72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
SA to A-Eng. HB 3020 (A to RC)
LC 3247/HB 3020-A15
SENATE AMENDMENTS TO
A-ENGROSSED HOUSE BILL 3020
(INCLUDING AMENDMENTS TO RESOLVE CONFLICTS)
By COMMITTEE ON GENERAL GOVERNMENT
July 2
On page 1 of the printed A-engrossed bill, line 2, after the
second semicolon delete the rest of the line and delete line 3
and insert 'amending ORS 237.620, 238.005, 238.082, 238.156,
238.200, 238.225, 238.255, 238.260, 238.300, 238.305, 238.390,
238.395, 238.425, 238.458, 238.565, 238.660, 293.701, 293.706 and
293.711 and sections 6, 8, 10, 13 and 14b, chapter 67, Oregon
Laws 2003 (Enrolled House Bill 2003), sections 4, 5 and 7,
chapter 68, Oregon Laws 2003 (Enrolled House Bill 2004), and
section 2, chapter 276, Oregon Laws 2003 (Enrolled Senate Bill
258); repealing section 9, chapter 823, Oregon Laws 2001; and
declaring an emergency.'.
Delete lines 5 through 25 and delete page 2 and insert:
' { + SECTION 1. + } ORS 238.390, as amended by section 25,
chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), is
amended to read:
' 238.390. (1) { - In the event that - } { + If + } a
member of the system dies before retiring, the amount of money,
if any, credited at the time of death to the member account of
the member in the fund shall be paid to the beneficiaries
designated by the member. For this purpose a member may designate
as a beneficiary any person or the executor or administrator of
the estate of the member or a trustee named by the member to
execute an express trust in regard to such amount. The withdrawal
from the fund of the amount in the member account of a member
pursuant to ORS 238.265 shall not invalidate a prior designation
of beneficiary in the event a member returns to covered
employment, regardless of whether the sum is repaid to the fund
pursuant to ORS 238.105.
' { - (2)(a) In the event that a member of the system dies
before retiring and has not designated a beneficiary under
subsection (1) of this section, the amount of money, if any,
credited at the time of death to the member account of the member
in the fund shall be paid to the deceased's estate if it is to be
probated and, if not, then it shall be paid directly without
probate to the surviving next of kin of the deceased or the
guardian of the survivor's estate, share and share alike, payment
to be made to survivors in the following groups in the order
listed: - }
' { - (A) Husband or wife. - }
' { - (B) Children. - }
' { - (C) Father and mother. - }
' { - (D) Grandchildren. - }
' { - (E) Brothers and sisters. - }
' { - (F) Nieces and nephews. - }
' { - (b) Payment shall not be made to persons included in any
of the groups listed in paragraph (a) of this subsection should
there be living at the date of payment persons in any of the
groups preceding it as listed. Payment to the persons in any
group, upon receipt from them of an affidavit upon a form
supplied by the board, that there are no living individuals in a
group preceding it, that the estate of the deceased will not be
probated and that the amount of money, to the full extent thereof
if necessary, will be used to pay the expenses of last illness
and funeral of the deceased, shall completely discharge the board
and system on account of the death. - }
' { + (2) If a member dies before retiring and has not
designated a beneficiary under subsection (1) of this section,
the Public Employees Retirement Board shall pay the amount of
money, if any, credited at the time of death to the member
account of the deceased member to a personal representative
appointed for the estate of the deceased member. If an affidavit
has been filed under ORS 114.505 to 114.560, and the amount of
money credited to the account does not exceed the maximum amount
of personal property for which an affidavit may be filed under
ORS 114.505 to 114.560, the board shall pay the amount to the
person who filed the affidavit. + }
' (3) The beneficiary designated under subsection (1) of this
section may elect to receive the amount payable in actuarially
determined monthly payments for the life of such beneficiary as
long as such monthly payments are at least { - $30 - } { +
$200 + }.
