Bill Text: OR HB3314 | 2013 | Regular Session | Introduced
Bill Title: Relating to health insurance for retired members of Public Employees Retirement System.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2013-07-08 - In committee upon adjournment. [HB3314 Detail]
Download: Oregon-2013-HB3314-Introduced.html
77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1484
House Bill 3314
Sponsored by Representative SPRENGER (at the request of Oregon
School Boards Association)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Eliminates payments toward cost of health insurance premiums
for retired members of Public Employees Retirement System who are
not eligible for Medicare.
Directs Public Employees Retirement Board to enter into
contract to provide health care insurance coverage supplemental
to federal Medicare coverage for eligible persons.
A BILL FOR AN ACT
Relating to health insurance for retired members of Public
Employees Retirement System; creating new provisions; amending
ORS 238.305, 238.410, 238.465, 238.580, 238.585 and 238.660;
and repealing ORS 238.415.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 238.410 is amended to read:
238.410. (1) As used in this section:
(a) 'Carrier' means an insurance company or health care service
contractor holding a valid certificate of authority from the
Director of the Department of Consumer and Business Services, an
insurance company or health care service contractor licensed or
certified in another state that is operating under the laws of
that state, or two or more of those companies or contractors
acting together pursuant to a joint venture, partnership or other
joint means of operation.
(b) 'Eligible person' means { + a person who is eligible for
federal Medicare coverage and who is + }:
(A) A member of the Public Employees Retirement System who is
retired for service or disability and is receiving a retirement
allowance or benefit under the system, and a spouse or dependent
of that member;
(B) A person who is a surviving spouse or dependent of a
deceased retired member of the system or the surviving spouse or
dependent of a member of the system who had not retired but who
had reached earliest retirement age at the time of death;
(C) A person who is receiving retirement pay or a pension
calculated under ORS 1.314 to 1.380 (1989 Edition), and a spouse
or dependent of that person; or
(D) A surviving spouse or dependent of a deceased retired
member of the system or of a person who was receiving retirement
pay or a pension calculated under ORS 1.314 to 1.380 (1989
Edition) if the surviving spouse or dependent was covered at the
time of the decedent's death by a health care insurance plan
contracted for under this section.
(c) 'Health care' means medical, surgical, hospital or any
other remedial care recognized by state law and related services
and supplies and includes comparable benefits for persons who
rely on spiritual means of healing.
(2) The Public Employees Retirement Board shall conduct a
continuing study and investigation of all matters connected with
the providing of health care insurance { - protection - }
{ + coverage supplemental to federal Medicare coverage + } to
eligible persons. The board shall design benefits, devise
specifications, invite proposals, analyze carrier responses to
advertisements for proposals and do acts necessary to award
contracts to provide health care insurance { - , including
insurance that provides - } coverage supplemental to federal
Medicare coverage, with emphasis on features based on health care
cost containment principles, for eligible persons. The board is
not subject to the provisions of ORS chapters 279A and 279B,
except ORS 279B.235, in awarding contracts under the provisions
of this section. The board shall establish procedures for
inviting proposals and awarding contracts under this section.
(3) The board shall enter into a contract with a carrier to
provide health care insurance { + coverage supplemental to
federal Medicare coverage + } for eligible persons for a one or
two-year period. The board may enter into more than one contract
with one or more carriers, contracting jointly or severally, if
in the opinion of the board it is necessary to do so to obtain
maximum coverage at minimum cost and consistent with the health
care insurance needs of eligible persons. The board periodically
shall review a current contract or contracts and make suitable
study and investigation for the purpose of determining whether a
different contract or contracts can and should, in the best
interest of eligible persons, be entered into. If it would be
advantageous to eligible persons to do so, the board shall enter
into a different contract or contracts. Contracts shall be signed
by the chairperson on behalf of the board.
