"An Act relating to the supplemental employee benefit program; relating to teachers' and public employees' defined benefit retirement plans; relating to teachers' and public employees' defined contribution retirement plans; relating to the health reimbursement arrangement plan for certain teachers and public employees; clarifying eligibility for membership in the health reimbursement arrangement plan; relating to waiver of adjustments under the teachers' defined benefit retirement plan and the public employees' defined benefit retirement plan; relating to the administrator of the Public Employees' Retirement System of Alaska; relating to employer contributions for occupational disability and death benefits; repealing participation in the teachers' defined contribution and defined benefit retirement plans by certain employees of the National Education Association of Alaska; relating to requirements for employer minimum contributions to the teachers' and the public employees' defined benefit retirement systems; and relating to the public employees' defined benefit deferred compensation program. "
HB 475 is a clean up bill to the Retirement Security Act (SB 141) that passed in 2005. Due to the length of SB 141, a handful of errors and oversights were made that need to be changed for a smooth transition to Tier IV. HB 475 is a technical bill. It is not intended to include any policy changes.
Revisions encompassed in HB 475:
Clarifies the procedure for an appeal to the Office of Administrative Hearings
Requires employer to contribute at least the normal cost rate starting in 2008
Changes the requirements to receive a conditional service benefit
Clarifies provisions regarding PERS/TRS death and disability benefits, including how those benefits will be funded
Funding death and disability benefits
The structure of death and disability benefits
Clarifies the eligibility requirements for medical benefits
Clarifies requirements for non-vested Tier II or Tier III employees who wish to transfer to Tier IV
Clarifies the basis for calculating employer contribution rates
Gives regulatory authority to the appropriate party
Changes the basis for calculating HRA employer contributions to meet IRS tax qualifications
Disallows employment with NEA as counting towards Tier IV retirement eligibility
Establishes provisions for employer termination of participation in the plan
Clarifies defined benefit and defined contribution components of the plan
Establishes adherence to IRS limitations
The above listed changes are not absolutely necessary for Tier IV to come on line July 1, 2006. However, these revisions clarify many aspects of the statutes, providing a benefit both to the plan and members. If changes are not made, many crucial decisions will be left to the Administrator of the plan without proper guidance from the legislature.