As Reported by the House Health, Retirement and Aging Committee 1
122nd General Assembly 4
Regular Session Am. H. B. No. 339 5
1997-1998 6
REPRESENTATIVES VESPER-TIBERI-PADGETT-CORBIN-BENDER-MOTTLEY- 8
LUCAS-OPFER-COLONNA-TERWILLEGER-MALLORY-HAINES-BRITTON- 9
BRADING-MAIER-TAYLOR-WESTON-PATTON-SCHURING-VAN VYVEN-TAVARES 10
12
A B I L L
To amend sections 3307.38 and 3307.384 and to enact 14
section 3307.4013 of the Revised Code to increase 15
benefits under the State Teachers Retirement 17
System. 18
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 20
Section 1. That sections 3307.38 and 3307.384 be amended 21
and section 3307.4013 of the Revised Code be enacted to read as 22
follows:
Sec. 3307.38. Any member who has five years of service 24
credit and has attained age sixty, or who has twenty-five years 25
of service credit and has attained age fifty-five, or who has 26
thirty years of service credit shall be granted service 27
retirement after filing with the state teachers retirement board 28
a completed application on a form approved by the board. 29
(A) Service retirement shall be effective on the first day 31
of the month next following the later of: 32
(1) The last day for which compensation was paid; or 34
(2) The attainment of minimum age or service credit 36
eligibility for benefits provided under this section. 37
Except as otherwise provided in division (D) of this 39
section, the service retirement benefit shall be the greater of 40
the benefits provided in divisions (B) and (C) of this section. 41
(B)(1) Subject to any adjustment made under division 43
(B)(2) of this section, the annual single lifetime benefit of a 45
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member shall be the greater of the amounts determined by his THE
MEMBER'S Ohio service credit multiplied by one of the following: 47
(a) Eighty-six dollars; 49
(b) Two and one-tenth per cent of his THE MEMBER'S final 51
average salary, except that if the member has more than thirty 52
years service credit earned under section 3307.31 or purchased 53
under section 3307.512 of the Revised Code, two and five-tenths 54
THE per cent of his SHALL BE THE PER CENT SHOWN IN THE FOLLOWING 55
SCHEDULE TIMES THE MEMBER'S final average salary for each 56
CORRESPONDING year or fraction of a year of service credit earned 57
or purchased under those sections that is in excess of thirty 58
years:
YEAR PER YEAR PER 61
OF CENT OF CENT 62
SERVICE FOR THAT SERVICE FOR THAT 64
CREDIT YEAR CREDIT YEAR 65
30.01-31.00 2.5% 37.01-38.00 3.2% 66
31.01-32.00 2.6 38.01-39.00 3.3 67
32.01-33.00 2.7 39.01-40.00 3.4 68
33.01-34.00 2.8 40.01-41.00 3.5 69
34.01-35.00 2.9 41.01-42.00 3.6 70
35.01-36.00 3.0 42.01-43.00 3.7 71
36.01-37.00 3.1 72
FOR PURPOSES OF THIS SCHEDULE, YEARS OF SERVICE CREDIT SHALL BE 76
ROUNDED TO THE NEAREST ONE-HUNDREDTH OF A YEAR.