(4) Except as provided in ORS { - 238.415 and - } 238.420,
the board may deduct monthly from the retirement allowance or
benefit, retirement pay or pension payable to an eligible person
who elects to participate in a health care insurance plan the
monthly cost of the coverage for the person under a health care
insurance contract entered into under this section and the
administrative costs incurred by the board under this section,
and shall pay those amounts into the Standard Retiree Health
Insurance Account established under subsection (7) of this
section. The board by rule may establish other procedures for
collecting the monthly cost of the coverage and the
administrative costs incurred by the board under this section if
the board does not deduct those costs from the retirement
allowance or benefit, retirement pay or pension payable to an
eligible person.
(5) Subject to applicable provisions of ORS chapter 183, the
board may make rules not inconsistent with this section to
determine the terms and conditions of eligible person
participation and coverage and otherwise to implement and carry
out the purposes and provisions of this section and ORS 238.420.
(6) The board may retain consultants, brokers or other advisory
personnel, organizations specializing in health care cost
containment or other administrative services when it determines
the necessity and, subject to the State Personnel Relations Law,
shall employ such personnel as are required to assist in
performing the functions of the board under this section.
(7) Pursuant to section 401(h) of the Internal Revenue Code,
the Standard Retiree Health Insurance Account is established
within the Public Employees Retirement Fund, separate and
distinct from the General Fund. All payments made by eligible
persons for health insurance coverage provided under this section
shall be held in the account. Interest earned by the account
shall be credited to the account. All moneys in the account are
continuously appropriated to the Public Employees Retirement
Board and may be used by the board only to pay the cost of health
insurance coverage under this section and to pay the
administrative costs incurred by the board under this section.
(8) The sum of all amounts paid by eligible persons into the
Standard Retiree Health Insurance Account { - , by participating
public employers into the Retiree Health Insurance Premium
Account under ORS 238.415, - } and by participating public
employers into the Retirement Health Insurance Account under ORS
238.420 { - , - } may not exceed 25 percent of the aggregate
contributions made by participating public employers to the
Public Employees Retirement Fund on or after July 11, 1987, not
including contributions made by participating public employers to
fund prior service credits.
(9) Until all liabilities for health benefits under the system
are satisfied, contributions and earnings in the Standard Retiree
Health Insurance Account { - , the Retiree Health Insurance
Premium Account under ORS 238.415 - } and the Retirement Health
Insurance Account under ORS 238.420 may not be diverted or
otherwise put to any use other than providing health benefits and
payment of reasonable costs incurred in administering this
section
{ - and ORS 238.415 - } and { + ORS + } 238.420. Upon
satisfaction of all liabilities for providing health benefits
under this section, any amount remaining in the Standard Retiree
Health Insurance Account shall be returned to the participating
public employers who have made contributions to the account. The
distribution shall be made in such equitable manner as the board
determines appropriate.
SECTION 2. ORS 238.305 is amended to read:
238.305. (1) Not later than 60 days after the first benefit
payment is made to a retired member of the Public Employees
Retirement System, the member may elect to convert the allowance
described by ORS 238.300 as payable after retirement into a
service retirement annuity of equivalent actuarial value of one
of the optional forms named below. The election of Option 2, 2A,
3 or 3A shall be effective immediately upon the member's
retirement.