' { - (4)(a) In the event that a member of the system dies
before retiring, has not designated a beneficiary under
subsection (1) of this section, has no surviving next of kin
referred to in subsection (2) of this section and whose estate
will not be probated, the amount of money, if any, credited at
the time of death to the member account of the member in the fund
shall be paid directly without probate for the following purposes
in the order listed: - }
' { - (A) Expenses of the funeral of the deceased. - }
' { - (B) Medical expenses of the last illness of the
deceased. - }
' { - (C) Hospital expenses of the last illness of the
deceased. - }
' { - (b) Claims for payment of expenses under this subsection
shall be filed with the board within six months after the date of
death of the deceased. If no claims are filed within the
six-month period, the amount shall be credited to the fund as are
employer contributions. If a balance of the amount remains after
payment of valid claims filed within the six-month period, the
balance shall be credited to the fund as are employer
contributions. Payments under this subsection shall completely
discharge the board and system on account of the death. - }
' { - (5) - } { + (4) + } Accrued benefits due a retired
member at the time of death are payable to the designated
beneficiary { - and, if none, to the administrator or executor
of the estate of the member. If the estate will not be probated,
they may be paid, upon receipt by the board of the affidavit
referred to - } { + or as provided + } in subsection (2)
{ - (b) - } of this section { + . + } { - , to the next of
kin in the order listed in subsection (2)(a) of this section. If
the estate will not be probated and if there is no beneficiary or
next of kin, accrued benefits or a balance due under a refund
annuity option shall be paid or credited for the purposes and in
the manner provided in subsection (4) of this section. - } For
the purpose of determining accrued benefits due a retired member
at the time of death, accrued benefits are considered to have
ceased as of the last day of the month preceding the month in
which the retired member dies; but if Option 2 or Option 3 under
ORS 238.305 has been elected as provided in this chapter and the
beneficiary survives the retired member, the benefits to the
beneficiary shall commence as of the first day of the month in
which the retired member dies, and payment of benefits under
Option 2 or Option 3 shall cease with the payment for the month
preceding the month in which the beneficiary dies.
' { + (5) If a member dies before retiring and has designated
a beneficiary under subsection (1) of this section, but the
beneficiary dies before the member, or dies before distribution
is made under this section, the Public Employees Retirement Board
shall pay the amount of money, if any, that would otherwise have
been paid to the beneficiary to a personal representative
appointed for the estate of the deceased beneficiary. If an
affidavit has been filed under ORS 114.505 to 114.560, and the
amount of money that would have been paid to the beneficiary does
not exceed the maximum amount of personal property for which an
affidavit may be filed under ORS 114.505 to 114.560, the board
shall pay the amount to the person who filed the affidavit on
behalf of the estate of the beneficiary. + }
' (6) Interest upon the member account of the member shall
accrue until the date that the amount in the member account is
distributed. Any balance in the variable account of the deceased
member is considered to be transferred to the regular account of
the member as of the date of death. The board shall establish
procedures for computing and crediting interest on the balance in
the member account for the period between the date of death and
date of distribution.
' (7) { - Payments - } { + Payment + } by the { - Public
Employees Retirement - } board of { - credits or accrued
benefits pursuant to the beneficiary designation on file with the
board or any affidavit referred to in subsection (2)(b) of - }
{ + amounts in the manner provided by + } this section
{ - shall - } completely { - discharge - } { +
discharges + } the board and system on account of the death, and
shall hold the board and system harmless from any claim for
wrongful payment.'.
On page 3, delete lines 1 through 20.
On page 11, after line 15, insert:
' { + SECTION 9. + } ORS 238.200, as amended by section 1,
chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), is
amended to read:
' 238.200. (1)(a) An active member of the Public Employees
Retirement System shall contribute to the Public Employees
Retirement Fund and there shall be withheld from salary of the
member six percent of that salary as an employee contribution.
' (b) Notwithstanding paragraph (a) of this subsection, an
employee who is an active member of the system on August 21,
1981, shall contribute to the fund and there shall be withheld
from salary of the member, as long as the employee continues to
be an active member of the system, four percent of that salary if
the salary for a month is less than $500, or five percent of that
salary if the salary for a month is $500 or more and less than
$1,000. Notwithstanding subsection (2) of this section, for the
purpose of computing the percentage of salary to be withheld
under this paragraph from a member who is an employee of a school
district or of the State Board of Higher Education whose salary
is based on an annual agreement, the agreed annual salary of the
member shall be divided into 12 equal installments, and each
installment shall be considered as earned and paid in separate,
consecutive months, commencing with the first month that payment
is actually made under the terms of the salary agreement.
' (2) The contributions of each member as provided in
subsection (1) of this section shall be deducted by the employer
from each payroll and transmitted by the employer to the Public
Employees Retirement Board, which shall cause them to be credited
to the member account of the member. Salary shall be considered
earned in the month in which it is paid. The date inscribed on
the paycheck or warrant shall be considered as the pay date,
regardless of when the salary is actually delivered to the
member.
