COMMITTEE
HCS HB 1847, 1356, 1593 & 1764 -- CERTAIN RETIREMENT SYSTEMS
SPONSOR: Hagan-Harrell (Skaggs)
COMMITTEE ACTION: Voted "do pass" by the Committee on
Retirement by a vote of 7 to 2.
This substitute makes several changes to both the existing
retirement plan and the Year 2000 Plan of the Missouri State
Employees' Retirement System (MOSERS) and the Highways and
Transportation Employees and Highway Patrol Retirement System
(HTEHPRS), as well as the judicial retirement system.
LIFE INSURANCE
Effective January 1, 2001, the system will provide life
insurance for employees covered by MOSERS, judges, and
administrative judges, and upon the election of the Board of the
Highway and Transportation Employees' and Highway Patrol System,
HTEHPRS employees, in the amount of the rate of annual pay, with
a minimum of $15,000, rather than the current flat $15,000.
This provision applies to both the existing plans and the Year
2000 Plan.
SURVIVING SPOUSE BENEFITS
The 2-year marriage requirement for MOSERS and HTEHPRS is
removed from the surviving spouse benefit for members and
disabled members who die before retirement under the existing
plans. The substitute makes special consultants of surviving
spouses who were married less than 2 years to members who died
before retirement who would otherwise have qualified for such
benefits under the existing plans. Under a current option in
the existing MOSERS plan, a member may elect surviving spouse
benefits if the member has been married for at least one year
before electing the benefit. The substitute removes the one--
year period and requires that such election be made within one
year from the date of marriage. A parallel change is made in
the Year 2000 Plan.
EXISTING PLAN--HIGHWAYS AND TRANSPORTATION EMPLOYEES AND HIGHWAY
PATROL
Retired members may make an election within one year after the
date of marriage to name the new spouse as a beneficiary. Pop--
up benefits will become effective in the month following the
death of the spouse rather than the month following application
for a change in benefit for those who retire on or after July 1,
2000. If a member's death is a result of performance of duty, no
service requirements apply for eligibility for 50% survivor's
benefits. The system will provide death benefits in the form of
life insurance for special consultants pursuant to subsection 4
of Section 104.515, which may be administered by the state
Highways and Transportation Commission; a parallel change is
made in the Year 2000 Plan.
EXISTING PLAN--MOSERS
Employees, administrative law judges, and judges may elect
within one year of subsequent employment in a MOSERS--
administered position to purchase creditable service rather than
within 90 days after a year of such employment. Currently, an
employee in a MOSERS-administered position who had nonfederal
full-time public employment may purchase creditable service.
The substitute adds employees who had provided full-time
services to the state by contract and permits the prior service
to be purchased in any MOSERS-administered plan in which the
employee is receiving credit for active employment or in which
the person is eligible for a deferred annuity. The substitute
permits creditable service under certain conditions for circuit
clerks, deputy circuit clerks, or division clerks for actively
employed members and removes the October 1, 1989, date currently
in statute, substituting August 28, 2000. The substitute
removes the one-year re-employment period for restoration of
forfeited service. For retired members who are elected or
appointed to a state office or enter employment in a position
that requires at least 1,000 hours per year, the one-year
waiting period for counting creditable service is removed and a
method for counting creditable service for calculating
additional annuity amounts is created.
BOTH EXISTING PLANS
The substitute raises the multiplier used for calculating the
annuity for employees covered by MOSERS and HTEHPRS existing
systems from 1.6 to 1.7. The definition of creditable service
clarifies that a day of creditable service cannot exceed one
calendar day of eligible service credit.
YEAR 2000 PLAN
The substitute adds a provision that permits a retiree under the
existing plan who had elected a continuing lifetime annuity for
a surviving spouse or a normal annuity to elect an unreduced
benefit or a life annuity, with the spouse's consent. The
substitute clarifies that calculation of life annuities is based
on full years of credited service and adds provisions permitting
members of the Highway Patrol who are subject to mandatory
retirement to calculate eligibility for the temporary benefit--
leveling annuity based on the mandatory retirement age plus 5
years of credited service. The substitute removes language that
prevents eligibility for the temporary benefit-leveling annuity
when a member is receiving federal Social Security disability
benefits. The substitute clarifies circumstances in which an
active employee may receive additional credited service for
previous public employment.
RETIRED EMPLOYEES' HEALTH INSURANCE
Current law requires a state employee who is entitled to an
annuity, or retirement or disability benefits, to have been
covered for 2 years prior to the date of death, disability, or
retirement in order to be eligible for continued health
insurance. This substitute replaces the 2-year requirement with
coverage dating from the most recent open enrollment period
before the death, disability, or retirement of the member and
reduces the coverage period requirement for spouses and children
from 2 years to 6 months before the member's death, disability,
or retirement of coverage under a separate policy.
JUDICIAL RETIREMENT
Starting September 1, 2000, the substitute permits judges who
retired before August 28, 1995, to become special consultants
who will have their retirement benefits recalculated to
incorporate all annual cost-of-living increases that retired
judges received between any judge's eligibility for retirement
and actual retirement.
The substitute contains an emergency clause.
FISCAL NOTE: Cost to All State Funds of $15,468,026 in FY 2001,
$16,702,498 in FY 2002, and $16,702,498 in FY 2003. Estimated
Net Cost to Highway Fund of $6,487,912 in FY 2001, $7,924,716 in
FY 2002, and $7,928,904 in FY 2003.
PROPONENTS: Supporters say that HB 1847 raises the multiplier
for the existing MOSERS system, making it the same as the
multiplier for the Year 2000 Plan. Current employees who do not
find the Year 2000 Plan attractive because it drops the free 50%
survivor benefit would be able to get the same multiplier as the
Year 2000 Plan and retain the free 50% survivor benefit. HB
1356 picks up a group of approximately 50 judges who were not
included among those who can receive the COLAs that accrue
between eligibility for retirement and actual retirement. HB
1593 corrects an inequitable situation with health benefit
coverage for retired employees. HB 1764 is primarily a clean-up
bill focusing on Highways and Transportation but also affecting
MOSERS. The most significant change in policy is the provision
of additional life insurance for employees based on the annual
rate of pay.
Testifying for the HB 1847 were Representative Hagan-Harrell;
Association of Retired Missouri State Employees; Missouri
Highways and Transportation Employees; Ben Russell; and William
Shaw. Testifying for HB 1356 were Representative Skaggs; and
Missouri Judicial Conference. Testifying for HB 1593 were
Representative Liese; and Missouri Consolidated Health Care
Plan. Testifying for HB 1764 were Representative Gracia Backer;
Highways and Transportation Employees and Highway Patrol
Retirement System; and Missouri Highways and Transportation
Employees.
OPPONENTS: There was no opposition voiced to the committee.
Becky DeNeve, Senior Legislative Analyst
Missouri House of Representatives' Home Page