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H.B. 430

             1     

CLASSIFIED SCHOOL EMPLOYEE AMENDMENTS

             2     
2012 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Bradley G. Last

             5     
Senate Sponsor: Casey O. Anderson

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill modifies the Utah State Retirement and Benefit Insurance Act by amending
             10      provisions relating to classified school employees.
             11      Highlighted Provisions:
             12          This bill:
             13          .    provides that, for purposes of determining retirement benefits provided under the
             14      Utah State Retirement and Benefit Insurance Act, a regular full-time employee does
             15      not include a classified school employee:
             16              .    who is hired on or after July 1, 2012, and does not receive benefits normally
             17      provided by the participating employer; or
             18              .    who is hired before July 1, 2012, who does not receive benefits normally
             19      provided by the participating employer, and whose employment hours are
             20      increased on or after July 1, 2012; and
             21          .    makes technical changes.
             22      Money Appropriated in this Bill:
             23          None
             24      Other Special Clauses:
             25          None
             26      Utah Code Sections Affected:
             27      AMENDS:


             28          49-12-102, as last amended by Laws of Utah 2008, Chapter 318
             29          49-13-102, as last amended by Laws of Utah 2008, Chapter 318
             30          49-22-102, as last amended by Laws of Utah 2011, Chapter 439
             31     
             32      Be it enacted by the Legislature of the state of Utah:
             33          Section 1. Section 49-12-102 is amended to read:
             34           49-12-102. Definitions.
             35          As used in this chapter:
             36          (1) (a) Except as provided in Subsection (1)(c), "compensation" means the total
             37      amount of payments made by a participating employer to a member of this system for services
             38      rendered to the participating employer, including:
             39          (i) bonuses;
             40          (ii) cost-of-living adjustments;
             41          (iii) other payments currently includable in gross income and that are subject to Social
             42      Security deductions, including any payments in excess of the maximum amount subject to
             43      deduction under Social Security law;
             44          (iv) amounts that the member authorizes to be deducted or reduced for salary deferral
             45      or other benefits authorized by federal law; and
             46          (v) member contributions.
             47          (b) "Compensation" for purposes of this chapter may not exceed the amount allowed
             48      under Internal Revenue Code, Section 401(a)(17).
             49          (c) "Compensation" does not include:
             50          (i) the monetary value of remuneration paid in kind, including a residence or use of
             51      equipment;
             52          (ii) the cost of any employment benefits paid for by the participating employer;
             53          (iii) compensation paid to a temporary employee, an exempt employee, or an employee
             54      otherwise ineligible for service credit;
             55          (iv) any payments upon termination, including accumulated vacation, sick leave
             56      payments, severance payments, compensatory time payments, or any other special payments; or
             57          (v) any allowances or payments to a member for costs or expenses paid by the
             58      participating employer, including automobile costs, uniform costs, travel costs, tuition costs,


             59      housing costs, insurance costs, equipment costs, and dependent care costs.
             60          (d) The executive director may determine if a payment not listed under this Subsection
             61      (1) falls within the definition of compensation.
             62          (2) "Final average salary" means the amount computed by averaging the highest five
             63      years of annual compensation preceding retirement subject to Subsections (2)(a), (b), (c), and
             64      (d).
             65          (a) Except as provided in Subsection (2)(b), the percentage increase in annual
             66      compensation in any one of the years used may not exceed the previous year's compensation by
             67      more than 10% plus a cost-of-living adjustment equal to the decrease in the purchasing power
             68      of the dollar during the previous year, as measured by a United States Bureau of Labor
             69      Statistics Consumer Price Index average as determined by the board.
             70          (b) In cases where the participating employer provides acceptable documentation to the
             71      office, the limitation in Subsection (2)(a) may be exceeded if:
             72          (i) the member has transferred from another agency; or
             73          (ii) the member has been promoted to a new position.
             74          (c) If the member retires more than six months from the date of termination of
             75      employment, the member is considered to have been in service at the member's last rate of pay
             76      from the date of the termination of employment to the effective date of retirement for purposes
             77      of computing the member's final average salary only.
             78          (d) If the member has less than five years of service credit in this system, final average
             79      salary means the average annual compensation paid to the member during the full period of
             80      service credit.
             81          (3) "Participating employer" means an employer which meets the participation
             82      requirements of Sections 49-12-201 and 49-12-202 .
             83          (4) (a) "Regular full-time employee" means an employee whose term of employment
             84      for a participating employer contemplates continued employment during a fiscal or calendar
             85      year and whose employment normally requires an average of 20 hours or more per week,
             86      except as modified by the board, and who receives benefits normally provided by the
             87      participating employer.
             88          (b) "Regular full-time employee" includes:
             89          (i) a teacher whose term of employment for a participating employer contemplates


