As Passed by the Senate 1
122nd General Assembly 4
Regular Session Am. H. B. No. 339 5
1997-1998 6
REPRESENTATIVES VESPER-TIBERI-PADGETT-CORBIN-MOTTLEY-LUCAS- 8
COLONNA-TERWILLEGER-HAINES-BRITTON-BRADING-MAIER-TAYLOR- 9
WESTON-PATTON-SCHURING-VAN VYVEN-TAVARES-COUGHLIN-GARDNER- 10
OGG-METZGER-HARRIS-SULZER-SAWYER-REID-VERICH-GERBERRY- 11
BEATTY-WILSON-STAPLETON-THOMAS-PERZ-FOX-ROBERTS-CORE- 12
HOUSEHOLDER-GARCIA-CAREY-BRADY-JONES-HEALY-KRUPINSKI- 13
SUTTON-BUCHY-PRINGLE-OLMAN-MASON-ROMAN-METELSKY- 14
JOHNSON-MYERS-SALERNO- 15
SENATORS DRAKE-McLIN-DiDONATO-HERINGTON-BLESSING- 16
B. JOHNSON-NEIN-OELSLAGER-WHITE-SHOEMAKER-LATTA- 17
KEARNS-HOWARD-RAY-SCHAFRATH-SUHADOLNIK 18
20
A B I L L
To amend sections 3307.38 and 3307.384 and to enact 22
section 3307.4013 of the Revised Code to increase 23
benefits under the State Teachers Retirement 25
System, and to declare an emergency. 26
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 28
Section 1. That sections 3307.38 and 3307.384 be amended 29
and section 3307.4013 of the Revised Code be enacted to read as 30
follows:
Sec. 3307.38. Any member who has five years of service 32
credit and has attained age sixty, or who has twenty-five years 33
of service credit and has attained age fifty-five, or who has 34
thirty years of service credit shall be granted service 35
retirement after filing with the state teachers retirement board 36
a completed application on a form approved by the board. 37
(A) Service retirement shall be effective on the first day 39
of the month next following the later of: 40
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(1) The last day for which compensation was paid; or 42
(2) The attainment of minimum age or service credit 44
eligibility for benefits provided under this section. 45
Except as otherwise provided in division (D) of this 47
section, the service retirement benefit shall be the greater of 48
the benefits provided in divisions (B) and (C) of this section. 49
(B)(1) Subject to any adjustment made under division 51
(B)(2) of this section, the annual single lifetime benefit of a 53
member shall be the greater of the amounts determined by his THE
MEMBER'S Ohio service credit multiplied by one of the following: 55
(a) Eighty-six dollars; 57
(b) Two and one-tenth per cent of his THE MEMBER'S final 59
average salary, except that if the member has more than thirty 60
years service credit earned under section 3307.31 or purchased 61
under section 3307.512 of the Revised Code, two and five-tenths 62
THE per cent of his SHALL BE THE PER CENT SHOWN IN THE FOLLOWING 63
SCHEDULE TIMES THE MEMBER'S final average salary for each 64
CORRESPONDING year or fraction of a year of service credit earned 65
or purchased under those sections that is in excess of thirty 66
years:
YEAR PER YEAR PER 69
OF CENT OF CENT 70
SERVICE FOR THAT SERVICE FOR THAT 72
CREDIT YEAR CREDIT YEAR 73
30.01-31.00 2.5% 37.01-38.00 3.2% 74
31.01-32.00 2.6 38.01-39.00 3.3 75
32.01-33.00 2.7 39.01-40.00 3.4 76
33.01-34.00 2.8 40.01-41.00 3.5 77
34.01-35.00 2.9 41.01-42.00 3.6 78
35.01-36.00 3.0 42.01-43.00 3.7 79
36.01-37.00 3.1 80
FOR PURPOSES OF THIS SCHEDULE, YEARS OF SERVICE CREDIT SHALL BE 84
ROUNDED TO THE NEAREST ONE-HUNDREDTH OF A YEAR.
