Bill Text: NJ S751 | 2010-2011 | Regular Session | Introduced
Bill Title: Offers surviving spouse of TPAF or PERS member with 25 or more years of service choice of deferred pension instead of current return of contributions and non-contributory life insurance.
Sponsorship: Partisan Bill (Republican 1)
Status: (Introduced - Dead) 2010-01-12 - Introduced in the Senate, Referred to Senate State Government, Wagering, Tourism & Historic Preservation Committee [S751 Detail]
Download: New_Jersey-2010-S751-Introduced.html
STATE OF NEW JERSEY
214th LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2010 SESSION
Sponsored by:
Senator JENNIFER BECK
District 12 (Mercer and Monmouth)
SYNOPSIS
Offers surviving spouse of TPAF or PERS member with 25 or more years of service choice of deferred pension instead of current return of contributions and non-contributory life insurance.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel
An Act concerning the death benefit of certain members of the Teachers' Pension and Annuity Fund and the Public Employees' Retirement System and amending N.J.S.18A:66-38 and P.L.1954, c.84.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. N.J.S.18A:66-38 is amended to read as follows:
18A:66-38. Upon the receipt of proper proofs of the death of a member in service on account of which no accidental death benefit is payable under section 18A:66-46, there shall be paid to such member's beneficiary:
(a) The member's accumulated deductions at the time of death together with regular interest after January 1, 1956; and
(b) An amount equal to 1 1/2 times the compensation upon which contributions by the member to the annuity savings fund were based in the last year of creditable service; or
(c) if the member dies after accruing 25 or more years of service credit and has designated his or her spouse as sole beneficiary, the surviving spouse shall have the option of choosing between the benefit provided in paragraphs (a) and (b) or the retirement allowance that the surviving spouse would have been entitled to receive if the member had retired on the date of the member's death and had selected Option 2 pursuant to N.J.S.18A:66-47. The surviving spouse's retirement allowance shall commence on the date the member would have attained service retirement age or, if the member had attained service retirement age, on the date of the member's death. However, if the surviving spouse chooses to receive the retirement allowance prior to the time at which the member would have attained service retirement age, the retirement allowance shall be reduced by 1/4 of 1% for each month that the member was under service retirement age at the time of the member's death.
For the purpose of this section, section 18A:66-46e and section 18A:66-53, a member of the retirement system shall be deemed to be an active member (1) while he is disabled due to sickness or injury arising out of or in the course of his employment as a teacher to whom this article applies, is not engaged in any gainful occupation, and is receiving or entitled to receive periodic benefits (including any commutation of, or substitute for, such benefits) for loss of time on account of such disability under or by reason of workmen's compensation law, occupational disease law or similar legislation and has not retired or terminated his membership; or (2) for a period of no more than two years while on official leave of absence without pay if satisfactory evidence is presented to the retirement system that such leave of absence without pay is due to the member's personal illness other than an illness to which (1) above applies. For the purpose of this section, section 18A:66-46e and section 18A:66-53, a member of the retirement system shall be deemed to be an active member for a period of not more than one year in the event of an official leave (1) due to the member's maternity or (2) to fulfill a residency requirement for an advanced degree or (3) as a full-time student at an institution of higher education, and for a period of not more than 93 days while on official leave of absence without pay when such leave of absence is due to any reason other than illness. In order for a member to be covered for the optional death benefits provided by section 18A:66-53, he shall continue to make contributions for same during the period such member is on official leave of absence without pay, except that when such official leave of absence without pay is due to illness, no contributions shall be required of the member during the period he is deemed to be an active member while on such leave of absence.
If a member dies within 30 days after the date of retirement or the date of board approval, whichever is later, a death benefit shall be payable only if he is deemed to be an active member in accordance with this section; provided, however, a member applying for disability benefits shall be deemed an active member if he was covered by the death benefit provisions of the act at the termination of employment, filed the application for disability retirement with the retirement system within 30 days following such termination of employment and dies within 30 days after the date of retirement or the date of board approval, whichever is later.