             90      continued employment during a school year and who teaches half-time or more;
             91          (ii) a classified school employee:
             92          (A) who is hired before July 1, 2012; and
             93          (B) whose employment normally requires an average of 20 hours per week or more for
             94      a participating employer, regardless of benefits provided;
             95          (iii) an officer, elective or appointive, who earns during the first full month of the term
             96      of office $500 or more, indexed as of January 1, 1990, as provided in Section 49-12-407 ;
             97          (iv) a faculty member or employee of an institution of higher education who is
             98      considered full-time by that institution of higher education; and
             99          (v) an individual who otherwise meets the definition of this Subsection (4) who
             100      performs services for a participating employer through a professional employer organization or
             101      similar arrangement.
             102          (c) "Regular full-time employee" does not include a classified school employee:
             103          (i) (A) who is hired on or after July 1, 2012; and
             104          (B) who does not receive benefits normally provided by the participating employer
             105      even if the employment normally requires an average of 20 hours per week or more for a
             106      participating employer; or
             107          (ii) (A) who is hired before July 1, 2012;
             108          (B) who does not receive benefits normally provided by the participating employer;
             109      and
             110          (C) whose employment hours are increased on or after July 1, 2012, to require an
             111      average of 20 hours per week or more for a participating employer.
             112          (5) "System" means the Public Employees' Contributory Retirement System created
             113      under this chapter.
             114          (6) "Years of service credit" means:
             115          (a) a period, consisting of 12 full months as determined by the board;
             116          (b) a period determined by the board, whether consecutive or not, during which a
             117      regular full-time employee performed services for a participating employer, including any time
             118      the regular full-time employee was absent on a paid leave of absence granted by a participating
             119      employer or was absent in the service of the United States government on military duty as
             120      provided by this chapter; or


             121          (c) the regular school year consisting of not less than eight months of full-time service
             122      for a regular full-time employee of an educational institution.
             123          Section 2. Section 49-13-102 is amended to read:
             124           49-13-102. Definitions.
             125          As used in this chapter:
             126          (1) (a) Except as provided in Subsection (1)(c), "compensation" means the total
             127      amount of payments made by a participating employer to a member of this system for services
             128      rendered to the participating employer, including:
             129          (i) bonuses;
             130          (ii) cost-of-living adjustments;
             131          (iii) other payments currently includable in gross income and that are subject to Social
             132      Security deductions, including any payments in excess of the maximum amount subject to
             133      deduction under Social Security law; and
             134          (iv) amounts that the member authorizes to be deducted or reduced for salary deferral
             135      or other benefits authorized by federal law.
             136          (b) "Compensation" for purposes of this chapter may not exceed the amount allowed
             137      under Internal Revenue Code, Section 401(a)(17).
             138          (c) "Compensation" does not include:
             139          (i) the monetary value of remuneration paid in kind, including a residence or use of
             140      equipment;
             141          (ii) the cost of any employment benefits paid for by the participating employer;
             142          (iii) compensation paid to a temporary employee, an exempt employee, or an employee
             143      otherwise ineligible for service credit;
             144          (iv) any payments upon termination, including accumulated vacation, sick leave
             145      payments, severance payments, compensatory time payments, or any other special payments; or
             146          (v) any allowances or payments to a member for costs or expenses paid by the
             147      participating employer, including automobile costs, uniform costs, travel costs, tuition costs,
             148      housing costs, insurance costs, equipment costs, and dependent care costs.
             149          (d) The executive director may determine if a payment not listed under this Subsection
             150      (1) falls within the definition of compensation.
             151          (2) "Final average salary" means the amount computed by averaging the highest three