Option 1. (a) A life annuity (nonrefund) payable during the
member's life only, which shall be the actuarial equivalent of
accumulated contributions by the member and interest thereon
credited at the time of retirement (if death occurs before the
first payment is due, the member account shall be treated as
though death had occurred before retirement); (b) a life pension
(nonrefund) provided by the contributions of employers as
provided in ORS 238.300 (2); (c) an additional nonrefund pension
for prior service credit, including military service, credited to
the member at the time of first becoming a member of the system,
as elsewhere provided in this chapter, which pension shall be
provided by the contributions of the employer; or
Option 2. A reduced service retirement allowance payable during
the member's life, with the provision that it continue after
death for the life of the beneficiary the member nominates by
written designation duly acknowledged and filed with the Public
Employees Retirement Board at the time of election, should the
beneficiary survive the member; or
Option 2A. A reduced service retirement allowance payable
during the member's life which, unless modified under subsection
(6) of this section, continues after death for the life of the
beneficiary the member nominates by written designation duly
acknowledged and filed with the board at the time of election,
should the beneficiary survive the member; or
Option 3. A reduced service retirement allowance payable during
the member's life, with the provision that it continue after
death at one-half the rate paid to the member and be paid for the
life of the beneficiary the member nominates by written
designation duly acknowledged and filed with the board at the
time of election, should the beneficiary survive the member; or
Option 3A. A reduced service retirement allowance payable
during the member's life which, unless modified under subsection
(6) of this section, continues after death at one-half the rate
paid to the member and is paid for the life of the beneficiary
the member nominates by written designation duly acknowledged and
filed with the board at the time of election, should the
beneficiary survive the member; or
Option 4. A reduced service retirement allowance payable during
the member's life, with the provisions that if the member dies
before a total of 180 monthly payments is made, the remainder of
the 180 monthly payments shall be paid monthly to the beneficiary
the member nominates by written designation duly acknowledged and
filed with the board at any time before the member's death; and
that if the member designates no beneficiary to receive the
monthly payments or no such beneficiary is able to receive the
monthly payments, an amount equal to the actuarial value, on the
date of the member's death, of the total of the monthly payments
not made to the member shall be paid according to ORS 238.390 for
disposal of an amount credited to the member account of a member
at the time of death; and that if the beneficiary receiving
monthly payments dies before the total number of monthly payments
to which the beneficiary is entitled is made, an amount equal to
the actuarial value, on the date of the beneficiary's death, of
the total of the monthly payments not made to the member and
beneficiary shall be paid according to ORS 238.390 for disposal
of an amount credited to the member account of a member at the
time of death and as if the beneficiary had been a member.
(2) Not later than 60 days after the first benefit payment is
made to a retired member of the system, the member may elect, in
lieu of the allowance described by ORS 238.300 as payable after
retirement, a service retirement benefit consisting of:
(a) A refund of accumulated contributions by the member and
interest thereon credited at the time of refund; and
(b) A life pension (nonrefund) provided by the contributions of
employers as provided in ORS 237.147 (2) (1979 Replacement Part),
and an additional life pension (nonrefund) for prior service
credit as provided in ORS 238.300 (3). At the same time as making
the election under this subsection, the member may elect to
convert the pensions described by this paragraph into a service
retirement annuity of equivalent actuarial value of one of the
optional forms named as Option 2, 2A, 3 or 3A under subsection
(1) of this section.
(3) Not later than 60 days after the first benefit payment is
made to a retired member of the system, the member may elect in
lieu of the allowance described by ORS 238.300 a refund service
retirement benefit consisting of:
(a) A refund of accumulated contributions by the member and
interest thereon credited at the time of retirement;
(b) An amount that matches the amount of accumulated
contributions by the member and interest thereon, provided by the
contributions of employers; and
(c) Interest on the amounts described in paragraphs (a) and (b)
of this subsection from the effective date of retirement until
the amounts are paid.
(4)(a) If the member elects to receive the service retirement
benefit described in subsection (2) or (3) of this section, the
member shall elect at the same time to receive the refund
described in subsection (2)(a) or (3) of this section in one lump
sum payment or in more than one but not more than five
installment payments. If the member elects installment payments:
(A) The amount to be paid by employer contributions under
subsection (3)(b) of this section shall be transferred to the
individual account of the member in the Public Employees
Retirement Fund as of the effective date of retirement.
(B) The installment payments shall be paid once each year for
the number of consecutive years equal to the number of
installment payments elected.
(C) The amount of each installment payment shall be designated
by the member at the time of making the election, but the last
installment payment shall be the unrefunded balance remaining in
the member account of the member in the fund.
(D) The member account of the member in the fund shall be
maintained until the last installment payment is paid. The board
shall establish procedures for computing and crediting interest
annually on the unrefunded balance of the member account.
(E) A yearly installment payment shall be paid on the
anniversary of the date of the first installment payment.
