130th Ohio General Assembly
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H. B. No. 71  As Introduced
As Introduced

126th General Assembly
Regular Session
2005-2006
H. B. No. 71


Representatives J. Stewart, Martin, Hartnett, Seitz, Faber, Seaver, Reidelbach, White, Taylor, D. Evans, Bubp, Barrett, C. Evans, Latta, Perry, Ujvagi, Carano 



A BILL
To amend sections 145.30, 145.301, 3307.58, 3307.751, and 3309.021 of the Revised Code to permit a member of the Public Employees Retirement System to purchase military service credit for inactive duty in the Ohio National Guard or reserves.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 145.30, 145.301, 3307.58, 3307.751, and 3309.021 of the Revised Code be amended to read as follows:
Sec. 145.30.  (A) As used in this section and section 145.301 of the Revised Code:
(1) "Armed forces" of the United States includes the following:
(a) Army, navy, air force, marine corps, coast guard, auxiliary corps as established by congress, red cross nurse serving with the army, navy, air force, or hospital service of the United States, army nurse corps, navy nurse corps, full-time service with the American red cross in a combat zone, and such other service as may be designated by congress as included therein;
(b) Personnel of the Ohio national guard and the reserve components of any of the armed forces enumerated in division (A)(1) of this section who are called to active duty pursuant to an executive order issued by the president of the United States or an act of congress;
(c) Persons on whom United States merchant marine veteran status has been conferred for service aboard oceangoing merchant ships in service to the United States during World War II.
(2) "State retirement system" means any of the following: the Ohio police and fire pension fund, public employees retirement system, school employees retirement system, state highway patrol retirement system, or the state teachers retirement system.
(B) Upon reemployment in the public service and completion of one year of service credit as covered by a state retirement system or the Cincinnati retirement system, within two years after service in the armed forces that is terminated in a manner other than as described in section 4304 of Title 38 of the United States Code, "Uniformed Services Employment and Reemployment Rights Act of 1994," 108 Stat. 3149, 38 U.S.C.A. 4304, and presentation of documentation of the service and subject to rules adopted by the retirement board, any member of the public employees retirement system who was a member with not less than one year of payroll deductions before entering active duty with the armed forces and maintained membership in the public employees retirement system as provided by section 145.41 of the Revised Code, and who was or is out of active service as a public employee by reason of having become a member of the armed forces of the United States on active duty or service shall have such service, not in excess of ten years, considered as the equivalent of prior service. Service in the armed forces as established by documentation of the service, not in excess of ten years, shall also be considered prior service for a person who was a public employee and who has acquired service credit for five years prior to, and within the one year preceding, the date of entering on active duty in the armed forces of the United States if such person was reemployed in the public service within one year after service in the armed forces that is terminated in a manner other than as described in section 4304 of Title 38 of the United States Code, "Uniformed Services Employment and Reemployment Rights Act of 1994," 108 Stat. 3149, 38 U.S.C.A. 4304, and established total service credit as defined in section 145.01 of the Revised Code of twenty years exclusive of credit for service in the uniformed services, as defined in section 145.302 of the Revised Code. This division shall not serve to cancel any military service credit earned or granted prior to November 1, 1965.
(C) A member of the public employees retirement system is ineligible to receive service credit under this section for any year of military service credit used in the calculation of any retirement benefit currently being paid to the member or payable in the future under any other retirement program, except social security, or used to obtain service credit pursuant to section 145.301 or 145.302 of the Revised Code. At the time such credit is requested, the member shall certify on a form supplied by the retirement board that the member does and will conform to this requirement. This division does not cancel any military service credit earned prior to March 15, 1979.
Sec. 145.301.  (A) As used in this section:
(1) "Armed forces of the United States" includes both of the following:
(a) Army, navy, air force, marine corps, coast guard, auxiliary corps as established by congress, red cross nurse serving with the army, navy, air force, or hospital service of the United States, army nurse corps, navy nurse corps, full-time service with the American red cross in a combat zone, and such other service as may be designated by congress as included therein;
(b) Persons on whom United States merchant marine veteran status has been conferred for service aboard oceangoing merchant ships in service to the United States during World War II.
