Senate Bill 2398

AN ACT TO AMEND SECTION 25-11-401, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT TEACHING OR ADMINISTRATIVE FACULTY POSITIONS THAT ARE ELIGIBLE FOR THE OPTIONAL RETIREMENT PROGRAM SHALL BE AS DEFINED IN THE PLAN DOCUMENT; TO AMEND SECTION 25-11-409, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT A PARTICIPANT IN THE OPTIONAL RETIREMENT PROGRAM MAY IRREVOCABLY ELECT TO CHANGE HIS OR HER ELECTION AND JOIN THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM BEFORE THE FIFTH ANNUAL ANNIVERSARY OF THE PERSON'S INITIAL ENROLLMENT IN THE OPTIONAL RETIREMENT PROGRAM; TO PROVIDE THAT ANY EMPLOYEE WHO BEFORE JULY 1, 2015, ELECTED TO PARTICIPATE IN THE OPTIONAL RETIREMENT PROGRAM SHALL HAVE A ONE-TIME OPPORTUNITY TO IRREVOCABLY CHANGE HIS OR HER ELECTION AND PROSPECTIVELY PARTICIPATE IN THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM IF THE ELECTION IS FILED WITH THE SYSTEM ON OR BEFORE DECEMBER 31, 2016; TO AUTHORIZE PERSONS MAKING SUCH ELECTION TO PURCHASE SERVICE CREDIT FOR THEIR PRIOR YEARS OF SERVICE DURING WHICH THEY PARTICIPATED IN THE OPTIONAL RETIREMENT PROGRAM; TO AMEND SECTION 25-11-411, MISSISSIPPI CODE OF 1972, TO REMOVE CERTAIN UNNECESSARY LANGUAGE; TO AMEND SECTION 25-11-413, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT, EXCEPT AS OTHERWISE PROVIDED IN THIS ACT, AN EMPLOYEE WHO PARTICIPATES IN THE OPTIONAL RETIREMENT PROGRAM FOR 90 DAYS OR MORE AND IS SUBSEQUENTLY EMPLOYED IN A POSITION THAT IS NOT OTHERWISE ELIGIBLE FOR THE PROGRAM SHALL NOT BE ELIGIBLE FOR PARTICIPATION IN THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM AND SHALL CONTINUE TO BE ELIGIBLE FOR PARTICIPATION IN THE PROGRAM SO LONG AS THE EMPLOYEE MEETS THE OTHER ELIGIBILITY REQUIREMENT FOR THE PROGRAM, EXCEPT AS OTHERWISE PROVIDED IN THIS ACT; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 25-11-401, Mississippi Code of 1972, is amended as follows:

25-11-401. There is established an optional retirement program for employees of the state institutions of higher learning included in Section 37-101-1, Mississippi Code of 1972, who are appointed or employed after July 1, 1990. To be eligible to participate in the optional retirement program, a newly appointed employee must:

(a) (i) Hold a teaching or administrative faculty position * * *, as defined in the plan document; or

(ii) Hold a position as an intern or resident in training at the University Medical Center or the College of Veterinary Medicine at Mississippi State University under a teaching program at such institutions; and

(b) Be eligible for membership in the Public Employees' Retirement System of Mississippi.

SECTION 2. Section 25-11-409, Mississippi Code of 1972, is amended as follows:

25-11-409. (1) Eligible employees initially employed on or after July 1, 1990, shall elect to participate in the optional retirement program within thirty (30) days after (i) entry into state service, or (ii) the effective date of the optional retirement program, whichever is later. The election must be made in writing and filed with the board of trustees and will be effective as of the date of employment. If an eligible employee fails to timely make the election provided in this section, he shall become a member of the Public Employees' Retirement System of Mississippi in accordance with Article 3 of this chapter. Except as otherwise provided in this section, the election to participate in the optional retirement program shall be irrevocable.

(2) (a) A participant in the optional retirement program may irrevocably elect to change his or her election and join the Public Employees' Retirement System before the fifth annual anniversary of the person's initial enrollment in the optional retirement program. Persons electing to join the Public Employees' Retirement System under this paragraph may purchase service credit for their prior years of service at a state institution of higher learning during which they participated in the optional retirement program. The service credit shall be purchased at the actuarial cost and may be purchased by the person making the election by rolling over funds from their optional retirement program account, by rolling over or transferring other plan funds as permitted by the rules set forth in the Internal Revenue Code, or by making an after-tax lump-sum cash payment.