(F) The member is considered to have elected to transfer any
balance in the variable account of the member to the regular
account of the member.
(G) If the member dies before payment of all installment
payments, the unrefunded balance in the member account of the
member plus interest to date of disbursement is payable as
provided in ORS 238.390 (4).
(b) If a member elects to receive the refund service retirement
benefit described in subsection (3) of this section, and does not
elect to receive those amounts in installments under the
provisions of this subsection, all rights of the member in the
system shall terminate upon the payment of the amounts provided
for in subsection (3) of this section, except as provided in
paragraph (c) of this subsection. If a member elects to receive
the refund service retirement benefit described in subsection (3)
of this section, and also elects to receive those amounts in
installments under the provisions of this subsection, all rights
of the member in the system shall terminate upon the making of
the first payment, except as provided in paragraph (c) of this
subsection.
(c) A member who elects to receive the refund service
retirement benefit described in subsection (3) of this section,
and any eligible spouse or dependent of the member, shall
continue to be eligible for insurance under ORS 238.410, and for
any premium payments the member may be entitled to under ORS
{ - 238.415 and - } 238.420.
(5) The designation of a beneficiary, the election of an option
or any other election or designation under subsection (1), (2),
(3) or (4) of this section may be changed by the member within 60
days after the date of the first benefit payment, except that the
designation of a beneficiary under Option 4 may be changed by the
member at any time before the member's death.
(6) If a retired member has elected to receive a service
retirement allowance under Option 2A or Option 3A as provided in
subsection (1) of this section, and if the beneficiary under that
option dies after the expiration of the time within which the
member could change the election of an option or if the
beneficiary is the spouse of the member and the marriage
relationship is terminated as provided by law after the
expiration of the time within which the member could change the
election of an option, the member may elect to receive, in lieu
of the optional form of allowance previously elected, the
allowance that the member would have received on the effective
date of retirement under Option 1 as provided in subsection (1)
of this section and adjusted by the actual amount of any
cost-of-living or other post-retirement adjustments made to the
original allowance since the effective date of retirement. Notice
of election under this subsection must be in a form approved by
the board. If an election is made under this subsection, the
Option 1 payment amount is applicable to the first full month
after the death of the beneficiary, or the first full month after
entry of the judgment of divorce, and payable the first day of
the month thereafter. If the increased amount is not paid in any
month in which the increased amount is due, the board shall make
a lump sum payment to the retired member that is equal to the
difference between the amount paid to the member for that month
and the amount that should have been paid under the provisions of
this subsection.
(7) Notwithstanding any other provision of this section, any
member of the system who retired before October 3, 1989, and
elected to receive a service retirement allowance under either
Option 2 or 3 as provided in subsection (1) of this section shall
be entitled to receive a service retirement allowance equal to
that which the member would have received on the effective date
of retirement under Option 1 as provided in subsection (1) of
this section and adjusted by the actual amount of any
cost-of-living or other post-retirement adjustments made to the
original allowance since the effective date of retirement if:
(a) The member has attained 80 years of age;
(b) The person designated by the member as the member's
beneficiary has predeceased the member; and
(c) The member gives written notice to the board of the death
of the member's beneficiary.
(8) Notwithstanding any other provision of this section, any
member of the system who retired before October 3, 1989, who
elected to receive a refund of accumulated employee contributions
and a life pension or pensions under subsection (2) of this
section, and who elected to convert the life pension or pensions
provided for in subsection (2) of this section into a service
retirement annuity under Option 2 or 3 under subsection (1) of
this section, shall be entitled to receive a life pension or
pensions equal to that which the member would have received on
the effective date of retirement under subsection (2) of this
section and adjusted by the actual amount of any cost-of-living
or other post-retirement adjustments made to the original life
pension or pensions since the effective date of retirement if:
(a) The member has attained 80 years of age;
(b) The person designated by the member as the member's
beneficiary has predeceased the member; and
(c) The member gives written notice to the board of the death
of the member's beneficiary.