' (3) An active member who is concurrently employed by more
than one participating public employer, and who is a member of or
entitled to membership in the system, shall make contributions to
the fund on the basis of salary paid by each employer.
' (4) Notwithstanding subsections (1) to (3) of this section, a
member of the system, or a participating employer acting on
behalf of the member pursuant to ORS 238.205, is not permitted or
required to make employee contributions to the fund { + for
service performed + } on or after January 1, 2004. { + This
subsection does not affect any contribution for the purpose of
unit purchases under ORS 238.440 or amounts paid for acquisition
of creditable service under ORS 238.105 to 238.175. + }
' { + SECTION 10. + } ORS 238.255, as amended by section 1,
chapter 3, Oregon Laws 2003 (Enrolled House Bill 2001), and
section 5, chapter 67, Oregon Laws 2003 (Enrolled House Bill
2003), is amended to read:
' 238.255. (1) The regular account for members who established
membership in the system before January 1, 1996, as described in
ORS 238.430, and for alternate payees of those members, shall be
examined each year. If the regular account is credited with
earnings for the previous year in an amount less than the
earnings that would have been credited pursuant to the assumed
interest rate for that year determined by the Public Employees
Retirement Board, the amount of the difference shall be credited
to the regular account and charged to a reserve account in the
fund established for the purpose. In years following the year for
which a charge is made to the reserve account, all earnings on
the regular accounts of members who established membership in the
system before January 1, 1996, as described in ORS 238.430, and
of alternate payees of those members, shall first be applied to
reduce or eliminate the amount of a deficit. Only earnings on the
regular accounts of members who established membership in the
system before January 1, 1996, as described in ORS 238.430, and
of alternate payees of those members, may be used to reduce or
eliminate the amount of a deficit.
' (2) Notwithstanding subsection (1) of this section { + and
except as provided in subsection (5) of this section + }, the
board may not credit any earnings to the regular accounts of
members who established membership in the system before January
1, 1996, as described in ORS 238.430, or of alternate payees of
those members, in any year in which there is a deficit in the
reserve account established under subsection (1) of this section,
or credit any earnings to the regular accounts of those members,
or alternate payees, that would result in a deficit in that
reserve account. { + In any year in which the fund experiences a
loss, the board shall charge the amount of the loss attributable
to the regular accounts of members who established membership in
the system before January 1, 1996, as described in ORS 238.430,
against the reserve account. + }
' (3) The regular account for members who established
membership in the system before January 1, 1996, as described in
ORS 238.430, and for alternate payees of those members, may not
be credited with earnings in excess of the assumed interest rate
until:
' (a) The reserve account established under subsection (1) of
this section is fully funded with amounts determined by the
board, after consultation with the actuary employed by the board,
to be necessary to ensure a zero balance in the account when all
members who established membership in the system before January
1, 1996, as described in ORS 238.430, have retired; and
' (b) The reserve account established under subsection (1) of
this section has been fully funded as described in paragraph (a)
of this subsection in each of the three immediately preceding
calendar years.
' { + (4) The board may divide the reserve account
established under subsection (1) of this section into one or more
subaccounts for the purpose of implementing the provisions of
this section.
' (5) Subsection (2) of this section does not apply to a person
who is a judge member of the system on June 30, 2003. + }
' { + SECTION 11. + } Section 6, chapter 67, Oregon Laws 2003
(Enrolled House Bill 2003), is amended to read:
' { + Sec. 6. + } { + (1) + } The amendments to ORS 238.255
by section 5 { + , chapter 67, Oregon Laws 2003 (Enrolled House
Bill 2003), + } { - of this 2003 Act - } apply only to the
crediting of earnings under ORS 238.255 for calendar years 2003
and thereafter.
' { + (2) Except as provided in subsection (3) of this
section, + } the amendments to ORS 238.255 by section 5 { + ,
chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), + }
{ - of this 2003 Act - } do not affect the crediting of
earnings to member accounts for any member who retires before
April 1, 2004, and the board shall credit the accounts of those
members in the manner provided by ORS 238.255, and rules adopted
by the Public Employees Retirement Board to implement ORS
238.255, as in effect immediately before { - the effective date
of this 2003 Act - } { + July 1, 2003 + }.