(b) From and after July 1, 2015, and subject to the rules adopted by the board of trustees, any employee who before July 1, 2015, elected to participate in the optional retirement program shall have a one-time opportunity to irrevocably change his or her election and to prospectively participate in the Public Employees' Retirement System. Those who elect to prospectively participate in the Public Employees' Retirement System may purchase service credit for their service with an institution of higher learning during which they participated in the optional retirement program. Service credit shall be purchased at the actuarial cost and the service credit may be purchased by the person making the election by rolling over funds from their optional retirement program account, by rolling over or transferring other program funds as permitted by the rules set forth in the Internal Revenue Code, or by making an after-tax lump-sum cash payment. This one-time election to change from the optional retirement program to the Public Employees' Retirement System shall be filed in writing with the Public Employees' Retirement System on or before December 31, 2016. Those who fail to file the election on or before December 31, 2016, shall not be eligible to participate in this one-time election change.

(c) Service credit purchased under this subsection shall not be recognized as membership service, as defined in Section 25-11-105(r), and it shall not be used to establish eligibility for survivorship or disability retirement benefits.

SECTION 3. Section 25-11-411, Mississippi Code of 1972, is amended as follows:

25-11-411. Each participant shall contribute monthly to the optional retirement program the same amount that he or she would be required to contribute to the Public Employees' Retirement System of Mississippi if he or she were a member of that retirement system. Participant contributions may be made by a reduction in salary in accordance with * * * Section 25-11-124 * * *. The entirety of each participant's contribution shall be remitted to the appropriate company or companies for application to the participant's contracts or accounts, or both. Each employer of a participant in the optional retirement program shall contribute on behalf of each participant in the optional retirement program the same amount the employer would be required to contribute to the Public Employees' Retirement System of Mississippi if the participant were a member of the retirement system. The employer's contribution shall be remitted as follows:

(a) An amount equal to seven and one-fourth percent (7-1/4%) of the participant's total earned compensation as defined in Section 25-11-103 shall be remitted to the appropriate company or companies for application to the participant's contracts or accounts, or both;

(b) An amount equal to two and one-half percent (2-1/2%) of the participant's total earned compensation as defined in Section 25-11-103 shall be remitted to the Public Employees' Retirement System of Mississippi for application to the accrued liability contribution fund;

(c) The remainder, if any, shall be remitted to the appropriate company or companies for application to the participant's contracts or accounts, or both.

If the employer's contribution level is decreased below nine and three-fourths percent (9-3/4%) of the employee's total earned compensation, the remittance provided by paragraph (b) of this section shall be reduced accordingly. There shall be no reduction in the remittance provided by paragraph (a) of this section until such time, if any, that the employer's contribution level is less than seven and one-fourth percent (7-1/4%) of the participant's total earned compensation. If the accrued liability contribution is reduced or discontinued under Section 25-11-123, the amount of the reduction, or the entirety of the employer's contribution, in case of discontinuance, shall be remitted to the appropriate company or companies for application to the participant's contracts or accounts, or both. Any remittance required to be made by the employer to the Public Employees' Retirement System of Mississippi shall be made at the times the employer remits contributions for members of the retirement system.

SECTION 4. Section 25-11-413, Mississippi Code of 1972, is amended as follows:

25-11-413. (1) Except as otherwise provided in Section 25-11-409(2), any person electing to participate in the optional retirement program shall be ineligible for membership in the Public Employees' Retirement System of Mississippi so long as he is employed in a position for which the optional retirement program is available.

(2) Except as otherwise provided in Section 25-11-409(2), in the event that an employee participates in the optional retirement program for ninety (90) days or more and is subsequently employed in a position that is not otherwise eligible for participation in the optional retirement program, the employee shall not be eligible for membership in the Public Employees' Retirement System and shall continue participation in the optional program so long as the employee meets the other eligibility requirements for the optional retirement program.

(3) If an optional retirement program participant assumes a position in state service other than as an employee of a state institution of higher learning, he must at that time begin membership in the Public Employees' Retirement System of Mississippi in accordance with Article 3 of this chapter.

SECTION 5. This act shall take effect and be in force from and after July 1, 2015.