(2) "Prisoner of war" means any regularly appointed, enrolled, enlisted, or inducted member of the armed forces of the United States, reserves, or Ohio national guard who was captured, separated, and incarcerated by an enemy of the United States.
(3) "Reserves" means personnel of the reserve components of any of the armed forces of the United States enumerated in division (A)(1)(a) of this section.
(B) A member may purchase service credit that shall be considered as the equivalent of Ohio service for each year of service incurred by reason of having been on active duty as a member of the armed forces of the United States, as defined in section 145.30 of the Revised Code or active or inactive duty as a member of the reserves or Ohio national guard. The credit may be purchased at any time prior to receipt of a retirement allowance. The number of years purchased shall not exceed five. The member may choose to purchase only part of such credit in any one payment, subject to public employees retirement board rules.
(B) For the purposes of this division, "prisoner of war" means any regularly appointed, enrolled, enlisted, or inducted member of the armed forces of the United States who was captured, separated, and incarcerated by an enemy of the United States.
(C) A member may purchase service credit that shall be considered as the equivalent of Ohio service for each year of service such member was a prisoner of war. The number of years purchased under this division shall not exceed five. Service credit may be purchased under this division for the same years of service used to purchase service credit under division (A)(B) of this section. The member may choose to purchase only part of such credit in any one payment, subject to board rules.
(C)(D) The total number of years purchased under this section shall not exceed the member's total accumulated number of years of Ohio service.
(D)(E) For each year of service purchased under division (A)(B) or (B)(C) of this section, the member shall pay to the public employees retirement system for credit to the member's accumulated account an amount specified by the retirement board that shall be not less than the following:
(1) If the service credit is for active duty in the armed forces of the United States, reserves, or Ohio national guard or for service as a prisoner of war, fifty per cent of the additional liability resulting from the purchase of that year of service as determined by an actuary employed by the board;
(2) If the service credit is for inactive duty in the reserves or Ohio national guard, seventy-five per cent of the additional liability resulting from the purchase of that year of service as determined by an actuary employed by the board.
(E)(F) A member is ineligible to purchase service credit under this section for any year of military service that was:
(1) Used in the calculation of any retirement benefit currently being paid to the member or payable in the future under any other retirement program, except social security, or for retired pay for nonregular service under Chapter 1223 of Section 1662 of Title XVI of the "National Defense Authorization Act for Fiscal Year 1995," 108 Stat. 2998 (1994), 10 U.S.C.A. 12731 to 12739;
(2) Used to obtain service credit pursuant to section 145.30 or 145.302 of the Revised Code.
At the time the credit is purchased, the member shall certify on a form furnished by the retirement board that the member does and will conform to this requirement.
(F)(G) A member who, on March 17, 2000, is purchasing service credit under this section by making installment payments to the system or by a payroll deduction plan authorized under section 145.294 of the Revised Code may elect, on a form provided by the board, to have a portion of the cost of the service credit recalculated under division (D)(E) of this section as amended by House Bill 186 of the 123rd general assembly. The recalculation shall apply only to the amount still owed by the member as of the date the election is filed with the board.
For each member who makes an election, the board shall do all of the following:
(1) Determine the amount of the total cost of the service credit still owed by the member as of the date the election is filed with the board and the number of years or portion of a year of service credit attributable to that amount;
(2) Recalculate under division (D)(E) of this section the cost of the service credit described in division (F)(G)(1) of this section;
(3) Notify the member of the recalculated amount.
If the recalculated amount is less than the amount still owed by the member as of the date the election is filed, the recalculated amount shall be the amount owed by the member.
(G)(H) Credit purchased under this section may be combined pursuant to section 145.37 with credit for military service purchased under sections 3307.751 and 3309.021, except that not more than an aggregate total of five years of credit purchased under division (A)(B) of this section, division (A) of section 3307.751, and division (A) of section 3309.021, and not more than an aggregate total of five years of credit purchased under division (B)(C) of this section, division (B) of section 3307.751, and division (B) of section 3309.021 shall be used in determining retirement eligibility or calculating benefits under section 145.37 of the Revised Code.