' { + (3) If a member of the system retires on or after the
effective date of this 2003 Act and before April 1, 2004, and the
member elects to receive installment payments under ORS 238.305
(4), the board shall credit interest as provided under ORS
238.305 (4)(a)(D) to reflect the actual earnings and losses of
the fund. + }
' { + SECTION 12. + } Section 8, chapter 67, Oregon Laws 2003
(Enrolled House Bill 2003), is amended to read:
' { + Sec. 8. + } (1) Notwithstanding any other provision of
this chapter, the regular account balance of a member { + or
alternate payee + } described in subsection (3) of this section
may not be less than the amount provided for under subsection (2)
of this section for the purpose of computing retirement
allowances, death benefits and amounts to be paid to a
withdrawing member under ORS 238.265 and for other computations
under the provisions of this chapter that are based on a member's
{ + or alternate payee's + } regular account balance. { + If
the regular account balance of a member or alternate payee
described in subsection (3) of this section is less than the
amount provided for under subsection (2) of this section at the
time of retirement or withdrawal of the account, the Public
Employees Retirement Board shall credit the account with the
difference and charge the amount so credited to the reserve
account established under ORS 238.255. + }
' (2) The minimum regular account balance for a member { + or
alternate payee + } described in subsection (3) of this section
is the amount that the regular account of a member { + or
alternate payee + } would have contained if the regular account
{ + of the member + } had been credited with earnings at the
assumed interest rate in every year in which the regular account
{ + of the member or alternate payee + } was in existence.
' (3) The provisions of this section apply only to { + :
' (a) + } A member who establishes membership in the system
before January 1, 1996, as described in ORS 238.430, and who
retires { + or withdraws the member account of the member + } on
or after April 1, 2004 { + ; and
' (b) An alternate payee of a member described in paragraph (a)
of this subsection + }.
' { + SECTION 13. + } Section 10, chapter 67, Oregon Laws
2003 (Enrolled House Bill 2003), is amended to read:
' { + Sec. 10. + } (1) Notwithstanding ORS 238.360, cost of
living increases for { - that portion of - } a service
retirement allowance
{ - that is not attributable to a variable annuity under ORS
238.260 and - } that is payable to or on account of members
described in subsection (5) of this section may be made only as
provided by this section.
' (2) The Public Employees Retirement Board shall calculate a
revised service retirement allowance for { - that portion
of - } a service retirement allowance { - that is not
attributable to a variable annuity under ORS 238.260 and - }
that is payable to members described in subsection (5) of this
section. The revised service retirement allowance shall be
calculated as follows:
' (a) The board shall establish a member account balance for
the member as of the member's effective date of retirement,
determined as though the regular member account for the member
had been credited with 11.33 percent earnings { - in - } { +
for + } calendar year 1999.
' { - (b) The board shall calculate a service retirement
allowance for the member under ORS 238.300 as of the member's
effective date of retirement, using the member account balance
established under paragraph (a) of this subsection. - }
' { + (b) The board shall calculate a service retirement
allowance for the member as of the member's effective date of
retirement using the member account balance established under
paragraph (a) of this subsection. The board shall make the
calculation under ORS 238.300, section 4, chapter 68, Oregon Laws
2003 (Enrolled House Bill 2004), and such other provisions of
this chapter as may be applicable to the calculation of the
service retirement allowance of the member or as may provide for
increases or decreases in the service retirement allowance of the
member. + }
' (c) If the member elected an optional service retirement
allowance calculation under ORS 238.305, the board shall convert
the service retirement allowance calculated under paragraph (b)
of this subsection to the optional calculation elected by the
member { + and shall make any adjustment required by section 4,
chapter 68, Oregon Laws 2003 (Enrolled House Bill 2004), or by
any other provision of this chapter + }.
' (d) The board shall adjust the revised service retirement
allowance calculated under paragraph (b) or (c) of this
subsection for each calendar year after the member's effective
date of retirement based on the cost of living adjustment
provided for in ORS 238.360.
' (3) The board shall calculate a fixed service retirement
allowance for members described in subsection (5) of this
section. The fixed service retirement allowance shall be the
amount { - that is not attributable to a variable annuity under
ORS 238.260 and - } that is payable to or on account of the
member on
{ - the effective date of this 2003 Act - } { + July 1, 2003,
or on the member's effective date of retirement, whichever is
later + }. The fixed service retirement allowance may not be
adjusted under ORS 238.360.
