H.B. 107 Enrolled

1

VOLUNTEER FIREFIGHTERS' RETIREMENT AMENDMENTS
2 2011 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Ronda Rudd Menlove
5 Senate Sponsor: Daniel R. Liljenquist
6
7 LONG TITLE
8 General Description:
9 This bill amends the allocation of premium tax revenues to fund volunteer firefighters'
10 long-term disability program.
11 Highlighted Provisions:
12 This bill:
13 . requires the Retirement Office to fund the long-term disability benefits for new
14 firefighters using certain premium tax revenues previously deposited into the
15 Firefighters' Retirement Trust Fund; and
16 . makes technical amendments.
17 Money Appropriated in this Bill:
18 None
19 Other Special Clauses:
20 None
21 Utah Code Sections Affected:
22 AMENDS:
23 49-11-902, as last amended by Laws of Utah 2008, Chapter 227
24 49-16-301, as last amended by Laws of Utah 2004, Chapter 262
25 49-23-601, as enacted by Laws of Utah 2010, Chapter 266
26 ENACTS:
27 49-11-901.5, Utah Code Annotated 1953
28
29 Be it enacted by the Legislature of the state of Utah:

30 Section 1. Section 49-11-901.5 is enacted to read:
31 49-11-901.5. Premium tax revenues -- Distribution.
32 (1) (a) In accordance with this section there shall be paid to the office:
33 (i) 50% of the annual tax levied, assessed, and collected under Title 59, Chapter 9,
34 Taxation of Admitted Insurers, upon premiums for property insurance, as defined under
35 Section 31A-1-301 , and as applied to fire and allied lines insurance collected by insurance
36 companies within the state; and
37 (ii) 10% of all money assessed and collected under Title 59, Chapter 9, Taxation of
38 Admitted Insurers, upon premiums for life insurance, as defined in Section 31A-1-301 , within
39 the state.
40 (b) Payments to the fund shall be made annually until the service liability under this
41 part is liquidated, after which the tax revenue provided in this Subsection (1) ceases.
42 (2) The office shall distribute the premium tax revenue paid under Subsection (1) as
43 follows:
44 (a) an amount determined by the office to fully fund the long-term disability program
45 provided for firefighters under Section 49-23-601 ;
46 (b) an amount determined by the office to the Firefighters' Retirement Trust Fund
47 created under Section 49-16-104 equal to an amount when calculated as a percentage of the
48 certified contribution rate for members in Division A and B, as defined under Section
49 49-16-301 , is the percentage of the certified contribution rate paid to the Firefighters'
50 Retirement Trust Fund on July 1, 2004; and
51 (c) any remaining amount in accordance with Section 49-11-902 .
52 Section 2. Section 49-11-902 is amended to read:
53 49-11-902. Premium tax revenues -- Formula -- Deposits.
54 (1) [(a)] If the premium tax revenue received by the office under Subsection
55 [ 49-16-301 (6), when calculated as a percentage of the certified contribution rate for members
56 in Division A and B, as defined under Section 49-16-301 , exceeds the percentage of the
57 certified contribution rate paid to the Firefighters' Retirement Trust Fund in accordance with