(2) The annual single lifetime benefit of a member 86
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determined under division (B)(1) of this section shall be 87
adjusted by the greater per cent shown in the following schedule 88
opposite his THE MEMBER'S attained age or Ohio service credit. 89
Years of Per Cent 91
Attained or Ohio Service of Base 92
Age Credit Amount 93
58 25 75% 94
59 26 80 95
60 27 85 96
61 88 97
28 90 98
62 91 99
63 94 100
29 95 101
64 97 102
65 30 or more 100 103
Members shall vest the right to a benefit in accordance 106
with the following schedule, based on the member's attained age 107
by September 1, 1976: 108
Per Cent 110
Attained of Base 111
Age Amount 112
66 102% 114
67 104 115
68 106 116
69 108 117
70 or more 110 118
(3) The annual single lifetime benefit determined under 121
this division shall not exceed the lesser of one hundred per cent 122
of the final average salary or the limit established by section 123
415 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 124
U.S.C.A. 415, as amended. 125
(C) The annual single lifetime benefit of a member shall 127
not exceed the lesser of the sum of the following amounts or the 128
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limit established by section 415 of the "Internal Revenue Code of 129
1986," 100 Stat. 2085, 26 U.S.C.A. 415, as amended: 130
(1) An annuity with a reserve equal to the member's 132
accumulated contributions; 133
(2) A pension equal to the amount in division (C)(1) of 135
this section; 136
(3) An additional pension of forty dollars annually 138
multiplied by the number of years of prior and military service 139
credit, except years of credit purchased under section 3307.021 140
of the Revised Code; 141
(4) An additional basic annual pension of one hundred 143
eighty dollars, provided the member had ten or more years of Ohio 144
service credit as of October 1, 1956, except that such THE 145
additional basic annual pension shall not exceed the sum of the 146
annual benefits provided by divisions (C)(1), (2), and (3) of 147
this section. 148
(D) Benefits determined under this section shall be paid 150
as provided in section 3307.50 of the Revised Code. 151
Sec. 3307.384. A retirant who on the effective date of 153
this section AMENDMENT is eligible to receive an annual single 155
lifetime benefit under section 3307.38, 3307.41, or 3307.50 of 156
the Revised Code of less than six NINE thousand SIX HUNDRED 157
dollars or its actuarial equivalent shall have such THAT benefit 158
increased to six NINE thousand SIX HUNDRED dollars or its 159
actuarial equivalent if the benefit is based on an award arising 160
from thirty or more years of Ohio service credit. The benefit 161
increase provided by this section AMENDMENT shall take effect on 162
the first day of the first month following the effective date of 163
this section AMENDMENT and shall not be subject to any final 164
average salary limitation.
Sec. 3307.4013. (A) AS USED IN THIS SECTION: 166
(1) "BENEFIT" MEANS A BENEFIT, PENSION, OR ALLOWANCE UNDER 168
SECTION 3307.38, 3307.41, 3307.43, 3307.431, 3307.49, OR 3307.50 169
OF THE REVISED CODE.
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(2) "CUMULATIVE PERCENTAGE CHANGE IN THE CPI" MEANS THE 171
TOTAL PERCENTAGE CHANGE IN THE CONSUMER PRICE INDEX PREPARED BY 172
THE UNITED STATES BUREAU OF LABOR STATISTICS FOR URBAN WAGE 174
EARNERS AND CLERICAL WORKERS (CPI-W: U.S. CITY AVERAGE, ALL 175
ITEMS) FROM THE THIRTY-FIRST DAY OF DECEMBER IMMEDIATELY 176
PRECEDING THE YEAR IN WHICH THE ORIGINAL BENEFIT STARTED THROUGH 177
THE THIRTY-FIRST DAY OF DECEMBER IMMEDIATELY PRECEDING THE 178
EFFECTIVE DATE OF THIS SECTION. 179
(3) "ELIGIBLE RECIPIENT" MEANS ANY PERSON RECEIVING A 181
BENEFIT ON THE EFFECTIVE DATE OF THIS SECTION THAT HAS BEEN 182
PAYABLE TO THAT PERSON OR TO ANY OTHER PERSON FOR AT LEAST TWELVE 183
MONTHS.
