SENATORS Blessing, Furney, Brady, Espy, Johnson, Harris, Oelslager, Austria, Carnes, Hagan, Mumper, DiDonato, Wachtmann, Spada, Jacobson, Jordan, Prentiss

To amend sections 145.38 and 3305.08 of the Revised

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Code and to repeal Section 6 of Am. Sub. S.B. 144

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of the 123rd General Assembly, as subsequently

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amended, to prohibit an elected official from

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receiving a Public Employees Retirement System

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pension while earning a salary for the same public

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office, to subject employee contributions to a

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higher education alternative retirement plan to

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certain local taxes, and to declare an emergency.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 145.38 and 3305.08 of the Revised	10
Code be amended to read as follows:	11

Sec. 145.38.  (A) As used in this section and section	12
145.384 of the Revised Code:	13

(1) "PERS retirant" means a former member of the public	14
employees retirement system who is receiving one of the following:	15

(a) Age and service retirement benefits under section	16
145.32, 145.33, 145.331, 145.34, or 145.46 of the Revised Code;	17

(b) Age and service retirement benefits paid by the public	18
employees retirement system under section 145.37 of the Revised	19
Code;	20

(c) Any benefit paid by the system under a plan established	21
under section 145.81 of the Revised Code.	22

(2) "Other system retirant" means both of the following:

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(a) A member or former member of the Ohio police and fire	24
pension fund, state teachers retirement system, school employees	25
retirement system, state highway patrol retirement system, or	26
Cincinnati retirement system who is receiving age and service or	27
commuted age and service retirement benefits or a disability	28
benefit from a system of which the person is a member or former	29
member;	30

(b) A member or former member of the public employees	31
retirement system who is receiving age and service retirement	32
benefits or a disability benefit under section 145.37 of the	33
Revised Code paid by the school employees retirement system or the	34
state teachers retirement system.	35

(B)(1) Subject to this section, a PERS retirant or other	36
system retirant may be employed by a public employer. If so	37
employed, the PERS retirant or other system retirant shall	38
contribute to the public employees retirement system in accordance	39
with section 145.47 of the Revised Code, and the employer shall	40
make contributions in accordance with section 145.48 of the	41
Revised Code.	42

(2) A public employer that employs a PERS retirant or other	43
system retirant, or enters into a contract for services as an	44
independent contractor with a PERS retirant shall notify the	45
retirement board of the employment or contract not later than the	46
end of the month in which the employment or contract commences.	47
Any overpayment of benefits to a PERS retirant by the retirement	48
system resulting from delay or failure of the employer to give the	49
notice shall be repaid to the retirement system by the employer.	50

(3) On receipt of notice from a public employer that a	51
person who is an other system retirant has been employed, the	52
retirement system shall notify the retirement system of which the	53
other system retirant was a member of such employment.	54

(4)(a) A PERS retirant who has received a retirement	55
allowance for less than two months when employment subject to this	56
section commences shall forfeit the retirement allowance for any	57
month the PERS retirant is employed prior to the expiration of the	58
two-month period. Service and contributions for that period shall	59
not be included in calculation of any benefits payable to the PERS	60
retirant and those contributions shall be refunded on the	61
retirant's death or termination of the employment.	62

(b) An other system retirant who has received a retirement	63
allowance or disability benefit for less than two months when	64
employment subject to this section commences shall forfeit the	65
retirement allowance or disability benefit for any month the other	66
system retirant is employed prior to the expiration of the	67
two-month period. Service and contributions for that period shall	68
not be included in the calculation of any benefits payable to the	69
other system retirant and those contributions shall be refunded on	70
the retirant's death or termination of the employment.	71

(c) Contributions made on compensation earned after the	72
expiration of the two-month period shall be used in the	73
calculation of the benefit or payment due under section 145.384 of	74
the Revised Code.	75

(5) On receipt of notice from the Ohio police and fire	76
pension fund, school employees retirement system, or state	77
teachers retirement system of the re-employment of a PERS	78
retirant, the public employees retirement system shall not pay, or	79
if paid, shall recover, the amount to be forfeited by the PERS	80
retirant in accordance with section 742.26, 3307.35, or 3309.341	81
of the Revised Code.	82

