House Bill No. 216
Introduced By hibbard, crippen, simpkins, bartlett, denny, hagener, hertel, wiseman, devlin, wilson, sands, jergeson, quilici
A Bill for an Act entitled: An Act reducing the years required for vesting in the sheriffs' retirement system; increasing the service retirement, disability, and death benefit; increasing member and employer contributions; repealing the involuntary retirement benefit; superseding the unfunded mandate law; amending sections 19-7-301, 19-7-403, 19-7-404, 19-7-502, 19-7-503, and 19-7-901, MCA; repealing section 19-7-504, MCA; and providing an effective date.
Be it enacted by the Legislature of the State of Montana:
Section 1. Section 19-7-301, MCA, is amended to read:
"19-7-301. Membership -- inactive vested members -- inactive nonvested members. (1)
Every Each sheriff is required
to become a member of the sheriffs' retirement system unless the sheriff was a member of the public employees' retirement
system on July 1, 1974, in which case the sheriff may at the sheriff's option become a member of the sheriffs' retirement
(2) An investigator is required to become a member of the sheriffs' retirement system unless the investigator was a member of the public employees' retirement system on July 1, 1993, in which case the investigator has the option of becoming a member of the sheriffs' retirement system.
(3) All sheriffs and investigators who become members of the sheriffs' retirement system
must shall remain members so
long as they are actively employed in an eligible capacity, except as provided in 19-7-1101.
(4) A member with at least
15 5 years of membership service who terminates service and does not take a refund of the
member's accumulated contributions is an inactive vested member and retains the right to purchase service and to receive a
retirement benefit under the provisions of this chapter.
(5) A member with less than
15 5 years of membership service who terminates service and leaves the member's
accumulated contributions in the pension trust fund is an inactive nonvested member and is not eligible for any benefits
from the retirement system. An inactive nonvested member is eligible only for a refund of the member's accumulated
Section 2. Section 19-7-403, MCA, is amended to read:
"19-7-403. Member's contributions deducted. (1)
Every Each member shall contribute into the pension trust fund
7.865% 9.245% of the member's monthly compensation, which must be deposited to the member's credit in the pension
(2) Each employer, pursuant to section 414(h)(2) of the federal Internal Revenue Code of 1954, as amended and applicable on July 1, 1985, shall pick up and pay the contributions that would be payable by the member under subsection (1) for service rendered after June 30, 1985.
(3) The member's contributions picked up by the employer must be designated for all purposes of the retirement system as the member's contributions, except for the determination of a tax upon a distribution from the retirement system. These contributions must become part of the member's accumulated contributions but must be accounted for separately from those previously accumulated.
(4) The member's contributions picked up by the employer must be payable from the same source as is used to pay compensation to the member and must be included in the member's wages, as defined in 19-1-102, and salary as used to define the member's final average salary in 19-7-101. The employer shall deduct from the member's compensation an amount equal to the amount of the member's contributions picked up by the employer and remit the total of the contributions to the board."
Section 3. Section 19-7-404, MCA, is amended to read:
"19-7-404. Employer contributions. (1) The employer shall pay monthly
8.535% 9.535% of each member's gross
compensation into the pension trust fund created by this chapter.
(2) If the required contribution to the retirement system exceeds the funds available to a county from general revenue sources, a county may budget, levy, and collect annually a special tax on the assessable property within the county that is sufficient to raise the amount of revenue needed to meet the county's obligation. This tax may be in addition to the annual rate of taxation allowed by law to be levied by the county."
Section 4. Section 19-7-502, MCA, is amended to read:
"19-7-502. Early retirement option. A member with
15 at least 5 years of membership service and who has not met the
minimum eligibility requirements for service retirement may retire with an early retirement benefit commencing no sooner
than the first day of the month following the member's 50th birthday. The early retirement benefit must be calculated to be
the actuarial equivalent of the member's retirement benefit as otherwise accrued, based upon payment commencing when
the member would have completed 20 years of membership service or reached age 60, whichever event would have
Section 5. Section 19-7-503, MCA, is amended to read:
"19-7-503. Service retirement benefit. (1) The amount of any service retirement benefit granted to a member is
2.5% of the member's final average salary for each year of service credit.
(2) If a member dies after retirement and had not elected an optional retirement benefit provided for in 19-7-1001, the member's designated beneficiary must be paid the excess, if any, of the member's accumulated contributions at the time of retirement less payments made to the retired member."
Section 6. Section 19-7-901, MCA, is amended to read:
"19-7-901. Payments in case of death before retirement. If a member dies before retirement, the member's designated beneficiary may elect one of the following options for which the member qualified and the designated beneficiary qualifies:
(1) a lump-sum payment of the accumulated contributions standing to the member's credit at the member's death;
(2) a survivorship benefit equal to
2.0834% 2.5% of the member's final average salary for each year of service credit
actuarially reduced from age 65 or the date on which the member would have completed 20 years of membership service,
whichever provides a larger retirement benefit; or
(3) a survivorship benefit that is no less than one-half of the member's final average salary if the board finds that the member died as a direct and proximate result of injuries received in the course of employment."
Section 7. Unfunded mandate law superseded. The provisions of [this act] expressly supersede and modify the requirements of 1-2-112 through 1-2-116.
Section 8. Repealer. Section 19-7-504, MCA, is repealed.
Section 9. Effective date. [This act] is effective July 1, 1997.