(9) The service retirement allowance provided in subsection (7)
or (8) of this section shall be applicable to the first full
month after the death of the member's beneficiary, or the first
full month after the member attains 80 years of age, whichever is
later.
(10) The board may deny an election to convert a service
retirement allowance under this section, a change of beneficiary
under this section or a change in benefit options under this
section if that denial is required to maintain the status of the
system and the Public Employees Retirement Fund as a qualified
governmental retirement plan and trust under the Internal Revenue
Code and under regulations adopted pursuant to the Internal
Revenue Code.
SECTION 3. ORS 238.465 is amended to read:
238.465. (1) Notwithstanding ORS 238.445 or any other provision
of law, payments under this chapter or ORS chapter 238A of any
pension, annuity, retirement allowance, disability benefit, death
benefit, refund benefit or other benefit that would otherwise be
made to a person entitled thereto under this chapter or ORS
chapter 238A shall be paid, in whole or in part, by the Public
Employees Retirement Board to an alternate payee if and to the
extent expressly provided for in the terms of any judgment of
annulment or dissolution of marriage or of separation, or the
terms of any court order or court-approved property settlement
agreement incident to any judgment of annulment or dissolution of
marriage or of separation. Notwithstanding any other provisions
of this section, the total value of benefits payable to a member
and to an alternate payee under this section may not be greater
than the value of the benefits the member would otherwise be
eligible to receive. Any payment under this subsection to an
alternate payee bars recovery by any other person.
(2) A judgment, order or settlement providing for payment to an
alternate payee under subsection (1) of this section may also
provide:
(a) That payments to the alternate payee may commence, at the
election of the alternate payee, at any time after the earlier
of:
(A) The earliest date the member would be eligible to receive
retirement benefits if the member separates from service; or
(B) The date the member actually separates from service due to
death, disability, retirement or termination of employment.
(b) That the alternate payee may elect to receive payment in
any form of pension, annuity, retirement allowance, disability
benefit, death benefit, refund benefit or other benefit, except a
benefit in the form of a joint and survivor annuity, that would
be available to the member under this chapter or ORS chapter
238A, or that would be available to the member if the member
retired or separated from service at the time of election by the
alternate payee, without regard to the form of benefit elected by
the member.
(c) That the alternate payee's life is the measuring life for
the purpose of measuring payments to the alternate payee under
the form of benefit selected by the alternate payee and for the
purpose of determining necessary employer reserves.
(d) Except as provided in ORS 238.305 (10) and 238.325 (7),
that any person designated by the member as a beneficiary under
ORS 238.300, 238.305, 238.325, 238A.190 or 238A.400 be changed,
even though the member has retired and has begun receiving a
retirement allowance or pension. If a change of beneficiary is
ordered under this paragraph, the board shall adjust the
anticipated benefits that would be payable to the member and the
beneficiary to ensure that the cost to the system of providing
benefits to the member and the new beneficiary does not exceed
the cost that the system would have incurred to provide benefits
to the member and the original beneficiary. The judgment, order
or settlement may not provide for any change to the option
selected by the retired member under ORS 238.300, 238.305,
238.320, 238.325, 238A.190 or 238A.400 as to the form of the
retirement benefit.
(3) The board shall adopt rules that provide for:
(a) The creation of a separate account in the name of the
alternate payee reflecting the judgment's, order's or agreement's
distribution of the member's benefits under this chapter or ORS
chapter 238A;
(b) The establishing of criteria to determine whether domestic
relations judgments, orders and agreements comply with this
section; and
(c) The definitions and procedures for the administration of
this section.
(4) An alternate payee may designate a beneficiary for the
purposes of death benefits payable under ORS 238.390 and 238.395.