(6) A PERS retirant who enters into a contract to provide	83
services as an independent contractor to the employer by which the	84
retirant was employed at the time of retirement or, less than two	85
months after the retirement allowance commences, begins providing	86
services as an independent contractor pursuant to a contract with	87
another public employer, shall forfeit the pension portion of the	88
retirement benefit for the period beginning the first day of the	89
month following the month in which the services begin and ending	90
on the first day of the month following the month in which the	91
services end. The annuity portion of the retirement allowance	92
shall be suspended on the day services under the contract begin	93
and shall accumulate to the credit of the retirant to be paid in a	94
single payment after services provided under the contract	95
terminate. A PERS retirant subject to division (B)(6) of this	96
section shall not contribute to the retirement system and shall	97
not become a member of the system.	98

(7) As used in this division, "employment" includes service	99
for which a PERS retirant or other system retirant, the retirant's	100
employer, or both, have waived any earnable salary for the	101
service.	102

(C)(1) Except as provided in division (C)(3) of this	103
section, this division applies to both of the following:	104

(a) A PERS retirant who, prior to September 14, 2000, made	105
an election underwas subject to division (C)(1)(b) of this	106
section as that division existed immediately prior to September	107
14, 2000, and a PERS retirant who elects under Section 6 of Am.	108
Sub. S.B. No. 144 of the 123rd General Assemblyhas not elected	109
pursuant to Am. Sub. S.B. 144 of the 123rd general assembly to	110
cease to be subject to this sectionthat division;	111

(b) A PERS retirant to whom both of the following apply:

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(i) The retirant held elective office in this state, or in	113
any municipal corporation, county, or other political subdivision	114
of this state at the time of retirement under this chapter.	115

(ii) The retirant was elected or appointed to the same	116
office for the remainder of the term or the term immediately	117
following the term during which the retirement occurred.	118

(2) A PERS retirant who is subject to this division is a	119
member of the public employees retirement system with all the	120
rights, privileges, and obligations of membership, except that the	121
membership does not include survivor benefits provided pursuant to	122
section 145.45 of the Revised Code or, beginning on the ninetieth	123
day after September 14, 2000, any amount calculated under section	124
145.401 of the Revised Code. The pension portion of the PERS	125
retirant's retirement allowance shall be forfeited until the first	126
day of the first month following termination of the employment.	127
The annuity portion of the retirement allowance shall accumulate	128
to the credit of the PERS retirant to be paid in a single payment	129
after termination of the employment. The retirement allowance	130
shall resume on the first day of the first month following	131
termination of the employment. On termination of the employment,	132
the PERS retirant shall elect to receive either a refund of the	133
retirant's contributions to the retirement system during the	134
period of employment subject to this section or a supplemental	135
retirement allowance based on the retirant's contributions and	136
service credit for that period of employment.	137

(3) This division does not apply to any of the following:

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(a) A PERS retirant elected to office who, at the time of	139
the election for the retirant's current term, was not retired but,	140
not less than ninety days prior to the election for the term,	141
filed a written declaration of intent to retire before the end of	142
the term with the board of elections of the county in which	143
petitions for nomination or election to the office were filed;	144

(b) A PERS retirant elected to office who, at the time of	145
the election for the retirant's current term, was a retirant and	146
had been retired for not less than ninety days;	147

(c) A PERS retirant appointed to office who, at the time of	148
appointment to the retirant's current term, notified the person or	149
entity making the appointment that the retirant was already	150
retired or intended to retire before the end of the term.	151

(D)(1) Except as provided in division (C) of this section,	152
a PERS retirant or other system retirant subject to this section	153
is not a member of the public employees retirement system, and,	154
except as specified in this section does not have any of the	155
rights, privileges, or obligations of membership. Except as	156
specified in division (D)(2) of this section, the retirant is not	157
eligible to receive health, medical, hospital, or surgical	158
benefits under section 145.58 of the Revised Code for employment	159
subject to this section.	160