58 Subsection 49-16-301 (6) on July 1, 2004,] 49-11-901.5 (1) and first paid in accordance with
59 Subsections 49-11-901.5 (2)(a) and (b), including any remaining amount, the office shall
60 deposit the [difference] amount in the:
61 (a) Public Safety Contributory Trust Fund created under Section 49-14-104 ; and [the]
62 (b) Public Safety Noncontributory Retirement Trust Fund created under Section
63 49-15-104 .
64 [(b) If the premium tax revenue does not exceed the percentage of the certified
65 contribution rate paid to the Firefighters' Retirement Trust Fund in accordance with Subsection
66 49-16-301 (6) on July 1, 2004 as calculated under Subsection (1)(a), the board may not make a
67 deposit under Subsection (1)(a).]
68 (2) The money deposited under this section shall be used to fund an increase for
69 retirees in the public safety retirement systems from a 2.5% maximum annual cost-of-living
70 adjustment to a 4% maximum annual cost-of-living adjustment under Sections 49-14-403 and
71 49-15-403 in the public safety retirement systems.
72 (3) As required to implement this section, the office shall make the calculations and
73 deposits for the equitable apportionment of money between:
74 (a) Division A1 and B1; and
75 (b) the contributory and noncontributory trust funds.
76 Section 3. Section 49-16-301 is amended to read:
77 49-16-301. Contributions -- Two divisions -- Election by employer to pay
78 employee contributions -- Accounting for and vesting of worker contributions --
79 Deductions.
80 (1) In addition to the money paid to this system under [Subsection (6)] Section
81 49-11-901.5 , participating employers and firefighter service employees shall jointly pay the
82 certified contribution rates to the office to maintain this system on a financially and actuarially
83 sound basis.
84 (2) For purposes of determining contribution rates, this system is divided into two
85 divisions according to Social Security coverage as follows:

86 (a) members of this system with on-the-job Social Security coverage are in Division A;
87 and
88 (b) members of this system without on-the-job Social Security coverage are in Division
89 B.
90 (3) (a) A participating employer may elect to pay all or part of the required member
91 contributions, in addition to the required participating employer contributions.
92 (b) Any amount contributed by a participating employer under this section shall vest to
93 the member's benefit as though the member had made the contribution.
94 (c) The required member contributions shall be reduced by the amount that is paid by
95 the participating employer.
96 (4) (a) All member contributions are credited by the office to the account of the
97 individual member.
98 (b) This amount is held in trust for the payment of benefits to the member or the
99 member's beneficiaries.
100 (c) All member contributions are vested and nonforfeitable.
101 (5) (a) Each member is considered to consent to payroll deductions of member
102 contributions.
103 (b) The payment of compensation less these payroll deductions is considered to be full
104 payment for services rendered by the member.
105 [(6) (a) Except as provided in Section 49-11-902 , in addition to contribution rates
106 described under this section, there shall be paid to the Firefighters' Retirement Trust Fund
107 created under Section 49-16-104 :]
108 [(i) 50% of the annual tax levied, assessed, and collected under Title 59, Chapter 9,
109 Taxation of Admitted Insurers, upon premiums for property insurance, as defined under
110 Section 31A-1-301 , and as applied to fire and allied lines insurance collected by insurance
111 companies within the state; and]
112 [(ii) 10% of all money assessed and collected under Title 59, Chapter 9, Taxation of
113 Admitted Insurers, upon premiums for life insurance, as defined in Section 31A-1-301 , within

114 the state.]
115 [(b) Payments to the fund shall be made annually until the service liability is
116 liquidated, after which the tax revenue provided in this Subsection (6) for the Firefighters'
117 Retirement Trust Fund ceases.]
118 Section 4. Section 49-23-601 is amended to read:
119 49-23-601. Long-term disability coverage.
120 [Each] (1) A participating employer shall cover [the following employees] a public
121 safety employee who initially enters employment on or after July 1, 2011, under Title 49,
122 Chapter 21, Public Employees' Long-Term Disability Act, or a substantially similar long-term
123 disability program[:],
124 [(1) public safety employees initially entering employment on or after July 1, 2011;]
125 [(2) firefighter service employees initially entering employment on or after July 1,
126 2011; and]
127 [(3) volunteer firefighters.]
128 (2) (a) A participating employer shall cover a firefighter employee who initially enters
129 employment on or after July 1, 2011, under Title 49, Chapter 21, Public Employees'
130 Long-Term Disability Act.
131 (b) In accordance with this section, a participating employer shall provide long term
132 disability benefit coverage for a volunteer firefighter as provided under Section 49-16-701 .
133 (c) The office shall ensure that the cost of the long-term disability benefit coverage
134 provided under Subsection (2)(a) and (b) is funded with revenue received under Section
135 49-11-901.5 .