Senate Bill No. 159
(By Senator Hunter)
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[Introduced January 20, 2000; referred to the Committee
on Pensions; and then to the Committee on Finance.]
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A BILL to amend and reenact sections two, twenty-one and
twenty-two, article ten, chapter five of the code of West
Virginia, one thousand nine hundred thirty-one, as amended,
all relating to defining "limited credited service"; providing
state public employees may retire with full pension benefits
if the sum of an employee's age plus years of service and
limited credited service equals or exceeds eighty; providing
that the credited service used to calculate the straight life
annuity under section twenty-two of said article, chapter five
of said code does not include any period of limited credited
service; and providing that any member receiving an annuity
based in part on limited service is not eligible for the
supplements provided for in sections twenty-two-a through twenty-two-d, inclusive, of said article.
Be it enacted by the Legislature of West Virginia:
That sections two, twenty-one and twenty-two, article ten,
chapter five of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, be amended and reenacted, all to
read as follows:
ARTICLE 10. WEST VIRGINIA PUBLIC EMPLOYEES RETIREMENT ACT.
§5-10-2. Definitions.
The following words and phrases as used in this article,
unless a different meaning is clearly indicated by the context,
have the following meanings:
(1) "State" means the state of West Virginia;
(2) "Retirement system" or "system" means the West Virginia
public employees retirement system created and established by this
article;
(3) "Board of trustees" or "board" means the board of trustees
of the West Virginia public employees retirement system;
(4) "Political subdivision" means the state of West Virginia,
a county, city or town in the state; a school corporation or
corporate unit; any separate corporation or instrumentality
established by one or more counties, cities or towns, as permitted
by law; any corporation or instrumentality supported in most part by counties, cities or towns; any public corporation charged by law
with the performance of a governmental function and whose
jurisdiction is coextensive with one or more counties, cities or
towns: Provided, That any mental health agency participating in
the public employees retirement system before the first day of
July, one thousand nine hundred ninety-seven, is considered a
political subdivision solely for the purpose of permitting those
employees who are members of the public employees retirement system
to remain members and continue to participate in the retirement
system at their option after the first day of July, one thousand
nine hundred ninety-seven;
(5) "Participating public employer" means the state of West
Virginia, any board, commission, department, institution or
spending unit, and includes any agency created by rule of the
supreme court of appeals having full-time employees, which for the
purposes of this article is considered a department of state
government; and any political subdivision in the state which has
elected to cover its employees, as defined in this article, under
the West Virginia public employees retirement system;
(6) "Employee" means any person who serves regularly as an
officer or employee, full time, on a salary basis, whose tenure is
not restricted as to temporary or provisional appointment, in the service of, and whose compensation is payable, in whole or in part,
by any political subdivision, or an officer or employee whose
compensation is calculated on a daily basis and paid monthly or on
completion of assignment, including technicians and other personnel
employed by the West Virginia national guard whose compensation, in
whole or in part, is paid by the federal government: Provided,
That members of the state Legislature, the clerk of the House of
Delegates, the clerk of the state Senate, employees of the state
Legislature whose term of employment is otherwise classified as
temporary and who are employed to perform services required by the
Legislature for its regular sessions or during the interim between
regular sessions and who have been or are employed during regular
sessions or during the interim between regular sessions in seven
consecutive calendar years, as certified by the clerk of the house
in which the employee served, members of the legislative body of
any political subdivision and judges of the state court of claims
are considered to be employees, anything contained in this article
to the contrary notwithstanding. In any case of doubt as to who is
an employee within the meaning of this article the board of
trustees shall decide the question;
(7) "Member" means any person who is included in the
membership of the retirement system;
(8) "Retirant" means any member who retires with an annuity
payable by the retirement system;
(9) "Beneficiary" means any person, except a retirant, who is
entitled to, or will be entitled to, an annuity or other benefit
payable by the retirement system;
(10) "Service" means personal service rendered to a
participating public employer by an employee, as defined in this
article, of a participating public employer;
(11) "Prior service" means service rendered prior to the first
day of July, one thousand nine hundred sixty-one, to the extent
credited a member as provided in this article;
(12) "Contributing service" means service rendered by a member
within this state and for which the member made contributions to a
public retirement system account of this state, to the extent
credited him or her as provided by this article. This revised
