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S. 357
STATUS INFORMATION
General Bill
Sponsors: Senators Ryberg, Mescher, Bryant, Fair, Verdin, Campsen, Richardson, Ritchie, O'Dell and Gregory
Document Path: l:\council\bills\ggs\22878htc05.doc
Companion/Similar bill(s): 3404
Introduced in the Senate on January 26, 2005
Currently residing in the Senate Committee on Finance
Summary: S.C. Retirement System
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number ------------------------------------------------------------------------------- 1/26/2005 Senate Introduced and read first time SJ-18 1/26/2005 Senate Referred to Committee on Finance SJ-18
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
TO AMEND SECTIONS 9-1-1510, 9-1-1515, 9-1-1550, 9-1-1660, 9-1-1770, AND 9-1-1850, ALL AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO RETIREMENT AND EARLY RETIREMENT, CALCULATION OF RETIREMENT BENEFITS, SURVIVORS' ANNUITIES, DEATH BENEFITS, AND SERVICE PURCHASE FOR PURPOSES OF THE SOUTH CAROLINA RETIREMENT SYSTEM, SO AS TO INCREASE FROM TWENTY-EIGHT TO THIRTY YEARS THE SERVICE CREDIT REQUIRED FOR A MEMBER OF THAT SYSTEM TO RETIRE AT ANY AGE WITHOUT A REDUCTION IN BENEFITS AND TO MAKE THE APPROPRIATE CONFORMING AMENDMENTS.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 9-1-1510(2) of the 1976 Code, as last amended by Act 1 of 2001, is further amended to read:
"(2) attained the age of sixty years or has twenty-eight thirty or more years of creditable service; and"
SECTION 2. Section 9-1-1515 of the 1976 Code, as last amended by Act 1 of 2001, is further amended to read:
"Section 9-1-1515. (A) In addition to other types of retirement provided by this chapter, a member may elect early retirement if the member:
(1) has five or more years of earned service;
(2) has attained the age of fifty-five years;
(3) has at least twenty-five years of creditable service; and
(4) has separated from service.
A member electing early retirement shall apply in the manner provided in Section 9-1-1510.
(B) The benefits for a member electing early retirement under this section must be calculated in the manner provided in Section 9-1-1550, except that in lieu of any other reduction factor, the member's early retirement allowance is reduced by four percent a year, prorated for periods less than one year, for each year of creditable service less than twenty-eight thirty.
(C) A member who elects early retirement under this section is ineligible to receive any cost-of-living increase provided by law to retirees until the second July first after the date the member attains age sixty; or the second July first after the date the member would have twenty-eight thirty years' creditable service had he not retired, whichever is earlier.
(D)(1) Except as provided in item (2) of this subsection, a member who elects early retirement under this section is not covered by the State Insurance Benefits Plan until the earlier of:
(a) the date the member attains age sixty, or
(b) the date the member would have twenty-eight thirty years' creditable service had he not retired.
(2) A member taking early retirement may maintain coverage under the State Insurance Benefits Plan until the date his coverage is reinstated pursuant to item (1) of this subsection by paying the total premium cost, including the employer's contribution, in the manner provided by the Division of Insurance Services of the State Budget and Control Board."
SECTION 3. Section 9-1-1550 of the 1976 Code, as last amended by Act 1 of 2001, is further amended to read:
"Section 9-1-1550. (A) Upon retirement from service on or after July 1, 1964, a Class One member shall receive a service retirement allowance, which shall consist of:
(1) an employee annuity which shall be the actuarial equivalent of his accumulated contributions at the time of his retirement; and
(2) an employer annuity equal to the employee annuity allowable at the age of sixty-five years or at age of retirement, whichever is less, computed on the basis of contributions made prior to the age of sixty-five years; and
(3) if he has a prior service certificate in full force and effect, an additional employer annuity which must be equal to the employee annuity which would have been provided at age sixty-five or at age of retirement, whichever is less, by twice the contributions which he would have made during his entire period of prior service had the system been in operation and had he contributed thereunder during such entire period.
Upon retirement from service after December 31, 2000 June 30, 2005, a Class One member shall receive a service retirement allowance computed as follows: If the member's service retirement date occurs on or after his sixty-fifth birthday, or after he has completed twenty-eight thirty or more years of creditable service, the allowance must be equal to one and forty-five hundredths percent of his average final compensation multiplied by the number of years of his creditable service.
If the member's service retirement date occurs before his sixty-fifth birthday and before he completes twenty-eight thirty years of creditable service, his service retirement allowance is computed as above, but is reduced by five-twelfths of one percent thereof for each month by which his retirement date precedes the first day of the month, prorated for periods less than a month, coincident with or next following his sixty-fifth birthday.
Notwithstanding the foregoing provisions, any Class One member who retires on or after July 1, 1976, shall receive not less than the benefit provided under the formula in effect before July 1, 1976.
(B) Upon retirement from service after December 31, 2000 June 30, 2005, a Class Two member shall receive a service retirement allowance computed as follows:
(1) If the member's service retirement date occurs on or after his sixty-fifth birthday or after he has completed twenty-eight thirty or more years of creditable service, the allowance must be equal to one and eighty-two hundredths percent of his average final compensation, multiplied by the number of years of his creditable service.