(2) The annual single lifetime benefit of a member 78
determined under division (B)(1) of this section shall be 79
adjusted by the greater per cent shown in the following schedule 80
opposite his THE MEMBER'S attained age or Ohio service credit. 81
Years of Per Cent 83
Attained or Ohio Service of Base 84
Age Credit Amount 85
58 25 75% 86
59 26 80 87
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60 27 85 88
61 88 89
28 90 90
62 91 91
63 94 92
29 95 93
64 97 94
65 30 or more 100 95
Members shall vest the right to a benefit in accordance 98
with the following schedule, based on the member's attained age 99
by September 1, 1976: 100
Per Cent 102
Attained of Base 103
Age Amount 104
66 102% 106
67 104 107
68 106 108
69 108 109
70 or more 110 110
(3) The annual single lifetime benefit determined under 113
this division shall not exceed the lesser of one hundred per cent 114
of the final average salary or the limit established by section 115
415 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 116
U.S.C.A. 415, as amended. 117
(C) The annual single lifetime benefit of a member shall 119
not exceed the lesser of the sum of the following amounts or the 120
limit established by section 415 of the "Internal Revenue Code of 121
1986," 100 Stat. 2085, 26 U.S.C.A. 415, as amended: 122
(1) An annuity with a reserve equal to the member's 124
accumulated contributions; 125
(2) A pension equal to the amount in division (C)(1) of 127
this section; 128
(3) An additional pension of forty dollars annually 130
multiplied by the number of years of prior and military service 131
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credit, except years of credit purchased under section 3307.021 132
of the Revised Code; 133
(4) An additional basic annual pension of one hundred 135
eighty dollars, provided the member had ten or more years of Ohio 136
service credit as of October 1, 1956, except that such THE 137
additional basic annual pension shall not exceed the sum of the 138
annual benefits provided by divisions (C)(1), (2), and (3) of 139
this section. 140
(D) Benefits determined under this section shall be paid 142
as provided in section 3307.50 of the Revised Code. 143
Sec. 3307.384. A retirant who on the effective date of 145
this section AMENDMENT is eligible to receive an annual single 147
lifetime benefit under section 3307.38, 3307.41, or 3307.50 of 148
the Revised Code of less than six NINE thousand SIX HUNDRED 149
dollars or its actuarial equivalent shall have such THAT benefit 150
increased to six NINE thousand SIX HUNDRED dollars or its 151
actuarial equivalent if the benefit is based on an award arising 152
from thirty or more years of Ohio service credit. The benefit 153
increase provided by this section AMENDMENT shall take effect on 154
the first day of the first month following the effective date of 155
this section AMENDMENT and shall not be subject to any final 156
average salary limitation.
Sec. 3307.4013. (A) AS USED IN THIS SECTION: 158
(1) "BENEFIT" MEANS A BENEFIT, PENSION, OR ALLOWANCE UNDER 160
SECTION 3307.38, 3307.41, 3307.43, 3307.431, 3307.49, OR 3307.50 161
OF THE REVISED CODE.
(2) "CUMULATIVE PERCENTAGE CHANGE IN THE CPI" MEANS THE 163
TOTAL PERCENTAGE CHANGE IN THE CONSUMER PRICE INDEX PREPARED BY 164
THE UNITED STATES BUREAU OF LABOR STATISTICS FOR URBAN WAGE 166
EARNERS AND CLERICAL WORKERS (CPI-W: U.S. CITY AVERAGE, ALL 167
ITEMS) FROM THE THIRTY-FIRST DAY OF DECEMBER IMMEDIATELY 168
PRECEDING THE YEAR IN WHICH THE ORIGINAL BENEFIT STARTED THROUGH 169
THE THIRTY-FIRST DAY OF DECEMBER IMMEDIATELY PRECEDING THE 170
EFFECTIVE DATE OF THIS SECTION. 171
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(3) "ELIGIBLE RECIPIENT" MEANS ANY PERSON RECEIVING A 173
BENEFIT ON THE EFFECTIVE DATE OF THIS SECTION THAT HAS BEEN 174
PAYABLE TO THAT PERSON OR TO ANY OTHER PERSON FOR AT LEAST TWELVE 175
MONTHS.