definition is retroactive and applicable to the first day of April,
one thousand nine hundred eighty-eight, and thereafter;
(13) "Credited service" means the sum of a member's prior
service credit and contributing service credit standing to his or
her credit as provided in this article;
(14) "Limited credited service" means service by employees of
the West Virginia educational broadcasting authority, in the employment of West Virginia University, during a period when the
employee made contributions to another retirement system, as
required by West Virginia University, and did not make
contributions to the public employees retirement system: Provided,
That, while limited credited service can be used for the formula
set forth in section twenty-one, subsection (e) of this article, it
may not be used to increase benefits calculated under section
twenty-two of this article;
(14) (15) "Compensation" means the remuneration paid a member
by a participating public employer for personal services rendered
by him or her to the participating public employer. In the event
a member's remuneration is not all paid in money, his or her
participating public employer shall fix the value of the portion of
his or her remuneration which is not paid in money;
(15) (16) "Final average salary" means either: (a) The
average of the highest annual compensation received by a member
(including a member of the Legislature who participates in the
retirement system in the year one thousand nine hundred seventy-one
or thereafter) during any period of three consecutive years of his
or her credited service contained within his or her ten years of
credited service immediately preceding the date his or her
employment with a participating public employer last terminated; or (b) if he or she has less than five years of credited service, the
average of the annual rate of compensation received by him or her
during his or her total years of credited service; and in
determining the annual compensation, under either (a) or (b) of
this subdivision, of a member of the Legislature who participates
in the retirement system as a member of the Legislature in the year
one thousand nine hundred seventy-one or in any year thereafter,
his or her actual legislative compensation (the total of all
compensation paid under sections two, three, four and five, article
two-a, chapter four of this code) in the year one thousand nine
hundred seventy-one or in any year thereafter, plus any other
compensation he or she receives in any such year from any other
participating public employer including the state of West Virginia,
without any multiple in excess of one times his or her actual
legislative compensation and other compensation, shall be used:
Provided, That "final average salary" for any former member of the
Legislature or for any member of the Legislature in the year one
thousand nine hundred seventy-one who, in either event, was a
member of the Legislature on the thirtieth day of November, one
thousand nine hundred sixty-eight, or the thirtieth day of
November, one thousand nine hundred sixty-nine, or the thirtieth
day of November, one thousand nine hundred seventy, or on the thirtieth day of November in any one or more of those three years,
and who participated in the retirement system as a member of the
Legislature in any one or more of those years means: (i) Either
(notwithstanding the provisions of this subdivision preceding this
proviso) one thousand five hundred dollars multiplied by eight,
plus the highest other compensation the former member or member
received in any one of the three years from any other participating
public employer including the state of West Virginia; or (ii)
"final average salary" determined in accordance with (a) or (b) of
this subdivision, whichever computation shall produce the higher
final average salary (and in determining the annual compensation
under (ii) of this proviso, the legislative compensation of the
former member shall be computed on the basis of one thousand five
hundred dollars multiplied by eight, and the legislative
compensation of the member shall be computed on the basis set forth
in the provisions of this subdivision immediately preceding this
proviso or on the basis of one thousand five hundred dollars
multiplied by eight, whichever computation as to the member
produces the higher annual compensation);
(16) (17) "Accumulated contributions" means the sum of all
amounts deducted from the compensations of a member and credited to
his or her individual account in the members' deposit fund, together with regular interest on the contributions;
(17) (18) "Regular interest" means the rate or rates of
interest per annum, compounded annually, as the board of trustees
adopts from time to time;
(18) (19) "Annuity" means an annual amount payable by the
retirement system throughout the life of a person. All annuities
shall be paid in equal monthly installments, using the upper cent
for any fraction of a cent;
(19) (20) "Annuity reserve" means the present value of all
payments to be made to a retirant or beneficiary of a retirant on
account of any annuity, computed upon the basis of such mortality
and other tables of experience, and regular interest, as the board
of trustees adopts from time to time;
(20) (21) "Retirement" means a member's withdrawal from the
employ of a participating public employer with an annuity payable
by the retirement system; and
(21) (22) "Actuarial equivalent" means a benefit of equal
value computed upon the basis of such mortality table and regular
interest as the board of trustees adopts from time to time.
§5-10-21. Deferred retirement and early retirement.
