S PEN ORG2 2/29/CFB
Senate Bill No. 596
(By Senator Plymale)
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[Originating in the Committee on Pensions;
reported February 29, 1996.]
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A BILL to amend and reenact section thirty-one-a, article ten,
chapter five of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, relating to contributions for
retroactive service credit; prohibiting the requirement of
interest on employer contributions for retroactive service
credit on service performed before the first day of January,
one thousand nine hundred and eighty-nine.
Be it enacted by the Legislature of West Virginia:
That section thirty-one-a, article ten, chapter five of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:
§5-10-31a. Retroactive contributions to the retirement system for
retroactive service credit granted; one year period for
application.
Those public employers who are participating in the West
Virginia public employees retirement system and elected to
participate after the first day of July, one thousand nine hundred
sixty-one, and those employers who are eligible but who have not elected to participate, may elect to cover their employees
retroactive for the period of their prior employment by such
employer to the first day of July, one thousand nine hundred sixty-
one, under the following terms and rules and regulations to be
promulgated by the board of trustees of the retirement system:
(a) The participating employer, in order to provide the
benefits set forth herein, shall pay an additional contribution to
the retirement system as shall be the actuarial equivalent of the
amount which would have been contributed, together with earnings
thereon, by the employer had the employee who is to receive
retroactive credit been covered during the period of the
retroactive service credit. This contribution may be made by the
employer either in one lump sum or, at the election of the
employer, by level term payments over a period not in excess of
fifteen years or by both lump sum payments and level term payments,
as determined by the employer and the board of trustees under rules
and regulations promulgated by the board; Provided, That no
earnings or interest shall be paid by the employer for service
performed before the first day of January, one thousand, nine
hundred and eighty-nine.
(b) The additional service credit shall be applicable to
employees working for the participating employer on the effective
date of the change of date of participation;
(c) There shall be no increase in benefits and annuities paid
to former members of the system who were retired prior to the
effective date of this section;
(d) Employees entitled to such retroactive service credit
under the provisions of this section shall make such additional
contribution to the retirement system equal to the actuarial
equivalent of the amount which would have been contributed,
together with earnings thereon, by the employee had the employee
been covered during the period of the retroactive service credit;
(e) Each employer and employee shall be required to pay into
the retirement system in the manner hereinafter provided the amount
necessary for the additional service credit provided by this
section, based upon an actuarial study of each employer that elects
to participate in the retirement system under this section and as
determined by the board of trustees;
(f) The actuarial basis for determining the additional
contributions shall be that currently in effect for the valuation
of the retirement system on the effective date of the employer's
election;
(g) Any new participating employer and any participating
employer which is currently a participant and who began
participating after the first day of July, one thousand nine
hundred sixty-one, who desires additional service credit must elect
to provide such service credit within one year following the
effective date of this section;
(h) Any participating employer requesting additional service
credit as provided by this section shall provide such employee data
as may be requested from the board of trustees of the retirement
system for the determination of the employer's contributions;
(i) The consulting actuary's fees for computing the additional
contribution rates under this section shall be paid directly by the
participating employer to the consulting actuary selected by the
board of trustees of the retirement system; and
(j) For the purpose of reopening the effectiveness of the
provisions of this section for a period of one year following the
effective date of the amendment to this section, [Acts 1988,
c. 101: March 12, 1988] and for the purpose of granting,
retroactively service credit to current employees of employers
participating in the public employees retirement system during such
period, this section is hereby renewed and reestablished; but any
such credited service granted hereunder shall be on the actuarially
sound basis for determining required additional contributions, of
both employer and employee, required in light of benefits that
would be computed in respect of such later point in time and such
subsequent final average salary amount.