             152      years of annual compensation preceding retirement subject to the following:
             153          (a) Except as provided in Subsection (2)(b), the percentage increase in annual
             154      compensation in any one of the years used may not exceed the previous year's compensation by
             155      more than 10% plus a cost-of-living adjustment equal to the decrease in the purchasing power
             156      of the dollar during the previous year, as measured by a United States Bureau of Labor
             157      Statistics Consumer Price Index average as determined by the board.
             158          (b) In cases where the participating employer provides acceptable documentation to the
             159      office, the limitation in Subsection (2)(a) may be exceeded if:
             160          (i) the member has transferred from another agency; or
             161          (ii) the member has been promoted to a new position.
             162          (c) If the member retires more than six months from the date of termination of
             163      employment and for purposes of computing the member's final average salary only, the
             164      member is considered to have been in service at his last rate of pay from the date of the
             165      termination of employment to the effective date of retirement.
             166          (3) "Participating employer" means an employer which meets the participation
             167      requirements of Sections 49-13-201 and 49-13-202 .
             168          (4) (a) "Regular full-time employee" means an employee whose term of employment
             169      for a participating employer contemplates continued employment during a fiscal or calendar
             170      year and whose employment normally requires an average of 20 hours or more per week,
             171      except as modified by the board, and who receives benefits normally provided by the
             172      participating employer.
             173          (b) "Regular full-time employee" includes:
             174          (i) a teacher whose term of employment for a participating employer contemplates
             175      continued employment during a school year and who teaches half-time or more;
             176          (ii) a classified school employee:
             177          (A) who is hired before July 1, 2012; and
             178          (B) whose employment normally requires an average of 20 hours per week or more for
             179      a participating employer, regardless of benefits provided;
             180          (iii) an officer, elective or appointive, who earns during the first full month of the term
             181      of office $500 or more, indexed as of January 1, 1990, as provided in Section 49-13-407 ;
             182          (iv) a faculty member or employee of an institution of higher education who is


             183      considered full-time by that institution of higher education; and
             184          (v) an individual who otherwise meets the definition of this Subsection (4) who
             185      performs services for a participating employer through a professional employer organization or
             186      similar arrangement.
             187          (c) "Regular full-time employee" does not include a classified school employee:
             188          (i) (A) who is hired on or after July 1, 2012; and
             189          (B) who does not receive benefits normally provided by the participating employer
             190      even if the employment normally requires an average of 20 hours per week or more for a
             191      participating employer; or
             192          (ii) (A) who is hired before July 1, 2012;
             193          (B) who does not receive benefits normally provided by the participating employer;
             194      and
             195          (C) whose employment hours are increased on or after July 1, 2012, to require an
             196      average of 20 hours per week or more for a participating employer.
             197          (5) "System" means the Public Employees' Noncontributory Retirement System.
             198          (6) "Years of service credit" means:
             199          (a) a period, consisting of 12 full months as determined by the board;
             200          (b) a period determined by the board, whether consecutive or not, during which a
             201      regular full-time employee performed services for a participating employer, including any time
             202      the regular full-time employee was absent on a paid leave of absence granted by a participating
             203      employer or was absent in the service of the United States government on military duty as
             204      provided by this chapter; or
             205          (c) the regular school year consisting of not less than eight months of full-time service
             206      for a regular full-time employee of an educational institution.
             207          Section 3. Section 49-22-102 is amended to read:
             208           49-22-102. Definitions.
             209          As used in this chapter:
             210          (1) (a) Except as provided in Subsection (1)(c), "compensation" means the total
             211      amount of payments made by a participating employer to a member of this system for services
             212      rendered to the participating employer, including:
             213          (i) bonuses;


             214          (ii) cost-of-living adjustments;
             215          (iii) other payments currently includable in gross income and that are subject to Social
             216      Security deductions, including any payments in excess of the maximum amount subject to
             217      deduction under Social Security law;
             218          (iv) amounts that the member authorizes to be deducted or reduced for salary deferral
             219      or other benefits authorized by federal law; and
             220          (v) member contributions.
             221          (b) "Compensation" for purposes of this chapter may not exceed the amount allowed
             222      under Internal Revenue Code, Section 401(a)(17).
             223          (c) "Compensation" does not include:
             224          (i) the monetary value of remuneration paid in kind, including a residence or use of
             225      equipment;
             226          (ii) the cost of any employment benefits paid for by the participating employer;
             227          (iii) compensation paid to a temporary employee or an employee otherwise ineligible
             228      for service credit;
             229          (iv) any payments upon termination, including accumulated vacation, sick leave
             230      payments, severance payments, compensatory time payments, or any other special payments; or
             231          (v) any allowances or payments to a member for costs or expenses paid by the
             232      participating employer, including automobile costs, uniform costs, travel costs, tuition costs,
             233      housing costs, insurance costs, equipment costs, and dependent care costs.
             234          (d) The executive director may determine if a payment not listed under this Subsection
             235      (1) falls within the definition of compensation.
             236          (2) "Corresponding Tier I system" means the system or plan that would have covered
             237      the member if the member had initially entered employment before July 1, 2011.
             238          (3) "Final average salary" means the amount computed by averaging the highest five
             239      years of annual compensation preceding retirement subject to Subsections (3)(a), (b), (c), and
             240      (d).
             241          (a) Except as provided in Subsection (3)(b), the percentage increase in annual
             242      compensation in any one of the years used may not exceed the previous year's compensation by
             243      more than 10% plus a cost-of-living adjustment equal to the decrease in the purchasing power
             244      of the dollar during the previous year, as measured by a United States Bureau of Labor


