HCS HB 346 & 174 -- PUBLIC SCHOOL RETIREMENT SYSTEMS (Dempsey)

This substitute revises various provisions of the Missouri Public
School Retirement System.

RETIRED TEACHERS AND ADMINISTRATORS

Currently, retired teachers in the St. Louis City school district
may return to teaching for up to four years without loss of
retirement benefits.  The substitute permits retired teachers and
administrators in the Kansas City school district to be employed
by the district for up to four years without loss of benefits.

PUBLIC SCHOOL RETIREMENT SYSTEM

In school districts with 300,000 residents or less, the
substitute:

(1)  Requires the Board of Trustees to determine and certify to
the employers the level rate of contribution and specifies the
time period the rate should be established;

(2)  Requires the level rate of contribution for a fiscal year
not to exceed the rate of contribution for the prior fiscal year
by more than 0.5%;

(3)  Requires the board to determine and certify the level rate
of contribution for a fiscal year based on an actuarial
valuation.  The valuation will be based on an entry age normal
actuarial cost method and an asset valuation method, with the
unfunded actuarial liability amortized over a period not to
exceed 30 years;

(4)  Requires the board to have an actuary conduct an actuarial
valuation of the system and additional valuations at least once
every 10 years;

(5)  Prohibits legislation from being enacted after July 1, 2003,
which provides benefit increases to members and retirees unless
there is a matching contribution rate which equals 10.5% as
determined by an actuarial valuation.  Legislation can be enacted
after July 1, 2003, that provides an extension of time for a
member to make an election for a retirement allowance;

(6)  Allows members who have accrued at least one year of
membership service credit and who have covered employment with
the system following the credit being purchased to purchase
membership service credit or equivalent service credit under
certain terms and conditions.  Payment for the membership service
credit is required prior to termination of membership with the
retirement system;

(7)  Allows a member who has served in the armed forces and who
is no longer in service to purchase membership service credit
equivalent to the period of active duty service;

(8)  Extends the period of a certain retirement allowance
computation provision (Option 1) from July 1, 2003, to July 1,
2008; and

(9)  Allows a member eligible for retirement who has not
previously received a retirement allowance to elect to receive a
partial lump-sum distribution based on an option plan.  This
election is based on years of creditable service and age and is
subject to certain terms and conditions.

GENERAL RETIREMENT PROVISIONS

The substitute:

(1)  Allows members of specified public school retirement systems
who have previous credit in another public school retirement
system to purchase equivalent service credit in their present
retirement system;

(2)  Allows members of specified retirement systems who are
within five years of retirement to purchase additional creditable
service;

(3)  Revises the health insurance benefits provision by allowing
employees one year from the date of last employment to qualify
for the coverage; and

(4)  Contains a provision which allows any school district with a
shortage of certificated teachers to employ retired certificated
teachers for up to two years.  The teachers would not lose
retirement benefits.

NON-TEACHER SCHOOL RETIREMENT SYSTEM

The substitute:

(1)  Requires the Board of Trustees to determine and certify to
the employers the level rate of contribution and specifies the
time period the rate should be established;

(2)  Requires the level rate of contribution for a fiscal year
not to exceed the rate of contribution for the prior fiscal year
by more than 0.25%;

(3)  Requires the board to determine and certify the level rate
of contribution for a fiscal year based on an actuarial
valuation.  The valuation will be based on an entry age normal
actuarial cost method and an asset valuation method, with the
unfunded actuarial liability amortized over a period not to
exceed 30 years;

(4)  Requires the board to have an actuary conduct an actuarial
valuation of the system and additional valuations at least once
every 10 years;

(5)  Prohibits legislation from being enacted after July 1, 2003,
which provides benefit increases to members and retirees unless
there is a matching contribution rate which equals 5% as
determined by an actuarial valuation.  Legislation can be enacted
after July 1, 2003, that provides an extension of time for a
member to make an election for a retirement allowance;

(6)  Requires a member who is reinstated with the retirement
system to effect reinstatement by repaying to the system
accumulated contributions which are withdrawn or refunded prior
to termination with the retirement system;

(7)  Allows members who have accrued at least one year of
membership service credit and who have covered employment with
the system following the credit being purchased to purchase
membership service credit or equivalent service credit under
certain terms and conditions;

(8)  Allows a member who has served in the armed forces and who
is no longer in service to purchase membership service credit
equivalent to the period of active duty service;

(9)  Revises a retirement allowance computation provision; and

(10)  Allows a member eligible for retirement who has not
previously received a retirement allowance to elect to receive a
partial lump-sum distribution based on an option plan.  This
election is based on years of creditable service and age and is
subject to certain terms and conditions.

The substitute contains an emergency clause for certain sections.

FISCAL NOTE:  No impact on state funds.

Missouri House of Representatives
Last Updated July 25, 2003 at 10:11 am