Bill Text: MI SB0026 | 2011-2012 | 96th Legislature | Introduced

Michigan Senate Bill 26 (Prior Session Legislation)

Introduced

Bill Title: Retirement; legislative; retirement health care benefits for legislators; eliminate. Amends secs. 50b, 75 & 79 of 1957 PA 261 (MCL 38.1050b et seq.) & adds sec. 79a.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2011-06-07 - Referred To Committee Of The Whole With Substitute S-1 [SB0026 Detail]

Download: Michigan-2011-SB0026-Introduced.html

SENATE BILL No. 26

January 19, 2011, Introduced by Senator JONES and referred to the Committee on Reforms, Restructuring and Reinventing.

A bill to amend 1957 PA 261, entitled

"Michigan legislative retirement system act,"

by amending sections 50b, 75, and 79 (MCL 38.1050b, 38.1075, and

38.1079), sections 50b and 75 as amended by 1998 PA 501 and section

79 as amended by 2006 PA 614, and by adding section 79a.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 50b. (1) For a retirant or a survivor or beneficiary of a

deceased retirant, or for a deferred vested member if that deferred

vested member first became a member on or before January 1, 1995,

the retirement system shall purchase and pay the premium for

hospitalization and medical insurance coverage and dental and

vision coverage for the retirant, deferred vested member, and the

spouses, eligible children, and survivors of those retirants and

deferred vested members. Except as otherwise provided in this

section, the retirement system shall provide hospitalization and

medical insurance coverage and dental and vision insurance coverage

under this section at a level that is equal to or greater than the

level of insurance coverage under this section in effect on

December 1, 1992. The retirement board may increase the amounts

each person who is enrolled in insurance coverage under this

section is required to pay for co-pays or deductibles under that

insurance coverage.

(2) On and after March 31, 1997, the retirement system shall

also pay health insurance premiums described in this section in the

manner prescribed in section 79 and, on and after January 1, 2011,

in the manner prescribed in section 79 or 79a, whichever is

applicable.

Sec. 75. (1) A qualified participant is immediately 100%

vested in his or her contributions made to Tier 2. A qualified

participant shall vest in the employer contributions made on his or

her behalf to Tier 2 according to the following schedule:

(a) Upon completion of 2 years of service, 50%.

(b) Upon completion of 3 years of service, 75%.

(2) A qualified participant who was first elected to the

legislature or to the position of lieutenant governor before

November 1, 2010 is vested in the health insurance coverage

provided in section 79 if the qualified participant meets 1 of the

following requirements:

(a) The qualified participant has completed 6 years of service

as a qualified participant and was not a member, deferred vested

member, or former nonvested member of Tier 1.

(b) The qualified participant was a member, deferred vested

member, or former nonvested member of Tier 1 who made an election

to participate in Tier 2 pursuant to section 61, and who has met

the service requirements he or she would have been required to meet

in order to vest in health benefits under section 50b.

requirements:

(i) Was not a member, deferred vested member, or former

nonvested member of Tier 1.

(ii) Was first elected to fill a vacancy in the house of

representatives for a period less than the full term but more than

1/2 of the term of office.

(iii) Has completed 5 years of service as a qualified

participant.

Sec. 79. (1) A former qualified participant who was first

elected to the legislature or to the position of lieutenant

governor before November 1, 2010 may elect health insurance

benefits in the manner prescribed in this section if he or she

meets both of the following requirements:

(a) The former qualified participant is vested in health

benefits under section 75(2).

(b) The former qualified participant meets 1 of the following

requirements:

(i) He or she meets or exceeds the benefit commencement age

employed in the actuarial present value calculation under section

62 and the service requirements that would have applied to that

former participant under Tier 1 for receiving health insurance

coverage under section 50b, if that former participant was a member

of Tier 1.

(ii) He or she is 55 years of age or older.

(2) A former qualified participant who is eligible to elect

health insurance coverage under subsection (1) may elect health

insurance coverage in a health benefit plan or plans as authorized

by section 50b. A former qualified participant who is eligible to

elect health insurance coverage under subsection (1) may also elect

health insurance coverage for his or her health benefit dependents,

if any. A surviving health benefit dependent of a deceased former

qualified participant who is eligible to elect health insurance

coverage under subsection (1) may elect health insurance coverage

to begin at the death of the deceased former qualified participant

in the manner prescribed in this section.

(3) An individual who elects health insurance coverage under

this section shall become a member of a health insurance coverage

group authorized pursuant to section 50b.

(4) For a former qualified participant who is eligible to

elect health insurance coverage under subsection (1) and who is

vested in those benefits under section 75(2)(a) or (c), and for his

or her health benefit dependents, this state shall pay a portion of

the health insurance premium as calculated under this subsection on

a cash disbursement method. An individual described in this

subsection who elects health insurance coverage under this section

shall pay to the retirement system the remaining portion of the

health insurance coverage premium not paid by this state under this

subsection. The portion of the health insurance coverage premium

paid by this state under this subsection shall be 90% of the

payments for health insurance coverage under section 50b. If the

individual elects the health insurance coverage provided under

section 50b, this state shall transfer its portion of the amount

calculated under this subsection to the health insurance fund

created by section 22c.

(5) For a former qualified participant who is eligible to

elect health insurance coverage under subsection (1) and who is

vested in those benefits under section 75(2)(b), and for his or her

health benefit dependents, this state shall pay a portion of the

health insurance premium as calculated under this subsection on a

cash disbursement method. An individual described in this

subsection who elects health insurance coverage under this section

shall pay to the retirement system the remaining portion of the

health insurance coverage premium not paid by this state under this

subsection. The portion of the health insurance coverage premium

paid by this state under this subsection shall be equal to the

premium amounts paid on behalf of retirants of Tier 1 for health

insurance coverage under section 50b. If the individual elects the

health insurance coverage provided under section 50b, the state

shall transfer its portion of the amount calculated under this

subsection to the health insurance fund created by section 22c.

(6) If the department of management and budget receives

notification from the United States internal revenue service that

this section or any portion of this section will cause the

retirement system to be disqualified for tax purposes under the

internal revenue code, then the portion that will cause the

disqualification does not apply.

Sec. 79a. (1) A former qualified participant who was first

elected to the legislature or to the position of lieutenant

governor on or after November 1, 2010 may elect health insurance

benefits in the manner prescribed in this section if he or she

meets both of the following requirements:

(a) The former qualified participant is vested in health

benefits under subsection (2).

(b) The former qualified participant is 55 years of age or

older.

(2) A former qualified participant who was first elected to

the legislature or to the position of lieutenant governor on or

after November 1, 2010 is vested in the health insurance coverage

if the former qualified participant has completed 4 years of

service as a qualified participant.

(3) A former qualified participant who is eligible to elect