(cf: P.L.1984, c.132, s.1)
2. Section 41 of P.L.1954, c.84 (C.43:15A-41) is amended to read as follows:
41. a. A member who withdraws from service or ceases to be an employee for any cause other than death or retirement shall, upon the filing of an application therefor, receive all of his accumulated deductions standing to the credit of his individual account in the annuity savings fund, plus regular interest, less any outstanding loan, except that for any period after June 30, 1944, the interest payable shall be such proportion of the interest determined at the regular rate of 2% per annum bears to the regular rate of interest, and except that no interest shall be payable in the case of a member who has less than three years of membership credit for which he has made contributions. He shall cease to be a member two years from the date he discontinued service as an eligible employee, or, if prior thereto, upon payment to him of his accumulated deductions. If any such person or member shall die before withdrawing or before endorsing the check constituting the return of his accumulated deductions, such deductions shall be paid to the member's beneficiary. No member shall be entitled to withdraw the amounts contributed by his employer covering his military leave unless he shall have returned to the payroll and contributed to the retirement system for a period of 90 days.
b. Should a member resign after having established 25 years of creditable service before reaching age 60, or before reaching age 62 if the person became a member of the retirement system on or after the effective date of P.L.2008, c.89, he may elect "early retirement," provided, that such election is communicated by such member to the retirement system by filing a written application, duly attested, stating at what time subsequent to the execution and filing thereof he desires to be retired. He shall receive, in lieu of the payment provided in subsection a. of this section, an annuity which is the actuarial equivalent of his accumulated deductions together with regular interest, and a pension in the amount which, when added to the member's annuity, will provide a total retirement allowance of 1/64 of his final compensation for each year of service credited as Class A service and 1/55 of his final compensation for each year of service credited as Class B service, calculated in accordance with section 48 (C.43:15A-48) of this act, reduced:
(a) by 1/4 of 1% for each month that the member lacks of being age 55; or
(b) for a person who becomes a member of the retirement system on or after July 1, 2007, by 1/4 of 1% for each month that the member lacks of being age 55 and by 1/12 of 1% for each month that the member lacks of being age 60 but over age 55; or
(c) for a person who becomes a member of the retirement system on or after the effective date of P.L.2008, c.89, by 1/4 of 1% for each month that the member lacks of being age 55 and by 1/12 of 1% for each month that the member lacks of being age 62 but over age 55; provided, however, that upon the receipt of proper proofs of the death of such a member there shall be paid to his beneficiary an amount equal to three-sixteenths of the compensation upon which contributions by the member to the annuity savings fund were based in the last year of creditable service.
Paragraph (b) or (c) of this subsection shall not apply to a person who at the time of enrollment in the retirement system on or after July 1, 2007 transfers service credit from another State-administered retirement system pursuant to section 14 of P.L.1954, c.84 (C.43:15A-14), but shall apply to a former member of the retirement system who has been granted a retirement allowance and is reenrolled in the retirement system on or after July 1, 2007 pursuant to section 27 of P.L.1966, c.217 (C.43:15A-57.2) after becoming employed again in a position that makes the person eligible to be a member of the retirement system.
The board of trustees shall retire him at the time specified or at such other time within one month after the date so specified as the board finds advisable.
c. Upon the receipt of proper proofs of the death of a member in service on account of which no accidental death benefit is payable under section 49 there shall be paid to such member's beneficiary:
(1) The member's accumulated deductions at the time of death together with regular interest; and
(2) An amount equal to one and one-half times the compensation upon which contributions by the member to the annuity savings fund were based in the last year of creditable service; or
(3) if the member dies after accruing 25 or more years of service credit and has designated his or her spouse as sole beneficiary, the surviving spouse shall have the option of choosing between the benefit provided in paragraphs (1) and (2) or the retirement allowance that the surviving spouse would have been entitled to receive if the member had retired on the date of the member's death and had selected Option 2 pursuant to section 50 of P.L.1954, c.84 (C.43:15A-50). The surviving spouse's retirement allowance shall commence on the date the member would have attained service retirement age or, if the member had attained service retirement age, on the date of the member's death. However, if the surviving spouse chooses to receive the retirement allowance prior to the time at which the member would have attained service retirement age, the retirement allowance shall be reduced by 1/4 of 1% for each month that the member was under service retirement age at the time of the member's death.