Subject to ORS 238A.410 (2), an alternate payee may designate a
beneficiary for the purposes of death benefits payable under ORS
238A.410. If the alternate payee fails to designate a beneficiary
for the purposes of death benefits payable under ORS 238.390 and
238.395, the benefits shall be paid as provided by ORS 238.390
(2). If the alternate payee fails to designate a beneficiary for
the purposes of death benefits payable under ORS 238A.410, the
benefits shall be paid as provided by ORS 238A.410 (3). If a
judgment, order or agreement awards an interest to an alternate
payee, and if the alternate payee predeceases the member before
the alternate payee has commenced receiving benefits, the
alternate payee shall be considered a member of the system who
died before retiring for the purposes of the death benefits
provided in ORS 238.390, 238.395, 238A.230 and 238A.410, but for
purposes of the death benefits provided in ORS 238.395, the
alternate payee shall be considered a member of the system who
died before retiring only if the member would have been eligible
for death benefits under ORS 238.395 had the member died at the
same time as the alternate payee. Payment of the death benefits
to the beneficiaries, estate or other persons entitled to receive
the benefits under ORS 238.390, 238.395, 238A.230 and 238A.410,
shall constitute payment in full of the alternate payee's
interest under the judgment, order or agreement.
(5) Any increase in the retirement allowance provided to the
member shall increase the amounts paid to the spouse or former
spouse of the member in the same proportion, except that an
alternate payee is not entitled to receive cost-of-living
adjustments under ORS 238.360 or any other retirement allowance
increase until benefits are first paid from the system on behalf
of the member.
(6) An alternate payee under this section is not eligible to
receive the benefits provided under ORS 238.410,
{ - 238.415, - } 238.420 and 238.440 by reason of the provisions
of this section.
(7) An alternate payee who elects to begin receiving payments
under subsection (1) of this section before the member's
effective date of retirement is not eligible to receive any
additional payment by reason of credit in the system acquired by
the member after the alternate payee begins to receive payments.
(8) Subsection (1) of this section applies only to payments
made by the board after the date of receipt by the board of
written notice of the judgment, order or agreement and such
additional information and documentation as the board may
prescribe.
(9) Whenever the board is required to make payment to an
alternate payee under the provisions of this section, the board
shall charge and collect out of the benefits payable to the
member and the alternate payee actual and reasonable
administrative expenses and related costs incurred by the board
in obtaining data and making calculations that are necessary by
reason of the provisions of this section. The board may not
charge more than $300 for total administrative expenses and
related costs incurred in obtaining data or making calculations
that are necessary by reason of the provisions of this section.
The board shall allocate expenses and costs charged under the
provisions of this subsection between the member and the
alternate payee based on the fraction of the benefit received by
the member or alternate payee.
(10) Unless otherwise provided by the judgment, order or
agreement, a member has no interest in the benefit payable to an
alternate payee under this section. Upon the death of an
alternate payee, the board shall make such payment to the
beneficiary designated by the alternate payee as may be required
under the form of benefit elected by the alternate payee. If a
death benefit is payable under ORS 238.390 or 238.395 by reason
of the death of an alternate payee, payment of the death benefit
shall be made to the beneficiary designated by the alternate
payee under ORS 238.390 (1), or as otherwise provided by ORS
238.390 and 238.395.
(11) As used in this section, 'court' means any court of
appropriate jurisdiction of this or any other state or of the
District of Columbia.
SECTION 4. ORS 238.580 is amended to read:
238.580. (1) ORS 238.005 (4) and (26), 238.025, 238.078,
238.082, 238.092, 238.115 (1), 238.250, 238.255, 238.260,
238.350, 238.364, 238.410, { - 238.415, - } 238.420, 238.445,
238.458, 238.460, 238.465, 238.475, 238.600, 238.605, 238.610,
238.618, 238.630, 238.635, 238.645, 238.650, 238.655, 238.660,
238.665, 238.670 and 238.705 and the increases provided by ORS
238.366 for members of the system who are serving as other than
police officers or firefighters apply in respect to service as a
judge member.
(2) This chapter applies in respect to persons described in ORS
238.505 (1) and in respect to service as a judge member only as
specifically provided in ORS 238.500 to 238.585.
SECTION 5. ORS 238.585 is amended to read:
238.585. (1) A judge member who has creditable service as other
than a judge member is entitled to the use of all creditable
service as a judge member for the purpose of establishing
eligibility under ORS 238.115, 238.125, 238.135 or any other
provision of this chapter that requires a specified number of
years of creditable service.