(4) "ORIGINAL BENEFIT AMOUNT" MEANS THE INITIAL AMOUNT OF 177
A BENEFIT GRANTED TO THE INITIAL RECIPIENT OF THE BENEFIT. 178
(B) AS OF THE EFFECTIVE DATE OF THIS SECTION, THE STATE 180
TEACHERS RETIREMENT BOARD SHALL DETERMINE AN AMOUNT FOR EACH 181
ELIGIBLE RECIPIENT EQUAL TO THE SUM OF THE FOLLOWING AMOUNTS: 182
(1) AN AMOUNT EQUAL TO SEVENTY PER CENT OF THE ORIGINAL 184
BENEFIT AMOUNT FOR THE RECIPIENT; 185
(2) AN AMOUNT EQUAL TO THE PRODUCT OBTAINED WHEN SEVENTY 187
PER CENT OF THE ORIGINAL BENEFIT AMOUNT IS MULTIPLIED BY THE 188
CUMULATIVE PERCENTAGE CHANGE IN THE CPI FOR THE RECIPIENT. 189
(C)(1) EXCEPT AS PROVIDED IN DIVISION (C)(2) OF THIS 191
SECTION, IF THE AMOUNT OF THE ANNUAL BENEFIT PAYABLE TO AN 192
ELIGIBLE RECIPIENT ON THE EFFECTIVE DATE OF THIS SECTION IS LESS 193
THAN THE AMOUNT DETERMINED FOR THE RECIPIENT UNDER DIVISION (B) 194
OF THIS SECTION, THE BOARD SHALL RECALCULATE THAT ANNUAL BENEFIT 195
SO THAT IT EQUALS THE AMOUNT DETERMINED UNDER DIVISION (B) OF 196
THIS SECTION.
(2) IF THE RECALCULATED BENEFIT DETERMINED UNDER DIVISION 198
(C)(1) OF THIS SECTION FOR AN ELIGIBLE RECIPIENT WHOSE RETIREMENT 199
WAS EFFECTIVE BEFORE JULY 1, 1979, IS LESS THAN ONE HUNDRED THREE 200
PER CENT OF THE ANNUAL BENEFIT PAYABLE TO THE RECIPIENT ON THE 201
EFFECTIVE DATE OF THIS SECTION, THE BOARD SHALL RECALCULATE THE 202
ANNUAL BENEFIT SO THAT IT EQUALS ONE HUNDRED THREE PER CENT OF 203
THE ANNUAL BENEFIT PAYABLE TO THE RECIPIENT ON THE EFFECTIVE DATE 204
OF THIS SECTION.
AN INCREASE GRANTED BY DIVISION (C)(1) OR (2) OF THIS 206
SECTION TO A BENEFIT AMOUNT SHALL APPLY ON AND AFTER THE FIRST 207
DAY OF THE MONTH FOLLOWING THE EFFECTIVE DATE OF THIS SECTION. 208
(D) THE BOARD SHALL INCLUDE THE INCREASE IN AMOUNT PAID 210
UNDER THIS SECTION IN A PERSON'S BASE FOR PURPOSES OF FUTURE 211
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INCREASES IN ANY BENEFIT UNDER SECTION 3307.403 OF THE REVISED 212
CODE.
Section 2. That existing sections 3307.38 and 3307.384 of 214
the Revised Code are hereby repealed. 215
Section 3. Any retirant granted service retirement, as 217
provided in section 3307.38 of the Revised Code, that is based on 218
thirty-one or more years service credit earned under section 219
3307.31 or purchased under section 3307.512 of the Revised Code 220
and is effective on or after July 1, 1997, but before the
effective date of this act may, no later than December 31, 1997, 221
make application to the State Teachers Retirement Board to have 222
the retirant's benefit recalculated under section 3307.38 of the 223
Revised Code, as amended by this act, and section 3307.50 of the 224
Revised Code. On receipt of the application, the Board shall 225
inform the applicant of the benefit and options to which the 226
applicant is entitled under this act and the applicant may elect
to receive a recalculated benefit. If the applicant makes that 227
election, the Board shall pay the recalculated benefit. 228
If the recalculated benefit is greater than the applicant's 230
benefit prior to the recalculation, the Board shall make one 231
additional payment to the applicant equal to the difference 232
between the benefits the applicant received between July 1, 1997, 233
and the date of the payment and the increased benefit the 234
applicant would have received had the act gone into effect on
July 1, 1997. 235
The Board shall give written notice to each retirant 237
subject to this section that the retirant may, no later than 238
December 31, 1997, make application to the Board to have the 239
retirant's benefit recalculated under section 3307.38 of the 240
Revised Code, as amended by this act, and section 3307.50 of the
Revised Code. The Board shall deliver the notice to each 241
retirant by certified mail, return receipt requested. 242