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H.B. 255

             1     

CLASSIFIED SCHOOL EMPLOYEE AMENDMENTS

             2     
2013 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Bradley G. Last

             5     
Senate Sponsor: Stephen H. Urquhart

             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, 2013, and does not receive benefits normally
             17      provided by the participating employer; or
             18              .    who is hired before July 1, 2013, who did not qualify as a regular full-time
             19      employee before July 1, 2013, who does not receive benefits normally provided
             20      by the participating employer, and whose employment hours are increased on or
             21      after July 1, 2013; and    
             22          .    makes technical changes.
             23      Money Appropriated in this Bill:
             24          None
             25      Other Special Clauses:
             26          This bill takes effect on July 1, 2013.
             27      Utah Code Sections Affected:


             28      AMENDS:
             29          49-12-102, as last amended by Laws of Utah 2012, Chapter 298
             30          49-13-102, as last amended by Laws of Utah 2012, Chapter 298
             31          49-22-102, as last amended by Laws of Utah 2011, Chapter 439
             32     
             33      Be it enacted by the Legislature of the state of Utah:
             34          Section 1. Section 49-12-102 is amended to read:
             35           49-12-102. Definitions.
             36          As used in this chapter:
             37          (1) (a) Except as provided in Subsection (1)(c), "compensation" means the total
             38      amount of payments made by a participating employer to a member of this system for services
             39      rendered to the participating employer, including:
             40          (i) bonuses;
             41          (ii) cost-of-living adjustments;
             42          (iii) other payments currently includable in gross income and that are subject to Social
             43      Security deductions, including any payments in excess of the maximum amount subject to
             44      deduction under Social Security law;
             45          (iv) amounts that the member authorizes to be deducted or reduced for salary deferral
             46      or other benefits authorized by federal law; and
             47          (v) member contributions.
             48          (b) "Compensation" for purposes of this chapter may not exceed the amount allowed
             49      under Internal Revenue Code, Section 401(a)(17).
             50          (c) "Compensation" does not include:
             51          (i) the monetary value of remuneration paid in kind, including a residence or use of
             52      equipment;
             53          (ii) the cost of any employment benefits paid for by the participating employer;
             54          (iii) compensation paid to a temporary employee, an exempt employee, or an employee
             55      otherwise ineligible for service credit;
             56          (iv) any payments upon termination, including accumulated vacation, sick leave
             57      payments, severance payments, compensatory time payments, or any other special payments; or
             58          (v) any allowances or payments to a member for costs or expenses paid by the


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


             90          (i) a teacher whose term of employment for a participating employer contemplates
             91      continued employment during a school year and who teaches half time or more;
             92          (ii) a classified school employee:
             93          (A) who is hired before July 1, 2013; and
             94          (B) whose employment normally requires an average of 20 hours per week or more for
             95      a participating employer, regardless of benefits provided;
             96          (iii) an officer, elective or appointive, who earns $500 or more per month, indexed as
             97      of January 1, 1990, as provided in Section 49-12-407 ;
             98          (iv) a faculty member or employee of an institution of higher education who is
             99      considered full time by that institution of higher education; and
             100          (v) an individual who otherwise meets the definition of this Subsection (4) who
             101      performs services for a participating employer through a professional employer organization or
             102      similar arrangement.
             103          (c) "Regular full-time employee" does not include a classified school employee:
             104          (i) (A) who is hired on or after July 1, 2013; and
             105          (B) who does not receive benefits normally provided by the participating employer
             106      even if the employment normally requires an average of 20 hours per week or more for a
             107      participating employer; or
             108          (ii) (A) who is hired before July 1, 2013;
             109          (B) who did not qualify as a regular full-time employee before July 1, 2013;
             110          (C) who does not receive benefits normally provided by the participating employer;
             111      and
             112          (D) whose employment hours are increased on or after July 1, 2013, to require an
             113      average of 20 hours per week or more for a participating employer.
             114          (5) "System" means the Public Employees' Contributory Retirement System created
             115      under this chapter.
             116          (6) "Years of service credit" means:
             117          (a) a period[,] consisting of 12 full months as determined by the board;
             118          (b) a period determined by the board, whether consecutive or not, during which a
             119      regular full-time employee performed services for a participating employer, including any time
             120      the regular full-time employee was absent on a paid leave of absence granted by a participating


