general shall:
162 (a) act as legal counsel and provide legal representation to the board of trustees; and
163 (b) attend, or direct an attorney from the Office of the Attorney General to attend, each
164 meeting of the board of trustees.
165 Section 6. Section 67-19f-301 is enacted to read:
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167 67-19f-301. Investment of State Employees' Annual Leave Program II Trust
168 Fund.
169 (1) The state treasurer shall invest the assets of the trust fund with the primary goal of
170 providing for the stability, income, and growth of the principal.
171 (2) Nothing in this section requires a specific outcome in investing.
172 (3) The state treasurer may deduct any administrative costs incurred in managing trust
173 fund assets from earnings before distributing the trust fund assets.
174 (4) (a) The state treasurer may employ professional asset managers to assist in the
175 investment of assets of the trust fund.
176 (b) The treasurer may only provide compensation to asset managers from earnings
177 generated by the trust fund's investments.
178 Section 7. Section 67-19f-302 is enacted to read:
179 67-19f-302. State treasurer to follow "prudent investor" rule -- Standard of care.
180 (1) The state treasurer shall invest and manage the trust fund assets as a prudent
181 investor would, by:
182 (a) considering the purposes, terms, distribution requirements, and other circumstances
183 of the trust fund; and
184 (b) exercising reasonable care, skill, and caution in order to meet the standard of care
185 of a prudent investor.
186 (2) In determining whether the state treasurer has met the standard of care of a prudent
187 investor, the judge or finder of fact shall:
188 (a) consider the state treasurer's actions in light of the facts and circumstances existing
189 at the time of the investment decision or action, and not by hindsight; and
190 (b) evaluate the state treasurer's investment and management decisions respecting
191 individual assets:
192 (i) not in isolation, but in the context of the trust fund portfolio as a whole; and
193 (ii) as a part of an overall investment strategy that has risk and return objectives
194 reasonably suited to the trust fund.
Legislative Review Note
as of 3-3-14 2:16 PM