Assembly Bill No. 480–Committee on
Government Affairs

 

March 24, 2003

____________

 

Referred to Committee on Government Affairs

 

SUMMARY—Revises provisions regarding Public Employees’ Retirement System. (BDR 23‑8)

 

FISCAL NOTE:  Effect on Local Government: Yes.

                           Effect on the State: Yes.

 

CONTAINS UNFUNDED MANDATE (§ 2)

(Not Requested by Affected Local Government)

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to the Public Employees’ Retirement System; revising the provisions regarding the purchase of service credit; revising the formula for calculating monthly service retirement allowances; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 286.300 is hereby amended to read as follows:

    286.300  Except as otherwise required as a result of
NRS 286.537:

    1.  Any member of the System may, except as otherwise provided in subsection [4,] 5, purchase all previous creditable service performed with his present employing agency if that service was performed before the enrollment of his agency in the System, even if the service is still creditable in some other system where it cannot be cancelled. The public employer must certify the inclusive dates of employment and number of hours regularly worked by the member to validate the service. The member must pay the full actuarial cost as determined by the actuary.

    2.  In addition to the purchase authorized pursuant to the provisions of subsection 1, any member who has 5 years of

creditable service may, except as otherwise provided in subsection [4,] 5, purchase up to [5] 6 years of service. The member must pay the full actuarial cost of the service as determined by an actuary of the System.

    3.  In addition to the purchases authorized pursuant to the provisions of subsections 1 and 2, any member who has at least 20 years of creditable service may, except as otherwise provided in subsection 5, purchase service credit for not more than 5 years of service he had in any of the following, if that service is not recognized by any other retirement plan:

    (a) As an employee of:

        (1) The Federal Government;

        (2) Another state government;

        (3) A local government or other political subdivision of this or any other state;

        (4) Any combination of subparagraphs (1), (2) and (3).

    (b) As an employee of a qualified educational institution.

    (c) For military service other than as required under the Uniformed Services Employment and Reemployment Rights Act, 38 U.S.C. §§ 4301 et seq.

    4.  In addition to the purchase authorized pursuant to the provisions of subsection 1, any member who:

    (a) Is a licensed teacher;

    (b) Has 5 years of creditable service;

    (c) Is, pursuant to statute, regulation or contract, entitled to payment for unused sick leave; and

    (d) Is employed by the board of trustees of a school district that has, pursuant to subsection 5 of NRS 391.180, provided for the payment of unused sick leave in the form of purchase of
service,

may, except as otherwise provided in subsection [4,] 5, cause to be purchased on his behalf service credit, not to exceed the number of hours of unused sick leave or 1 year, whichever is less. The full actuarial cost of the service as determined by an actuary of the System must be paid for such a purchase. Any service credit purchased pursuant to this subsection must be included as a part of, and is not in addition to, service purchased pursuant to subsection 2.

    [4.] 5. A person who becomes a member of the System for the first time on or after January 1, 2000, may, on or after July 1, 2001, purchase creditable service pursuant to subsection 1 or 2, or cause to be purchased on his behalf service credit pursuant to subsection [3,] 4, only if, at the time of the purchase, he is employed by a participating public employer in a position whose occupant is thereby eligible for membership in the System.

    [5.] 6.  Any member of the System may use:

    (a) All or any portion of the balance of the member’s interest in a qualified trust pursuant to section 401(a) of the Internal Revenue Code, 26 U.S.C. § 401(a); or

    (b) The money contained in an individual retirement account or an individual retirement annuity of a member, the entire amount of which is:

        (1) Attributable to a qualified distribution from a qualified trust pursuant to section 401(a) of the Internal Revenue Code, 26 U.S.C. § 401(a); and

        (2) Qualified as an eligible rollover distribution pursuant to section 402 of the Internal Revenue Code, 26 U.S.C. § 402,

to purchase creditable service pursuant to subsection 1 or 2.

    [6.] 7.  A member of the System who purchases creditable service pursuant to subsection 1 or 2 is entitled to receive a refund of any contributions paid toward the purchase of the service only if he is no longer in the employ of a participating public employer.

    [7.] 8.  If a member of the System enters into an agreement whereby he agrees to pay for the purchase of service credit in installments and he defaults on that agreement, the member is entitled to receive service credit in the proportion that the principal paid bears to the principal due under the agreement.

1-1  Sec. 2. NRS 286.551 is hereby amended to read as follows:

1-2  286.551  Except as otherwise required as a result of NRS

1-3  286.535 or 286.537:

1-4  1.  Except as otherwise provided in this subsection, a monthly

1-5  service retirement allowance must be determined by multiplying a

1-6  member’s average compensation by 2.5 percent for each year of

1-7  service earned before July 1, 2001, [and] 2.67 percent for each year

1-8  of service earned on or after July 1, 2001, and before July 1, 2003,

1-9  and 2.75 percent for each year of service earned on or after July 1,

1-10  2003, except that a member:

1-11      (a) Who has an effective date of membership on or after July 1,

1-12  1985, is entitled to a benefit of not more than 75 percent of his

1-13  average compensation with his eligibility for service credit ceasing

1-14  at 30 years of service.

1-15      (b) Who has an effective date of membership before July 1,

1-16  1985, and retires on or after July 1, 1977, is entitled to a benefit of

1-17  not more than 90 percent of his average compensation with his

1-18  eligibility for service credit ceasing at 36 years of service.