Sec. 3307.58.  Any member participating in the plan described in sections 3307.50 to 3307.79 of the Revised Code who has five years of service credit and has attained age sixty, or who has twenty-five years of service credit and has attained age fifty-five, or who has thirty years of service credit shall be granted service retirement after filing with the state teachers retirement board a completed application on a form approved by the board.
(A) Service retirement shall be effective on the first day of the month next following the later of:
(1) The last day for which compensation was paid; or
(2) The attainment of minimum age or service credit eligibility for benefits provided under this section.
Except as provided in division (E) of this section, the service retirement benefit shall be the greater of the benefits provided in divisions (B) and (D) of this section.
(B) Subject to any adjustment made under division (C) of this section, the annual single lifetime benefit of a member shall be the greater of the amounts determined by the member's Ohio service credit multiplied by one of the following:
(1) Eighty-six dollars;
(2)(a) The sum of the following amounts:
(i) For each of the first thirty years of Ohio service credit, two and two-tenths per cent of the member's final average salary or, subject to the limitation described in division (B)(2)(b) of this section, two and five-tenths per cent of the member's final average salary if the member has thirty-five or more years of service credit under section 3307.53, 3307.57, 3307.75, 3307.751, 3307.752, 3307.761, 3307.763, 3307.77, or 3307.771 of the Revised Code, division (A)(2) or (B) of former section 3307.513 of the Revised Code, former section 3307.514 of the Revised Code, section 3307.72 of the Revised Code earned after July 1, 1978, or any combination of service credit under those sections;
(ii) For each year or fraction of a year of Ohio service credit in excess of thirty years, two and two-tenths per cent of the member's final average salary or, subject to the limitation described in division (B)(2)(b) of this section, if the member has more than thirty years service credit under section 3307.53, 3307.57, 3307.75, 3307.751, 3307.752, 3307.761, 3307.763, 3307.77, or 3307.771 of the Revised Code, division (A)(2) or (B) of former section 3307.513 of the Revised Code, former section 3307.514 of the Revised Code, section 3307.72 of the Revised Code earned after July 1, 1978, or any combination of service credit under those sections, the per cent of final average salary shown in the following schedule for each corresponding year or fraction of a year of service credit under those sections that is in excess of thirty years:
Year Per Year Per
of Cent of Cent
Service for that Service for that
Credit Year Credit Year
30.01 - 31.00 2.5% 35.01 - 36.00 3.0%
31.01 - 32.00 2.6 36.01 - 37.00 3.1
32.01 - 33.00 2.7 37.01 - 38.00 3.2
33.01 - 34.00 2.8 38.01 - 39.00 3.3
34.01 - 35.00 2.9

For purposes of this schedule, years of service credit shall be rounded to the nearest one-hundredth of a year.
(b) For purposes of division (B)(2)(a) of this section, a percentage of final average salary in excess of two and two-tenths per cent shall be applied to service credit under section 3307.57 of the Revised Code only if the service credit was established under section 145.30, 145.301, 145.302, 145.47, 145.483, 3309.02, 3309.021, 3309.022, or 3309.47 of the Revised Code or, restored under section 145.31 or 3309.26 of the Revised Code, purchased under division (B) of section 145.301 of the Revised Code for service in the active duty of the armed forces of the United States, reserves, or Ohio national guard, or purchased under division (C) of section 145.301 of the Revised Code.
(C) The annual single lifetime benefit of a member determined under division (B) of this section shall be adjusted by the greater per cent shown in the following schedule opposite the member's attained age or Ohio service credit.
Years of Per Cent
Attained or Ohio Service of Base
Age Credit Amount
58 25 75%
59 26 80
60 27 85
61 88
28 90
62 91
63 94
29 95
64 97
65 30 or more 100

Members shall vest the right to a benefit in accordance with the following schedule, based on the member's attained age by September 1, 1976:
Per Cent
Attained of Base
Age Amount
66 102%
67 104
68 106
69 108
70 or more 110

The annual single lifetime benefit determined under division (B) of this section shall not exceed the lesser of one hundred per cent of the final average salary or the limit established by section 415 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 415, as amended.