(2) A judge member who has creditable service as other than a
judge member is entitled to use of all creditable service as
other than a judge member for the purpose of establishing
eligibility under the provisions of ORS 238.366,
{ - 238.415, - } 238.420 or any other provision of this chapter
that is applicable to a judge member and that requires a
specified number of years of creditable service.
(3) A member of the system other than a judge member who
separates from all service entitling the person to membership in
the system and who withdraws the amount credited to the member
account of the member in the fund may restore all rights
forfeited by the withdrawal in the manner specified by ORS
238.105 if the person becomes a judge member within five years
after the date that the person is separated from all service
entitling the person to membership in the system.
SECTION 6. ORS 238.660 is amended to read:
238.660. (1) The Public Employees Retirement Fund is declared
to be a trust fund, separate and distinct from the General Fund,
for the uses and purposes set forth in this chapter and ORS
chapter 238A and ORS 237.950 to 237.980, and for no other use or
purpose, except that this provision shall not be deemed to amend
or impair the force or effect of any law of this state
specifically authorizing the investment of moneys from the fund.
Interest earned by the fund shall be credited to the fund. Except
as otherwise specifically provided by law, the Public Employees
Retirement Board established by ORS 238.630 is declared to be the
trustee of the fund. Consistent with the legislative intent
expressed in ORS 238.601, and to the extent it is consistent with
the board's fiduciary duties, the board shall give equal
consideration to the interests of participating public employers
and the interests of members. Nothing in this subsection shall be
construed to impose a fiduciary duty on the board to consider the
interests of public employers, and the board shall consider the
interests of public employers only with respect to matters
unrelated to the board's fiduciary duties as trustee of the fund.
(2) Until all liabilities to members and their beneficiaries
are satisfied, assets of the fund may not be diverted or
otherwise put to any use that is not for the exclusive benefit of
members and their beneficiaries. This subsection does not limit
return of employer contributions for health benefits in the
manner provided by ORS 238.410 { - , 238.415 - } and 238.420
upon satisfaction of all liabilities for health benefits under
those sections.
(3) The State of Oregon and other public employers that make
contributions to the fund have no proprietary interest in the
fund or in the contributions made to the fund by them. The state
and other public employers disclaim any right to reclaim those
contributions and waive any right of reclamation they may have in
the fund. This subsection does not prohibit alteration or refund
of employer contributions if the alteration or refund is
authorized under this chapter or ORS chapter 238A and is due to
erroneous payment or decreased liability for employer
contributions under the system. This subsection does not prohibit
the offset of contributions to the individual account program
under ORS 238.229 (5).
(4) The board may accept gifts of money or other property from
any source, given for the uses and purposes of the system. Money
so received shall be paid into the fund. Money or other property
so received shall be used for the purposes for which received.
Unless otherwise prescribed by the source from which the money or
other property is received, the money shall be considered as
income of the fund and the other property shall be retained,
managed and disposed of as are investments of the fund.
(5) All moneys paid into the fund shall be deposited with the
State Treasurer, who shall be custodian of the fund and pay all
warrants drawn on it in compliance with law. No such warrant
shall be paid until the claim for which it is drawn is first
approved by the director or designee and otherwise audited and
verified as required by law. Monthly, each beneficiary's gross
benefit shall be calculated; applicable deductions made for
taxes, insurance and other withholdings; and the net amount paid
to the beneficiary, by check or by electronic funds transfer
(EFT) to the beneficiary's bank. A deduction summary shall be
made, by type, and a check issued for the aggregate of each type
for transmittal to the appropriate taxing jurisdiction, vendor or
institution. A voucher shall be prepared and transmitted to the
Oregon Department of Administrative Services for reimbursement of
the checking account, and the department shall draw a warrant on
the State Treasurer, payable to the Public Employees Retirement
System, for the amount thereof.
