H.B. 83 Enrolled

STATE RETIREMENT - FUNDED RATIO
2004 GENERAL SESSION
STATE OF UTAH
Sponsor: Ann W. Hardy

LONG TITLE
General Description:
This bill modifies the Utah State Retirement and Insurance Benefit Act by authorizing
the maximum actuarial funded ratio of the retirement systems to reach 110%.
Highlighted Provisions:
This bill:
. authorizes the actuarial funded ratio of the retirement systems to reach and be
maintained at 110%; and
. prohibits contribution rate increases to attain an actuarial funded ratio greater than
100%.
Monies Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
49-11-301, as renumbered and amended by Chapter 250, Laws of Utah 2002

Be it enacted by the Legislature of the state of Utah:
Section 1. Section 49-11-301 is amended to read:
49-11-301. Creation -- Board to act as trustees of the fund -- Commingling and
pooling of funds -- Interest earnings -- Funded ratio.
(1) There is created a common trust fund known as the "Utah State Retirement
Investment Fund" for the purpose of enlarging the investment base and simplifying investment

procedures and functions.
(2) (a) The board shall act as trustees of the Utah State Retirement Investment Fund and,
through the executive director, may commingle and pool the funds and investments of any system,
plan, or program into the Utah State Retirement Investment Fund, if the principal amounts of the
participating funds do not lose their individual identity and are maintained as separate trust funds
on the books of the office.
(b) (i) In combining the investments of any fund, each of the participating funds shall be
credited initially with its share of the total assets transferred to the Utah State Retirement
Investment Fund.
(ii) The value of the transferred assets shall be calculated in accordance with generally
accepted accounting principles.
(c) Subsequent transfers of additional capital from participating funds shall be credited
similarly to its respective trust account.
(d) The income or principal or equity credit belonging to one participating fund may not
be transferred to another, except for the purpose of:
(i) actuarially recommended transfers in order to adjust employer contribution rates for an
employer that participates in both contributory and noncontributory systems; or
(ii) transfers which reflect the value of service credit accrued in different systems during a
member's career.
(3) The assets of the funds are for the exclusive benefit of the members, participants, and
covered individuals and may not be diverted or appropriated for any purpose other than that
permitted by this title.
(4) (a) Interest and other earnings shall be credited to each participating fund on a pro
rata equity position basis.
(b) (i) A portion of the interest and other earnings of the common trust fund may be
credited to a reserve account within the Utah State Retirement Investment Fund to meet adverse
experiences arising from investments or other contingencies.
(ii) Each participating fund shall retain its proportionate equity in the reserve account.

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(5) (a) The actuarial funded ratio of the systems may reach and be maintained at 110%, as
determined by the board's actuary using assumptions adopted by the board, before the board is
required to certify a decrease in contribution rates.
(b) The board may not increase contribution rates to attain an actuarial funded ratio
greater than 100%.

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