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


             152      (1) falls within the definition of compensation.
             153          (2) "Final average salary" means the amount computed by averaging the highest three
             154      years of annual compensation preceding retirement subject to the following:
             155          (a) Except as provided in Subsection (2)(b), the percentage increase in annual
             156      compensation in any one of the years used may not exceed the previous year's compensation by
             157      more than 10% plus a cost-of-living adjustment equal to the decrease in the purchasing power
             158      of the dollar during the previous year, as measured by a United States Bureau of Labor
             159      Statistics Consumer Price Index average as determined by the board.
             160          (b) In cases where the participating employer provides acceptable documentation to the
             161      office, the limitation in Subsection (2)(a) may be exceeded if:
             162          (i) the member has transferred from another agency; or
             163          (ii) the member has been promoted to a new position.
             164          (c) If the member retires more than six months from the date of termination of
             165      employment and for purposes of computing the member's final average salary only, the
             166      member is considered to have been in service at [his] the member's last rate of pay from the
             167      date of the termination of employment to the effective date of retirement.
             168          (3) "Participating employer" means an employer which meets the participation
             169      requirements of Sections 49-13-201 and 49-13-202 .
             170          (4) (a) "Regular full-time employee" means an employee whose term of employment
             171      for a participating employer contemplates continued employment during a fiscal or calendar
             172      year and whose employment normally requires an average of 20 hours or more per week,
             173      except as modified by the board, and who receives benefits normally provided by the
             174      participating employer.
             175          (b) "Regular full-time employee" includes:
             176          (i) a teacher whose term of employment for a participating employer contemplates
             177      continued employment during a school year and who teaches half time or more;
             178          (ii) a classified school employee:
             179          (A) who is hired before July 1, 2013; and
             180          (B) whose employment normally requires an average of 20 hours per week or more for
             181      a participating employer, regardless of benefits provided;
             182          (iii) an officer, elective or appointive, who earns $500 or more per month, indexed as


             183      of January 1, 1990, as provided in Section 49-13-407 ;
             184          (iv) a faculty member or employee of an institution of higher education who is
             185      considered full time by that institution of higher education; and
             186          (v) an individual who otherwise meets the definition of this Subsection (4) who
             187      performs services for a participating employer through a professional employer organization or
             188      similar arrangement.
             189          (c) "Regular full-time employee" does not include a classified school employee:
             190          (i) (A) who is hired on or after July 1, 2013; and
             191          (B) who does not receive benefits normally provided by the participating employer
             192      even if the employment normally requires an average of 20 hours per week or more for a
             193      participating employer; or
             194          (ii) (A) who is hired before July 1, 2013;
             195          (B) who did not qualify as a regular full-time employee before July 1, 2013;
             196          (C) who does not receive benefits normally provided by the participating employer;
             197      and
             198          (D) whose employment hours are increased on or after July 1, 2013, to require an
             199      average of 20 hours per week or more for a participating employer.
             200          (5) "System" means the Public Employees' Noncontributory Retirement System.
             201          (6) "Years of service credit" means:
             202          (a) a period[,] consisting of 12 full months as determined by the board;
             203          (b) a period determined by the board, whether consecutive or not, during which a
             204      regular full-time employee performed services for a participating employer, including any time
             205      the regular full-time employee was absent on a paid leave of absence granted by a participating
             206      employer or was absent in the service of the United States government on military duty as
             207      provided by this chapter; or
             208          (c) the regular school year consisting of not less than eight months of full-time service
             209      for a regular full-time employee of an educational institution.
             210          Section 3. Section 49-22-102 is amended to read:
             211           49-22-102. Definitions.
             212          As used in this chapter:
             213          (1) (a) Except as provided in Subsection (1)(c), "compensation" means the total


