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H. 3251
STATUS INFORMATION
General Bill
Sponsors: Rep. Stille
Document Path: l:\council\bills\ggs\22730htc03.doc
Introduced in the House on January 14, 2003
Currently residing in the House Committee on Ways and Means
Summary: Public Employees Defined Contribution Plan
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number ------------------------------------------------------------------------------- 12/18/2002 House Prefiled 12/18/2002 House Referred to Committee on Ways and Means 1/14/2003 House Introduced and read first time HJ-103 1/14/2003 House Referred to Committee on Ways and Means HJ-103
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
TO AMEND TITLE 9, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO STATE RETIREMENT SYSTEMS BY ADDING CHAPTER 19 SO AS TO ENACT THE PUBLIC EMPLOYEES' DEFINED CONTRIBUTION RETIREMENT PLAN AND PROVIDE FOR ITS MEMBERSHIP, OPERATIONS, AND ADMINISTRATION.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Title 9 of the 1976 Code is amended by adding:
Section 9-19-10. This chapter may be cited as the Public Employees' Defined Contribution Retirement Plan.
Section 9-19-20. As used in this chapter:
(1) 'Board' means the State Budget and Control Board.
(2) 'Defined contribution plan' or 'plan' means the defined contribution plans authorized by this chapter as those plans may be established by the board including one established to replace the South Carolina Police Officers Retirement System and one established to replace the South Carolina Retirement System.
(3) 'Existing retirement system' means the South Carolina Retirement System established pursuant to Chapter 1 of this title and the Police Officers Retirement System established pursuant to Chapter 11 of this Title.
(4) 'Member' has the meaning provided in Sections 9-1-10(18) for persons who otherwise would be members of the South Carolina Retirement System and 9-11-10(19) for persons who otherwise would be members of the South Carolina Police Officers Retirement System.
(5) 'Employer' has the meaning provided in Sections 9-1-10(14) and 9-11-10(17).
(6) 'Compensation' or 'earnable compensation' has the meaning provided in Sections 9-1-10(8) and 9-11-10(12).
(7) 'Member contribution' means an amount reduced from the employee's regular pay periods and deposited into the member's individual account within a defined contribution plan but not less than the amount withheld from the employee if the employee was a member of the applicable existing retirement system.
(8) 'Employer contribution' means an amount deposited into the member's individual account on a periodic basis coinciding with the employee's regular pay period by an employer from its own funds but not less than the amount contributed on behalf of a state employee member if the employee was a member of the applicable existing retirement system.
(9) 'Individual account' or 'account' means an account in a defined contribution plan established for each member to record the deposit of member and employer contributions and earnings thereon on behalf of the member.
(10) 'Retirement' means a member's withdrawal from the active employment of a participating employer and completion of all conditions precedent to retirement.
(11) 'Fund' means the Public Employees' Defined Contribution Retirement Plan Fund.
(12) 'Administrator' means the board or the service provider hired by the board to provide plan administration services to the plan.
Section 9-19-30. (A) Members first employed after June 30, 2003, are not members of existing retirement systems but instead are members of the plan established by this chapter unless they elect to participate in the optional retirement programs provided pursuant to Chapter 20 of this title.
(B) Existing retirement systems must continue in the manner provided by law for individuals first becoming members before July 1, 2003, and for former members who are reemployed after June 30, 2003, if they so elect.
Section 9-19-40. A member of an existing retirement system on July 1, 2003, in lieu of continued participation in the existing retirement system, may irrevocably elect membership in the plan authorized by this chapter. The administrator of the plan shall notify the existing retirement system of the election and it must, within forty-five days, transfer to the plan administrator a payment equal to the present actuarial value of the member's accrued service benefit on the date of transfer. The amount transferred must be credited to the electing member's individual account.
Section 9-19-50. (A) The plan authorized by this chapter must be established and administered in accordance with the requirements for qualified retirement or eligible deferred compensation plans respectively under the Internal Revenue Code of 1986.
(B) The board shall establish vesting rights in employer contributions in a manner consistent with the requirements of the Internal Revenue Code of 1986 but which afford maximum portability of the member's account.
Section 9-19-60. The board has all powers necessary to effectuate the purposes of this chapter and shall determine and charge reasonable costs of administering the system. The board may contract with a private pension, insurance, annuity, mutual fund, financial institution, or other qualified company or any combination of these entities to administer the day-to-day operation of the plan.
Section 9-19-70. There is established in the state treasury the Public Employees Defined Contribution Retirement Plan Fund, separate and distinct from the general fund and all other funds held in trust on behalf of members but subject to the administrative costs allowed by this chapter.
Section 9-19-80. The plan must include more than one employee-directed investment fund appropriate for investment by public employees and an educational program, approved by the board, that explains to employees considering their elections the probable and possible benefits and risks of the various funds.
Section 9-19-90. The board, or the entity with which it has contracted, in conjunction with the plan, may purchase group annuity contracts, individual retirement annuities, disability insurance investment contracts, securities, mutual funds, interest in trusts, and other financial instruments as necessary or appropriate for the plan to provide retirement and related benefits similar to those provided under an existing retirement system. Selections of plan administrators, annuities, and insurance products must be made pursuant to the provisions of Chapter 35 of Title 11, the South Carolina Consolidated Procurement Code.
Section 9-19-100. The administrator shall prepare, or cause to be prepared, at least quarterly a statement for each member's individual account. The statement must include the current market value of the account, including self-directed investment options, an itemization of changes in the account, the amount vested, and other information required by the board. The administrator shall arrange for an independent audit of the plan's assets unless the audit is provided for by a third party organization."
SECTION 2. This act takes effect July 1, 2003.
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