(D) The annual single lifetime benefit of a member shall not exceed the lesser of the sum of the following amounts or the limit established by section 415 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 415, as amended:
(1) An annuity with a reserve equal to the member's accumulated contributions;
(2) A pension equal to the amount in division (D)(1) of this section;
(3) An additional pension of forty dollars annually multiplied by the number of years of prior and military service credit, except years of credit purchased under section 3307.751 or 3307.752 of the Revised Code;
(4) An additional basic annual pension of one hundred eighty dollars, provided the member had ten or more years of Ohio service credit as of October 1, 1956, except that the additional basic annual pension shall not exceed the sum of the annual benefits provided by divisions (D)(1), (2), and (3) of this section.
(E) Benefits determined under this section shall be paid as provided in section 3307.60 of the Revised Code.
Sec. 3307.751.  (A) A member participating in the plan described in sections 3307.50 to 3307.79 of the Revised Code may purchase service credit that shall be considered as the equivalent of Ohio service for each year of service incurred by reason of having been on active duty as a member of the armed forces of the United States, as defined in section 3307.75 of the Revised Code. The credit may be purchased at any time prior to the effective date of a benefit. The number of years purchased under this division shall not exceed five.
(B) For the purposes of this division, "prisoner of war" means any regularly appointed, enrolled, enlisted, or inducted member of the armed forces of the United States who was captured, separated, and incarcerated by an enemy of the United States.
A member participating in the plan described in sections 3307.50 to 3307.79 of the Revised Code may purchase service credit that shall be considered as the equivalent of Ohio service for each year of service such member was a prisoner of war. The number of years purchased under this division shall not exceed five. Service credit may be purchased under this division for the same years of service used to purchase service credit under division (A) of this section.
(C) The total number of years purchased under this section shall not exceed the member's total accumulated number of years of Ohio service.
(D)(1) Except as otherwise provided in division (D)(2) of this section, for each year of service purchased under division (A) or (B) of this section, the member shall pay to the state teachers retirement system for credit to the member's accumulated account an amount determined by the member rate of contribution in effect at the time the military service began multiplied by the member's annual compensation for full-time employment during the first year of service in Ohio following termination of military service. If, however, a limit on maximum salary or maximum contribution was in effect at the time the military service began, the limit shall be applied to the salary received during the first year of service in Ohio to calculate the amount of payment. To this amount shall be added an amount equal to compound interest at a rate established by the state teachers retirement board from the date active military service terminated to date of payment.
(2) For each year of service purchased under division (A) or (B) of this section for military service that commenced on or after July 1, 1989, and, without regard to when the military service commenced, for each year of service purchased under division (A) or (B) of this section by a member who first established membership in the retirement system on or after July 1, 1989, the member shall pay to the retirement system for credit to the member's individual account an amount specified by the state teachers retirement board that shall be not less than fifty per cent of the additional liability resulting from the purchase of that year of service as determined by an actuary employed by the board.
(3) A member may choose to purchase only part of the credit the member is eligible to purchase under this section in any one payment, subject to board rules.
(E) A member of the state teachers retirement system is ineligible to purchase service credit under this section for any year of military service that was:
(1) Used in the calculation of any retirement benefit currently being paid to such member or payable in the future under any other retirement program, except for retired pay for non-regular service under Chapter 1223 of Section 1662 of Title XVI of the "National Defense Authorization Act for Fiscal Year 1995," 108 Stat. 2998 (1994), 10 U.S.C.A. 12731 to 12739, or social security;
(2) Used to obtain service credit pursuant to section 3307.75 or 3307.752 of the Revised Code.
At the time the credit is purchased, the member shall certify on a form furnished by the board that the member does and will conform to this requirement.
