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2001 SESSION

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HB 2293 Retirement System; purchase of prior service credit, sick leave.

Introduced by: M. Kirkland Cox | all patrons    ...    notes | add to my profiles | history

SUMMARY AS PASSED:

Virginia Retirement System; purchase of prior service credit. Makes several changes to the current law concerning the purchase of prior service credit including technical amendments. The purchase of retirement credit for prior military service is permitted even when the prior military service is creditable to another retirement system, if such is required by federal statutes governing military retirement. The bill also provides that if a person becomes a member of the retirement system on or after July 1, 2001, and elects to purchase prior service within three years from his first date of hire, he must pay an amount equal to five percent of his present annual compensation or five percent of his average annual compensation during his 36 highest consecutive months of creditable service, whichever is greater. At any other time, such member must pay an amount equal to actuarial equivalent cost. Members in service immediately before July 1, 2001, have three years from the date they first became eligible to purchase the prior service (generally their date of hire) or until July 1, 2004, (whichever is later) to purchase such service at the reduced rate. If the member does not purchase the prior service within this time period, the cost to the member to purchase the service shall be the actuarial cost. The bill also provides for the purchase of prior service by members for periods of employment in an hourly wage position with the Commonwealth. In general, only four years of prior service credit may be purchased for each eligible category of prior service. Current law provides that any years of eligible prior service, beyond four years, may be purchased at a cost of 15 percent of a member's present annual compensation. This bill is identical to SB 1077.

SUMMARY AS PASSED HOUSE:

Virginia Retirement System; purchase of prior service credit. Makes several changes to the current law concerning the purchase of prior service credit including technical amendments. The purchase of retirement credit for prior military service is permitted even when the prior military service is creditable to another retirement system, if such is required by federal statutes governing military retirement. The bill also provides that if a person becomes a member of the retirement system on or after July 1, 2001, and elects to purchase prior service within three years from his first date of hire, he must pay an amount equal to five percent of his present annual compensation or five percent of his average annual compensation during his 36 highest consecutive months of creditable service, whichever is greater. At any other time, such member must pay an amount equal to actuarial equivalent cost. Members in service immediately before July 1, 2001, have three years from the date they first became eligible to purchase the prior service (generally their date of hire) or until July 1, 2004, (whichever is later) to purchase such service at the reduced rate. If the member does not purchase the prior service within this time period, the cost to the member to purchase the service shall be the actuarial cost. The bill also provides for the purchase of prior service by member for periods of employment in a fill time hourly wage position with the Commonwealth prior to July 1, 1988. In general, only four years of prior service credit may be purchased for each eligible category of prior service. Current law provides that any years of eligible prior service, beyond four years, may be purchased at a cost of 15 percent of a member's present annual compensation.

SUMMARY AS INTRODUCED:

Virginia Retirement System; purchase of prior service credit. Makes several changes to the current law concerning the purchase of prior service credit including technical amendments. The purchase of retirement credit for prior military service is permitted even when the prior military service is creditable to another retirement system, if such is required by federal statutes governing military retirement. The bill also provides that if a person becomes a member of the retirement system on or after July 1, 2001, and elects to purchase prior service within three years from the date of his hire, he must pay an amount equal to five percent of his present annual compensation or five percent of his average annual compensation during his 36 highest consecutive months of creditable service, whichever is greater. At any other time, such member must pay an amount equal to actuarial equivalent cost.

Members in service immediately before July 1, 2001, have three years from the date they first became eligible to purchase the prior service (generally their date of hire) or until July 1, 2002, (whichever is later) to purchase such service at the reduced rate. If the member does not purchase the prior service within this time period, the cost to the member to purchase the service shall be the actuarial cost.

In general, only four years of prior service credit may be purchased for each eligible category of prior service. Current law provides that any years of eligible prior service, beyond four years, may be purchased at a cost of 15 percent of a member's present annual compensation.