1-19  In no case may the service retirement allowance determined

1-20  pursuant to this section be less than the allowance to which the

1-21  retired employee would have been entitled pursuant to the

1-22  provisions of this section which were in effect on the day before

1-23  July 3, 1991.

2-1  2.  For the purposes of this section, except as otherwise

2-2  provided in subsection 3, “average compensation” means the

2-3  average of a member’s 36 consecutive months of highest

2-4  compensation as certified by the public employer.

2-5  3.  The average compensation of a member who has a break in

2-6  service or partial months of compensation, or both, as a result of

2-7  service as a Legislator during a regular or special session of the

2-8  Nevada Legislature must be calculated on the basis of the average of

2-9  his 36 consecutive months of highest compensation as certified by

2-10  his public employer excluding each month during any part of which

2-11  the Legislature was in session. This subsection does not affect the

2-12  computation of years of service.

2-13      4.  The retirement allowance for a regular part-time employee

2-14  must be computed from the salary which he would have received as

2-15  a full-time employee if it results in greater benefits for the

2-16  employee. A regular part-time employee is a person who works half

2-17  time or more, but less than full time:

2-18      (a) According to the regular schedule established by the

2-19  employer for his position; and

2-20      (b) Pursuant to an established agreement between the employer

2-21  and the employee.

2-22      Sec. 3.  NRS 391.180 is hereby amended to read as follows:

2-23      391.180  1.  As used in this section, “employee” means any

2-24  employee of a school district or charter school in this state.

2-25      2.  A school month in any public school in this state consists of

2-26  4 weeks of 5 days each.

2-27      3.  Nothing contained in this section prohibits the payment of

2-28  employees’ compensation in 12 equal monthly payments for 9 or

2-29  more months’ work.

2-30      4.  The per diem deduction from the salary of an employee

2-31  because of absence from service for reasons other than those

2-32  specified in this section is that proportion of the yearly salary which

2-33  is determined by the ratio between the duration of the absence and

2-34  the total number of contracted workdays in the year.

2-35      5.  Boards of trustees shall either prescribe by regulation or

2-36  negotiate pursuant to chapter 288 of NRS, with respect to sick leave,

2-37  accumulation of sick leave, payment for unused sick leave,

2-38  sabbatical leave, personal leave, professional leave, military leave

2-39  and such other leave as they determine to be necessary or desirable

2-40  for employees. In addition, boards of trustees may either prescribe

2-41  by regulation or negotiate pursuant to chapter 288 of NRS with

2-42  respect to the payment of unused sick leave to licensed teachers in

2-43  the form of purchase of service pursuant to subsection [3] 4 of NRS

2-44  286.300. The amount of service so purchased must not exceed the

2-45  number of hours of unused sick leave or 1 year, whichever is less.

3-1  6.  The salary of any employee unavoidably absent because of

3-2  personal illness or accident, or because of serious illness, accident or

3-3  death in the family, may be paid up to the number of days of sick

3-4  leave accumulated by the employee. An employee may not be

3-5  credited with more than 15 days of sick leave in any 1 school year.

3-6  Except as otherwise provided in this subsection, if an employee

3-7  takes a position with another school district or charter school, all

3-8  sick leave that he has accumulated must be transferred from his

3-9  former school district or charter school to his new school district or

3-10  charter school. The amount of sick leave so transferred may not

3-11  exceed the maximum amount of sick leave which may be carried

3-12  forward from one year to the next according to the applicable

3-13  negotiated agreement or the policy of the district or charter school

3-14  into which the employee transferred. Unless the applicable

3-15  negotiated agreement or policy of the employing district or charter

3-16  school provides otherwise, such an employee:

3-17      (a) Shall first use the sick leave credited to the employee from

3-18  the district or charter school into which he transferred before using

3-19  any of the transferred leave; and

3-20      (b) Is not entitled to compensation for any sick leave transferred

3-21  pursuant to this subsection.

3-22      7.  Subject to the provisions of subsection 8:

3-23      (a) If an intermission of less than 6 days is ordered by the board

3-24  of trustees of a school district or the governing body of a charter

3-25  school for any good reason, no deduction of salary may be made

3-26  therefor.

3-27      (b) If, on account of sickness, epidemic or other emergency in

3-28  the community, a longer intermission is ordered by the board of

3-29  trustees of a school district, the governing body of a charter school

3-30  or a board of health and the intermission or closing does not exceed

3-31  30 days at any one time, there may be no deduction or

3-32  discontinuance of salaries.

3-33      8.  If the board of trustees of a school district or the governing

3-34  body of a charter school orders an extension of the number of days

3-35  of school to compensate for the days lost as the result of an

3-36  intermission because of those reasons contained in paragraph (b) of

3-37  subsection 7, an employee may be required to render his services to

3-38  the school district or charter school during that extended period. If

3-39  the salary of the employee was continued during the period of

3-40  intermission as provided in subsection 7, the employee is not

3-41  entitled to additional compensation for services rendered during the

3-42  extended period.

3-43      9.  If any subject referred to in this section is included in an

3-44  agreement or contract negotiated by:

4-1  (a) The board of trustees of a school district pursuant to chapter

4-2  288 of NRS; or

4-3  (b) The governing body of a charter school pursuant to

4-4  NRS 386.595,

4-5  the provisions of the agreement or contract regarding that subject

4-6  supersede any conflicting provisions of this section or of a

4-7  regulation of the board of trustees.

4-8  Sec. 4.  This act becomes effective on July 1, 2003.

 

4-9  H