(2) If the member's service retirement date occurs before his sixty-fifth birthday and before he completes the twenty-eight thirty years of creditable service, his service retirement allowance is computed as in item (1) above but is reduced by five-twelfths of one percent thereof for each month, prorated for periods less than a month, by which his retirement date precedes the first day of the month coincident with or next following his sixty-fifth birthday.
(3) Notwithstanding the foregoing provisions, a Class Two member whose creditable service began before July 1, 1964, shall receive not less than the benefit provided by subsection (A) of this section."
SECTION 4. Section 9-1-1660(A)(3) of the 1976 Code, as last amended by Act 387 of 2000, is further amended to read:
"(3) has either attained the age of sixty years or has accumulated fifteen years or more of creditable service, elect to receive in lieu of the accumulated contributions an allowance for life in the same amount as if the deceased member had retired at the time of the member's death and had named the person as beneficiary under an election of Option B of Section 9-1-1620(A). For purposes of the benefit calculation, a member under age sixty with less than twenty-eight thirty years' credit is assumed to be sixty years of age."
SECTION 5. Section 9-1-1770 of the 1976 Code, as last amended by Act 1 of 2001, is further amended to read:
"Section 9-1-1770. Effective July 1, 1968, there shall be created the Preretirement Death Benefit Program, which shall be effective as of that date to all employers under the System except counties, municipalities and other political subdivisions, as well as those State departments, agencies or other institutions which pay directly to the System the total employer contributions for the participating members in their employ.
The Program shall be available to those employers exempted in the preceding paragraph by written application of such employer. Applications shall be an irrevocable commitment to participate under the Program. For applications received by the System prior to October 1, 1968, the effective date of the coverage shall be July 1, 1968. For all other applications the effective date shall be July first next following the date of receipt by the System of the application.
Upon receipt of proof, satisfactory to the board, of the death of a contributing member in service who had completed at least one full year of membership in the System or of the death of a contributing member as a result of an injury arising out of and in the course of the performance of his duties regardless of length of membership, as of the effective date of his employer's participation, there must be paid to the person he nominated for the refund of his accumulated contributions, unless he has nominated a different beneficiary by written designation filed with the board, in the event of his death pursuant to Section 9-1-1650, if the person is living at the time of the member's death, otherwise to the member's estate, a death benefit equal to the annual earnable compensation of the member at the time his death occurs. The death benefit is payable apart and separate from the payment of the member's accumulated contributions on his death pursuant to Sections 9-1-1650 or 9-1-1660. For purposes of this section, a member is considered to be in service at the date of his death if the last day the member was employed in a continuous, regular pay status, while earning regular or unreduced wages and regular or unreduced retirement service credit, whether the member was physically working on that day or taking continuous accrued annual leave or sick leave while receiving a full salary, occurred not more than ninety days before the date of his death and he has not retired.
The Board is authorized to take such action as may be necessary to provide the death benefit under this section in the form of group life insurance upon a determination that to do so would guarantee a more favorable tax treatment of the benefit to beneficiaries to whom such benefit is payable.
Upon the death of a retired member after December 31, 2000 June 30, 2005, there must be paid to the designated beneficiary or beneficiaries, if living at the time of the retired member's death, otherwise to the retired member's estate, a life insurance benefit of one two thousand dollars if the retired member had ten years of creditable service but less than twenty years, two four thousand dollars if the retired member had twenty years of creditable service but less than twenty-eight thirty, and three six thousand dollars if the retired member had at least twenty-eight thirty years of creditable service at the time of retirement, provided the retired member's most recent employer prior to retirement is covered by the Group Life Insurance Program.
Upon the death of a retired member after June 30, 2000, the life insurance benefit otherwise due the member's beneficiary, beneficiaries, or estate under the above paragraph is increased as follows: one thousand dollars is increased to two thousand dollars; two thousand dollars is increased to four thousand dollars; and three thousand dollars is increased to six thousand dollars."
SECTION 6. Section 9-1-1850 of the 1976 Code, as last amended by Act 1 of 2001, is further amended to read:
"Section 9-1-1850. A member who has at least twenty-five years of creditable service may elect to receive up to three five years of additional service credit as though the additional service credit were rendered by the member as an employee or member upon paying into the member's retirement system, during the ensuing number of years the member wishes to purchase in the manner the Comptroller General shall direct, the employer and employee contributions that would be due for the position that the member presently holds at the salary level in effect during those years. If the position is consolidated or eliminated after the member's retirement, the member shall pay the employer and employee contributions during the remaining required years at a level equal to what these contributions were for the position before its consolidation or elimination. The member also shall pay the employer and employee cost for health and dental insurance in effect during the ensuing years the member wishes to purchase. The additional service credit qualifies the member for retirement and the member must terminate employment within ninety days after electing the option provided by this section. The salary level of the position the member presently holds, during the ensuing years the member pays the employer and employee contributions, is attributable to the member for purposes of determining the member's average final compensation.
The retirement benefits of the member shall not commence until the time benefits would have been paid when the member had completed twenty-eight thirty years of service.
The option allowed by this section cannot be exercised if the member has purchased nonqualified service pursuant to Section 9-1-1140(E)."
SECTION 7. This act takes effect upon approval by the Governor and applies with respect to applications for retirement filed with the South Carolina Retirement System after June 30, 2005, and in the case of Section 9-1-1770 of the 1976 Code, as amended in this act, for retired members of the South Carolina Retirement System dying after June 30, 2005.
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