(a) Any member, who has five or more years of credited service
in force, of which at least three years are contributing service, and who leaves the employ of a participating public employer prior
to his or her attainment of age sixty years, for any reason except
his or her disability retirement or death, shall be entitled to an
annuity computed according to section twenty-two of this article,
as the said section was in force as of the date of his or her said
separation from the employ of a participating public employer:
Provided, That he or she does not withdraw his or her accumulated
contributions from the members' deposit fund. His or her said
annuity shall begin the first day of the calendar month next
following the month in which his or her application for same is
filed with the board of trustees on or after his or her attainment
of age sixty-two years.
(b) Any member who qualifies for deferred retirement benefits
in accordance with subsection (a) of this section, and has ten or
more years of credited service in force and who has attained age
fifty-five as of the date of his or her separation may, prior to
the effective date of his or her retirement, but not thereafter,
elect to receive the actuarial equivalent of his or her deferred
retirement annuity as a reduced annuity commencing on the first day
of any calendar month between his or her date of separation and his
or her attainment of age sixty-two years and payable throughout his
or her life.
(c) Any member who qualifies for deferred retirement benefits
in accordance with subsection (a) of this section, and has twenty
or more years of credited service in force, may elect to receive
the actuarial equivalent of his or her deferred retirement annuity
as a reduced annuity commencing on the first day of any calendar
month between his or her fifty-fifth birthday and his or her
attainment of age sixty-two years and payable throughout his or her
life.
(d) Notwithstanding any of the other provisions of this
section or of this article and pursuant to regulations promulgated
by the board, any member who has thirty or more years of credited
service in force, at least three of which are contributing service,
and who elects to take early retirement, which for the purposes of
this subsection shall mean retirement prior to age sixty, whether
an active employee or a separated employee at the time of
application, shall be entitled to the full computation of annuity
according to section twenty-two of this article, as the said
section was in force as of the date of retirement application, but
with the reduced actuarial equivalent of the annuity the member
would have received if his or her benefit had commenced at age
sixty when he or she would have been entitled to full computation
of benefit without any reduction.
(e) Notwithstanding any of the other provisions of this
section or of this article, any member of the retirement system may
retire with full pension rights, without reduction of benefits, if
such member is at least fifty-five years of age and the sum of his
or her age plus years of contributing service and limited credited
service as defined in section two of this article equals or exceeds
eighty.
§5-10-22. Retirement annuity.
Upon a member's retirement, as provided in this article, he or
she shall receive a straight life annuity equal to one and
five-tenths percent of his or her final average salary multiplied
by the number of years, and fraction of a year, of his or her
credited service in force at the time of his or her retirement.
The credited service used for this calculation may not include any
period of limited credited service: Provided, That after March
one, one thousand nine hundred seventy, all members retired and all
members retiring shall receive a straight life annuity equal to two
percent of his or her final average salary multiplied by the number
of years, and fraction of a year, of his or her credited service,
exclusive of limited credited service in force at the time of his
or her retirement. In either event, upon his or her retirement he
or she shall have the right to elect an option provided for in section twenty-four of this article. All annuity payments shall
commence effective the first of the month following the month in
which a member retires or a member dies leaving a beneficiary
entitled to benefits and shall continue to the end of the month in
which said retirant or beneficiary dies, and said annuity payments
shall not be prorated for any portion of a month in which a member
retires or retirant or beneficiary dies. Any member receiving an
annuity based in part upon limited credited service is not eligible
for the supplements provided for in sections twenty-two-a through
twenty-two-d of this article.
The annuity of any member of the Legislature who participates
in the retirement system as a member of the Legislature and who
retires under this article or of any former member of the
Legislature who has retired under this article (including any
former member of the Legislature who has retired under this article
and whose annuity was readjusted as of March one, one thousand nine
hundred seventy, under the former provisions of this section) shall
be increased from time to time during the period of his or her
retirement when and if the legislative compensation paid under
section two, article two-a, chapter four of this code to a member
of the Legislature shall be increased to the point where a higher
annuity would be payable to the retirant if he or she were retiring as of the effective date of the latest increase in such legislative
compensation, but on the basis of his or her years of credited
service to the date of his or her actual retirement.
NOTE: The purpose of this bill is to define "limited credited
service," providing state public employees may retire with full
pension benefits if the sum of an employee's age plus years of
service and limited credited service equals or exceeds eighty;
provide that the credited service used to calculate the straight
life annuity under section twenty-two, article ten, chapter five
does not include any period of limited credited service; and,
provide that any member receiving an annuity based in part on
limited service is not eligible for the supplements provided for in
sections twenty-two-a through twenty-two-d, article ten, chapter
five.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.