(4) "ORIGINAL BENEFIT AMOUNT" MEANS THE INITIAL AMOUNT OF 185
A BENEFIT GRANTED TO THE INITIAL RECIPIENT OF THE BENEFIT. 186
(B) AS OF THE EFFECTIVE DATE OF THIS SECTION, THE STATE 188
TEACHERS RETIREMENT BOARD SHALL DETERMINE AN AMOUNT FOR EACH 189
ELIGIBLE RECIPIENT EQUAL TO THE SUM OF THE FOLLOWING AMOUNTS: 190
(1) AN AMOUNT EQUAL TO SEVENTY PER CENT OF THE ORIGINAL 192
BENEFIT AMOUNT FOR THE RECIPIENT; 193
(2) AN AMOUNT EQUAL TO THE PRODUCT OBTAINED WHEN SEVENTY 195
PER CENT OF THE ORIGINAL BENEFIT AMOUNT IS MULTIPLIED BY THE 196
CUMULATIVE PERCENTAGE CHANGE IN THE CPI FOR THE RECIPIENT. 197
(C)(1) EXCEPT AS PROVIDED IN DIVISION (C)(2) OF THIS 199
SECTION, IF THE AMOUNT OF THE ANNUAL BENEFIT PAYABLE TO AN 200
ELIGIBLE RECIPIENT ON THE EFFECTIVE DATE OF THIS SECTION IS LESS 201
THAN THE AMOUNT DETERMINED FOR THE RECIPIENT UNDER DIVISION (B) 202
OF THIS SECTION, THE BOARD SHALL RECALCULATE THAT ANNUAL BENEFIT 203
SO THAT IT EQUALS THE AMOUNT DETERMINED UNDER DIVISION (B) OF 204
THIS SECTION.
(2) IF THE RECALCULATED BENEFIT DETERMINED UNDER DIVISION 206
(C)(1) OF THIS SECTION FOR AN ELIGIBLE RECIPIENT WHOSE RETIREMENT 207
WAS EFFECTIVE BEFORE JULY 1, 1979, IS LESS THAN ONE HUNDRED THREE 208
PER CENT OF THE ANNUAL BENEFIT PAYABLE TO THE RECIPIENT ON THE 209
EFFECTIVE DATE OF THIS SECTION, THE BOARD SHALL RECALCULATE THE 210
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ANNUAL BENEFIT SO THAT IT EQUALS ONE HUNDRED THREE PER CENT OF 211
THE ANNUAL BENEFIT PAYABLE TO THE RECIPIENT ON THE EFFECTIVE DATE 212
OF THIS SECTION.
AN INCREASE GRANTED BY DIVISION (C)(1) OR (2) OF THIS 214
SECTION TO A BENEFIT AMOUNT SHALL APPLY ON AND AFTER THE FIRST 215
DAY OF THE MONTH FOLLOWING THE EFFECTIVE DATE OF THIS SECTION. 216
(D) THE BOARD SHALL INCLUDE THE INCREASE IN AMOUNT PAID 218
UNDER THIS SECTION IN A PERSON'S BASE FOR PURPOSES OF FUTURE 219
INCREASES IN ANY BENEFIT UNDER SECTION 3307.403 OF THE REVISED 220
CODE.
Section 2. That existing sections 3307.38 and 3307.384 of 222
the Revised Code are hereby repealed. 223
Section 3. Any retirant granted service retirement, as 225
provided in section 3307.38 of the Revised Code, that is based on 226
thirty-one or more years service credit earned under section 227
3307.31 or purchased under section 3307.512 of the Revised Code 228
and is effective on or after July 1, 1997, but before the
effective date of this act may, no later than December 31, 1997, 229
make application to the State Teachers Retirement Board to have 230
the retirant's benefit recalculated under section 3307.38 of the 231
Revised Code, as amended by this act, and section 3307.50 of the 232
Revised Code. On receipt of the application, the Board shall 233
inform the applicant of the benefit and options to which the 234
applicant is entitled under this act and the applicant may elect
to receive a recalculated benefit. If the applicant makes that 235
election, the Board shall pay the recalculated benefit. 236
If the recalculated benefit is greater than the applicant's 238
benefit prior to the recalculation, the Board shall make one 239
additional payment to the applicant equal to the difference 240
between the benefits the applicant received between July 1, 1997, 241
and the date of the payment and the increased benefit the 242
applicant would have received had the act gone into effect on
July 1, 1997. 243
The Board shall give written notice to each retirant 245
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subject to this section that the retirant may, no later than 246
December 31, 1997, make application to the Board to have the 247
retirant's benefit recalculated under section 3307.38 of the 248
Revised Code, as amended by this act, and section 3307.50 of the
Revised Code. The Board shall deliver the notice to each 249
retirant by certified mail, return receipt requested. 250
Section 4. This act is hereby declared to be an emergency 252
measure necessary for the immediate preservation of the public 253
peace, health, and safety. The reason for such necessity is that 254
the benefits of teachers who retired in the 1960s and 1970s have 255
lost a significant amount of purchasing power due to inflation, 256
and an immediate increase in benefits is needed to regain some of
this purchasing power. Therefore, this act shall go into 257
immediate effect.