(cf: P.L.2008, c.89, s.23)
3. a. If a member of the Teachers' Pension and Annuity Fund died after January 1, 2008, after accruing 25 or more years of service credit, and designated his or her spouse as sole beneficiary, the surviving spouse shall have the option of applying for the retirement allowance that the surviving spouse would have been entitled to receive if the member had retired on the date of the member's death and had selected Option 2 pursuant to N.J.S.18A:66-47, if, on or before the 60th day following the member's date of death or the effective date of this act, whichever is later, the surviving spouse makes that request in writing to the board of trustees of the fund and returns the amount received under paragraph (a) of N.J.S.18A:66-38 together with regular interest and the amount of the benefit received under paragraph (b) of N.J.S.18A:66-38. Upon approval by the board, the request shall become irrevocable and the surviving spouse's retirement allowance shall commence at the time the member would have attained service retirement age.
b. If a member of the Public Employees' Retirement System died after January 1, 2008, after accruing 25 or more years of service credit, and designated his or her spouse as sole beneficiary, the surviving spouse shall have the option of applying for the retirement allowance that the surviving spouse would have been entitled to receive if the member had retired on the date of the member's death and had selected Option 2 pursuant to section 50 of P.L.1954, c.84 (C.43:15A-50), if, on or before the 60th day following the member's date of death or the effective date of this act, whichever is later, the surviving spouse makes that request in writing to the board of trustees of the retirement system and returns the amount received under paragraph (a) of N.J.S.18A:66-38 together with regular interest and the amount of the benefit received under paragraph (b) of N.J.S.18A:66-38. Upon approval by the board, the request shall become irrevocable and the surviving spouse's retirement allowance shall commence at the time the member would have attained service retirement age.
4. This act shall take effect immediately.
STATEMENT
This bill provides that if an active member of the Teachers' Pension and Annuity Fund (TPAF) or the Public Employees' Retirement System (PERS) dies after accruing 25 or more years of service and has designated his or her spouse as sole beneficiary, the surviving spouse will have the option of choosing between the current benefit of a return of the member's accumulated deductions plus interest and an amount equal to one and one-half times the member's compensation, or the retirement allowance that the surviving spouse would have been entitled to receive if the member had retired on the date of the member's death and had selected the option entitling the surviving spouse to receive a retirement allowance in an amount equal to the member's reduced retirement allowance. The surviving spouse's retirement allowance will begin at the time the member would have attained service retirement age or, if the member had attained service retirement age, on the date of the member's death. However, if the surviving spouse chooses to receive the retirement allowance prior to the time at which the member would have attained service retirement age, the retirement allowance will be reduced by 1/4 of 1% for each month that the member was under service retirement age at the time of his or her death.
The bill also provides that if a TPAF or PERS member died after January 1, 2008, after accruing 25 or more years of service credit, and designated his or her spouse as sole beneficiary, the surviving spouse will have the option of applying for the retirement allowance that the surviving spouse would have been entitled to receive if the member had retired on the date of the member's death and had selected the option entitling the surviving spouse to receive a retirement allowance in an amount equal to the member's reduced retirement allowance, if, on or before the 60th day following the member's date of death or the effective date of the bill, whichever is later, the surviving spouse makes that request in writing to the appropriate board of trustees and returns the amounts of the member's contributions and non-contributory life insurance already received. Upon approval by the board, the request shall become irrevocable and the surviving spouse's retirement allowance will commence at the time the member would have attained service retirement age or, if the member had attained service retirement age, on the date of the member's death.