             245      Statistics Consumer Price Index average as determined by the board.
             246          (b) In cases where the participating employer provides acceptable documentation to the
             247      office, the limitation in Subsection (3)(a) may be exceeded if:
             248          (i) the member has transferred from another agency; or
             249          (ii) the member has been promoted to a new position.
             250          (c) If the member retires more than six months from the date of termination of
             251      employment, the member is considered to have been in service at the member's last rate of pay
             252      from the date of the termination of employment to the effective date of retirement for purposes
             253      of computing the member's final average salary only.
             254          (d) If the member has less than five years of service credit in this system, final average
             255      salary means the average annual compensation paid to the member during the full period of
             256      service credit.
             257          (4) "Participating employer" means an employer which meets the participation
             258      requirements of:
             259          (a) Sections 49-12-201 and 49-12-202 ;
             260          (b) Sections 49-13-201 and 49-13-202 ;
             261          (c) Section 49-19-201 ; or
             262          (d) Section 49-22-201 or 49-22-202 .
             263          (5) (a) "Regular full-time employee" means an employee whose term of employment
             264      for a participating employer contemplates continued employment during a fiscal or calendar
             265      year and whose employment normally requires an average of 20 hours or more per week,
             266      except as modified by the board, and who receives benefits normally provided by the
             267      participating employer.
             268          (b) "Regular full-time employee" includes:
             269          (i) a teacher whose term of employment for a participating employer contemplates
             270      continued employment during a school year and who teaches half-time or more;
             271          (ii) a classified school employee:
             272          (A) who is hired before July 1, 2012; and
             273          (B) whose employment normally requires an average of 20 hours per week or more for
             274      a participating employer, regardless of benefits provided;
             275          (iii) an appointive officer whose appointed position is full-time as certified by the


             276      participating employer;
             277          (iv) the governor, the lieutenant governor, the state auditor, the state treasurer, the
             278      attorney general, and a state legislator;
             279          (v) an elected official not included under Subsection (5)(b)(iv) whose elected position
             280      is full-time as certified by the participating employer;
             281          (vi) a faculty member or employee of an institution of higher education who is
             282      considered full-time by that institution of higher education; and
             283          (vii) an individual who otherwise meets the definition of this Subsection (5) who
             284      performs services for a participating employer through a professional employer organization or
             285      similar arrangement.
             286          (c) "Regular full-time employee" does not include:
             287          (i) a firefighter service employee as defined in Section 49-23-102 ; [or]
             288          (ii) a public safety service employee as defined in Section 49-23-102 [.];
             289          (iii) a classified school employee:
             290          (A) who is hired on or after July 1, 2012; and
             291          (B) who does not receive benefits normally provided by the participating employer
             292      even if the employment normally requires an average of 20 hours per week or more for a
             293      participating employer; or
             294          (iv) a classified school employee:
             295          (A) who is hired before July 1, 2012;
             296          (B) who does not receive benefits normally provided by the participating employer;
             297      and
             298          (C) whose employment hours are increased on or after July 1, 2012, to require an
             299      average of 20 hours per week or more for a participating employer.
             300          (6) "System" means the New Public Employees' Tier II Contributory Retirement
             301      System created under this chapter.
             302          (7) "Years of service credit" means:
             303          (a) a period, consisting of 12 full months as determined by the board;
             304          (b) a period determined by the board, whether consecutive or not, during which a
             305      regular full-time employee performed services for a participating employer, including any time
             306      the regular full-time employee was absent on a paid leave of absence granted by a participating


             307      employer or was absent in the service of the United States government on military duty as
             308      provided by this chapter; or
             309          (c) the regular school year consisting of not less than eight months of full-time service
             310      for a regular full-time employee of an educational institution.




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    as of 2-13-12 11:04 AM


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