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


             245      compensation in any one of the years used may not exceed the previous year's compensation by
             246      more than 10% plus a cost-of-living adjustment equal to the decrease in the purchasing power
             247      of the dollar during the previous year, as measured by a United States Bureau of Labor
             248      Statistics Consumer Price Index average as determined by the board.
             249          (b) In cases where the participating employer provides acceptable documentation to the
             250      office, the limitation in Subsection (3)(a) may be exceeded if:
             251          (i) the member has transferred from another agency; or
             252          (ii) the member has been promoted to a new position.
             253          (c) If the member retires more than six months from the date of termination of
             254      employment, the member is considered to have been in service at the member's last rate of pay
             255      from the date of the termination of employment to the effective date of retirement for purposes
             256      of computing the member's final average salary only.
             257          (d) If the member has less than five years of service credit in this system, final average
             258      salary means the average annual compensation paid to the member during the full period of
             259      service credit.
             260          (4) "Participating employer" means an employer which meets the participation
             261      requirements of:
             262          (a) Sections 49-12-201 and 49-12-202 ;
             263          (b) Sections 49-13-201 and 49-13-202 ;
             264          (c) Section 49-19-201 ; or
             265          (d) Section 49-22-201 or 49-22-202 .
             266          (5) (a) "Regular full-time employee" means an employee whose term of employment
             267      for a participating employer contemplates continued employment during a fiscal or calendar
             268      year and whose employment normally requires an average of 20 hours or more per week,
             269      except as modified by the board, and who receives benefits normally provided by the
             270      participating employer.
             271          (b) "Regular full-time employee" includes:
             272          (i) a teacher whose term of employment for a participating employer contemplates
             273      continued employment during a school year and who teaches half time or more;
             274          (ii) a classified school employee:
             275          (A) who is hired before July 1, 2013; and


             276          (B) whose employment normally requires an average of 20 hours per week or more for
             277      a participating employer, regardless of benefits provided;
             278          (iii) an appointive officer whose appointed position is full time as certified by the
             279      participating employer;
             280          (iv) the governor, the lieutenant governor, the state auditor, the state treasurer, the
             281      attorney general, and a state legislator;
             282          (v) an elected official not included under Subsection (5)(b)(iv) whose elected position
             283      is full time as certified by the participating employer;
             284          (vi) a faculty member or employee of an institution of higher education who is
             285      considered full time by that institution of higher education; and
             286          (vii) an individual who otherwise meets the definition of this Subsection (5) who
             287      performs services for a participating employer through a professional employer organization or
             288      similar arrangement.
             289          (c) "Regular full-time employee" does not include:
             290          (i) a firefighter service employee as defined in Section 49-23-102 ; [or]
             291          (ii) a public safety service employee as defined in Section 49-23-102 [.];
             292          (iii) a classified school employee:
             293          (A) who is hired on or after July 1, 2013; and
             294          (B) who does not receive benefits normally provided by the participating employer
             295      even if the employment normally requires an average of 20 hours per week or more for a
             296      participating employer; or
             297          (iv) a classified school employee:
             298          (A) who is hired before July 1, 2013;
             299          (B) who did not qualify as a regular full-time employee before July 1, 2013;
             300          (C) who does not receive benefits normally provided by the participating employer;
             301      and
             302          (D) whose employment hours are increased on or after July 1, 2013, to require an
             303      average of 20 hours per week or more for a participating employer.
             304          (6) "System" means the New Public Employees' Tier II Contributory Retirement
             305      System created under this chapter.
             306          (7) "Years of service credit" means:


             307          (a) a period[,] consisting of 12 full months as determined by the board;
             308          (b) a period determined by the board, whether consecutive or not, during which a
             309      regular full-time employee performed services for a participating employer, including any time
             310      the regular full-time employee was absent on a paid leave of absence granted by a participating
             311      employer or was absent in the service of the United States government on military duty as
             312      provided by this chapter; or
             313          (c) the regular school year consisting of not less than eight months of full-time service
             314      for a regular full-time employee of an educational institution.
             315          Section 4. Effective date.
             316          This bill takes effect on July 1, 2013.




Legislative Review Note
    as of 1-3-13 10:33 AM


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