(6) Any warrant, check or order for the payment of benefits or
refunds under the system out of the fund issued by the board
which is canceled, declared void or otherwise made unpayable
pursuant to law because it is outstanding and unpaid for a period
of more than two years, may be reissued by the board without bond
if the payee is located after such warrant, check or order is
canceled, declared void or otherwise made unpayable pursuant to
law.
(7) All references in this chapter to checks or warrants are
subject to the provisions of ORS 291.001.
(8) The board shall provide for an annual audit of the
retirement fund and for an annual report to the Legislative
Assembly and to all members of, retirees of, and all employers
participating in, the system. The annual report must contain
financial statements prepared in accordance with generally
accepted accounting principles. The financial statements must
include the report of any independent auditor.
(9) The board may review legislative proposals for changes in
the benefits provided under this chapter and ORS chapter 238A and
may make recommendations to committees of the Legislative
Assembly on those proposed changes. In making recommendations
under this subsection, the board acts as a policy advisor to the
Legislative Assembly and not as a fiduciary. In making
recommendations under this subsection on the Oregon Public
Service Retirement Plan established by ORS chapter 238A, the
board shall seek to maintain the balance between benefits and
costs, and the relative risk borne by employers and employees
with respect to investment performance, reflected in ORS chapter
238A as in effect on January 1, 2004.
(10) The board shall appoint a committee to advise the board on
legislative proposals for changes in the benefits provided under
this chapter and ORS chapter 238A. The committee must have an
equal number of members representing labor and management. No
costs of reviewing legislative proposals and making
recommendations under this subsection may be charged to the fund.
Any member of the committee who is an active member of the system
shall be released by the participating public employer who
employs the member for the purpose of conducting the official
business of the committee, and the wages or salary of the member
may not be reduced by the employer during periods that the member
is released from duty for the purpose of conducting the official
business of the committee.
SECTION 7. { + ORS 238.415 is repealed. + }
SECTION 8. { + After payment of costs of health care insurance
contract coverage and administrative costs incurred by the Public
Employees Retirement Board under ORS 238.415, as in effect
immediately before the effective date of this 2013 Act, amounts
remaining in the Retiree Health Insurance Premium Account shall
be transferred to the Public Employees Retirement Fund and
credited against other liabilities of the employers that made
contributions to the Retiree Health Insurance Premium
Account. + }
SECTION 9. { + The repeal of ORS 238.415 by section 3 of this
2013 Act and the amendments to ORS 238.305, 238.410, 238.465,
238.580, 238.585 and 238.660 by sections 1 to 6 of this 2013 Act
apply only to payments toward the monthly cost of coverage under
a health care insurance contract entered into or renewed under
ORS 238.410 on or after the effective date of this 2013 Act. + }
SECTION 10. { + (1) Jurisdiction is conferred on the Supreme
Court to determine in the manner provided by this section whether
this 2013 Act breaches any contract between members of the Public
Employees Retirement System and their employers or violates any
constitutional provision, including but not limited to impairment
of contract rights of members of the Public Employees Retirement
System under Article I, section 21, of the Oregon Constitution,
or Article I, section 10, clause 1, of the United States
Constitution.
(2) A person who is or who will be adversely affected by this
2013 Act may institute a proceeding for review by filing with the
Supreme Court a petition that meets the following requirements:
(a) The petition must be filed within 60 days after the
effective date of this 2013 Act.
(b) The petition must include the following:
(A) A statement of the basis of the challenge; and
(B) A statement and supporting affidavit showing how the
petitioner is or will be adversely affected.
(3) The petitioner shall serve a copy of the petition by
registered or certified mail upon the Public Employees Retirement
Board, the Attorney General and the Governor.
(4) Proceedings for review under this section shall be given
priority over all other matters before the Supreme Court.
(5) The Supreme Court shall allow public employers
participating in the Public Employees Retirement System to
intervene in any proceeding under this section.
(6) In the event the Supreme Court determines that there are
factual issues in the petition, the Supreme Court may appoint a
special master to hear evidence and to prepare recommended
findings of fact. + }
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