(F) Credit (1) Subject to division (F)(2) of this section, credit purchased under this section may be combined pursuant to section 3307.57 of the Revised Code with credit for military service purchased under sections 145.301 and section 3309.021 of the Revised Code, except that not, division (B) of section 145.301 of the Revised Code for active duty in the armed forces of the United States, reserves, or Ohio national guard, and division (C) of section 145.301 of the Revised Code.
(2) Not more than a total of five years of credit purchased under division (A) of this section, division (A)(B) of section 145.301 for active duty in the armed forces of the United States, reserves, or Ohio national guard, and division (A) of section 3309.021 and not more than a total of five years of credit purchased under division (B) of this section, division (B)(C) of section 145.301, and division (B) of section 3309.021 of the Revised Code shall be used in determining retirement eligibility or calculating benefits under section 3307.57 of the Revised Code.
Sec. 3309.021.  (A) A member may purchase service credit that shall be considered as the equivalent of Ohio service for each year of service incurred by reason of having been on active duty as a member of the armed forces of the United States, as defined in section 3309.02 of the Revised Code. All or part of the credit may be purchased at any time prior to receipt of a retirement allowance. The number of years purchased under this division shall not exceed five.
(B) For the purposes of this division, "prisoner of war" means any regularly appointed, enrolled, enlisted, or inducted member of the armed forces of the United States who was captured, separated, and incarcerated by an enemy of the United States.
A member may purchase service credit that shall be considered as the equivalent of Ohio service for each year of service such member was a prisoner of war. The number of years purchased under this division shall not exceed five. Service credit may be purchased under this division for the same years of service used to purchase service credit under division (A) of this section. The member may choose to purchase only part of such credit in any one payment, subject to board rules.
(C) The total number of years purchased under this section shall not exceed the member's total accumulated number of years of Ohio service.
(D) For each year of service purchased under division (A) or (B) of this section, the member shall pay to the school employees retirement system for credit to the member's accumulated account an amount determined by the member rate of contribution in effect at the time the military service began multiplied by the annual compensation for full-time employment during the first year of service covered by the school employees retirement system, public employees retirement system, or state teachers retirement system following termination of military service. If, however, a limit on maximum salary or maximum contribution was in effect at the time the military service began, the limit shall be applied to the salary received during the first year of service in Ohio to calculate the amount of payment. To this amount shall be added an amount equal to compound interest at a rate established by the school employees retirement board from the date of the member's first service covered by the school employees retirement system, public employees retirement system, or state teachers retirement system following termination of the military service to date of payment.
(E) A member of the school employees retirement system is ineligible to purchase service credit under this section for any year of military service that was:
(1) Used in the calculation of any retirement benefit currently being paid to the member or payable in the future under any other retirement program, except for retired pay for nonregular service under Chapter 1223 of Section 1662 of Title XVI of the "National Defense Authorization Act for Fiscal Year 1995," 108 Stat. 2998 (1994), 10 U.S.C.A. 12731 to 12739, or social security;
(2) Used to obtain service credit pursuant to section 3309.02 or 3309.022 of the Revised Code.
At the time such credit is purchased, the member shall certify on a form furnished by the retirement board that the member does and will conform to this requirement.
(F) Credit (1) Subject to division (F)(2) of this section, credit purchased under this section may be combined pursuant to section 3309.35 of the Revised Code with credit for military service purchased under sections 145.301 and section 3307.751 of the Revised Code, except that not, division (B) of section 145.301 of the Revised Code for active duty in the armed forces of the United States, reserves, or Ohio national guard, and division (C) of section 145.301 of the Revised Code.
(2) Not more than an aggregate total of five years of credit purchased under division (A) of this section, division (A)(B) of section 145.301 for active duty in the armed forces of the United States, reserves, or Ohio national guard, and division (A) of section 3307.751 of the Revised Code, and not more than an aggregate total of five years of credit purchased under division (B) of this section, division (B)(C) of section 145.301, and division (B) of section 3307.751 of the Revised Code shall be used in determining retirement eligibility or calculating benefits under section 3309.35 of the Revised Code.
Section 2. That existing sections 145.30, 145.301, 3307.58, 3307.751, and 3309.021 of the Revised Code are hereby repealed.
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