(2) A PERS retirant subject to this section shall receive	161
primary health, medical, hospital, or surgical insurance coverage	162
from the retirant's employer, if the employer provides coverage to	163
other employees performing comparable work. Neither the employer	164
nor the PERS retirant may waive the employer's coverage, except	165
that the PERS retirant may waive the employer's coverage if the	166
retirant has coverage comparable to that provided by the employer	167
from a source other than the employer or the public employees	168
retirement system. If a claim is made, the employer's coverage	169
shall be the primary coverage and shall pay first. The benefits	170
provided under section 145.58 of the Revised Code shall pay only	171
those medical expenses not paid through the employer's coverage or	172
coverage the PERS retirant receives through a source other than	173
the retirement system.	174

(E) If the disability benefit of an other system retirant	175
employed under this section is terminated, the retirant shall	176
become a member of the public employees retirement system,	177
effective on the first day of the month next following the	178
termination with all the rights, privileges, and obligations of	179
membership. If such person, after the termination of the	180
disability benefit, earns two years of service credit under this	181
system or under the Ohio police and fire pension fund, state	182
teachers retirement system, school employees retirement system, or	183
state highway patrol retirement system, the person's prior	184
contributions as an other system retirant under this section shall	185
be included in the person's total service credit as a public	186
employees retirement system member, and the person shall forfeit	187
all rights and benefits of this section. Not more than one year	188
of credit may be given for any period of twelve months.	189

(F) This section does not affect the receipt of benefits by	190
or eligibility for benefits of any person who on August 20, 1976,	191
was receiving a disability benefit or service retirement pension	192
or allowance from a state or municipal retirement system in Ohio	193
and was a member of any other state or municipal retirement system	194
of this state.	195

(G) The public employees retirement board may adopt rules to	196
carry out this section.	197

Sec. 3305.08.  Any payment, benefit, or other right accruing	198
to any electing employee under a contract entered into for	199
purposes of an alternative retirement plan, any contributions to a	200
provider pursuant to section 3305.06 of the Revised Code, and all	201
moneys, investments, and income of those contracts are exempt from	202
any state tax, except the tax imposed by section 5747.02 of the	203
Revised Code, are exempt from any county, municipal, or other	204
local tax, except taxes imposed pursuant to section 5748.02 or	205
5748.08 of the Revised Code, and except as provided in sections	206
3105.171, 3105.65, 3111.23, 3113.21, 3115.32, 3119.80, 3119.81,	207
3121.02, 3121.03, 3123.06, and 3305.09 of the Revised Code, shall	208
not be subject to execution, garnishment, attachment, the	209
operation of bankruptcy or the insolvency law, or other process of	210
law, and shall be unassignable except as specifically provided in	211
this section and sections 3105.171, 3105.65, 3119.80, 3119.81,	212
3121.02, 3121.03,,, and 3115.32, and 3123.06 of the Revised Code	213
or in any contract the electing employee has entered into for	214
purposes of an alternative retirement plan.	215

Section 2. That existing sections 145.38 and 3305.08 of the	216
Revised Code are hereby repealed.	217

Section 3. That Section 6 of Am. Sub. S.B. 144 of the 123rd	218
General Assembly, as amended by Sub. H.B. 535 of the 123rd General	219
Assembly, is hereby repealed.	220

The intent of the repeal by this act of Section 6 of Am. Sub.	221
S.B. 144 of the 123rd General Assembly, as amended, is to	222
eliminate the authority to make the election described in that	223
section. The repeal does not affect any election made pursuant to	224
that section prior to the effective date of this act.	225

Section 4.  Section 3305.08 of the Revised Code is presented	226
in this act as a composite of the section as amended by both Sub.	227
H.B. 535 and Am. Sub. S.B. 180 of the 123rd General Assembly. The	228
General Assembly, applying the principle stated in division (B) of	229
section 1.52 of the Revised Code that amendments are to be	230
harmonized if reasonably capable of simultaneous operation, finds	231
that the composite is the resulting version of the section in	232
effect prior to the effective date of the section as presented in	233
this act.	234

Section 5. This act is hereby declared to be an emergency	235
measure necessary for the immediate preservation of the public	236
peace, health, and safety. The reason for such necessity is that	237
this act is needed to prevent certain elected officials from	238
collecting at the same time both a public pension and compensation	239
for service in the same office. Therefore, this act shall go into	240
immediate effect.	241