' (4) The service retirement allowance payable to or on account
of members described in subsection (5) of this section shall be
the greater of the revised service retirement allowance
calculated under subsection (2) of this section or the fixed
service retirement allowance calculated under subsection (3) of
this section.
' (5) The provisions of this section apply to members who:
' (a) Established membership in the Public Employees Retirement
System before January 1, 1996, as described in ORS 238.430;
' (b) Receive a service retirement allowance calculated under
ORS 238.300 (2)(b)(A); and
' (c) Have an effective date of retirement that is on or after
April 1, 2000, and before April 1, 2004.
' { + (6) The provisions of this section apply to the
alternate payees and beneficiaries of members described in
subsection (5) of this section. The provisions of this section do
not apply to judge members. + }
' { + SECTION 14. + } Section 13, chapter 67, Oregon Laws
2003 (Enrolled House Bill 2003), is amended to read:
' { + Sec. 13. + } (1) An active member of the Public
Employees Retirement System, as defined by ORS 238.005, shall
make payments to a transition account established for the member
under the provisions of this section. Payments must be in the
amount of six percent of the salary, as defined by ORS 238.005,
of the employee.
' (2) A public employer, as defined by ORS 238.005, that
participates in the system may agree to make all or part of the
transition payments on behalf of employees of the public employer
who are active members of the system. An agreement may be made by
a collective bargaining agreement or by policy of the employer.
' (3) A public employer, as defined by ORS 238.005, that
participates in the system and that is paying employee
contributions on behalf of employees of the public employer under
the provisions of ORS 238.205 on December 31, 2003, whether by
reason of having agreed to 'pick-up' or by reason of having
agreed to assume or pay those contributions, must make the
employee payments required by subsection (1) of this section
until December 31, 2005.
' (4) Payments to a transition account under this section may
not be considered employee contributions to the system for any
purpose.
' (5)(a) The Public Employees Retirement Board shall establish
a transition account program for payments made under this
section. All assets of the program are held in trust for the
exclusive benefit of the members of the system. Except as
otherwise provided by law, the board is declared to be the
trustee of the assets of the transition account program. { + The
board may create separate accounts within the Public Employees
Retirement Fund for the assets of the transition account program.
Investment of the assets of the transition account program is not
subject to the limitations imposed by ORS 293.726 (6). + }
' (b) The board shall keep a separate transition account for
each member of the system { - that - } { + who + } makes
payments under the provisions of this section. Except as provided
in subsection (9) of this section, all earnings and losses on a
transition account shall be credited by the board to the
transition account. If the membership of the employee in the
system is terminated under the provisions of ORS 238.095, the
board shall cease crediting of earnings and losses to the
transition account of the member.
' (6) Amounts held in a transition account under this section
must be distributed to the member within 90 days after the
member's effective date of retirement under ORS chapter 238
{ - , or within 90 days after termination of the person's
membership in the system under ORS 238.095 - } . { + A member
may withdraw the amount in the member's transition account at any
time after the member is separated from all service with
participating public employers and from all service with
employers who are treated as part of a participating public
employer's controlled group under the federal laws and rules
governing the status of the system and the fund as a qualified
governmental retirement plan and trust. Upon the death of any
member, the amounts in the member's transition account shall be
distributed to the personal representative for the estate of the
member, or to a person filing an affidavit under ORS 114.505 to
114.560 if the amount of moneys credited to the account do not
exceed the maximum amount of personal property for which an
affidavit may be filed under ORS 114.505 to 114.560. + }
' (7) Distribution from a member's transition account shall be
made in a single lump sum payment. { + ORS 238.445 and 238.465
apply to amounts held in and payable from a member's transition
account. + }
' (8) The board shall adopt rules and establish procedures for
transition payments and accounts.
' (9) The board shall by rule establish a maintenance fee for
transition accounts established under this section. The fee may
be collected out of earnings on transition accounts or, if there
are no earnings, from the principal amounts paid into the
transition accounts. The fee shall be in an amount determined by
the board to be adequate to pay the full cost to the system of
maintaining transition accounts under this section.
' (10) The board shall take all actions necessary to qualify
the transition account program as a tax-qualified governmental
retirement plan and trust under the Internal Revenue Code.
' { + (11) The board may contract with a private provider for
the administration of the transition account program. The board
is not subject to the provisions of ORS 279.005 to 279.111 in
awarding a contract under the provisions of this subsection. The
board shall establish procedures for inviting proposals and
awarding contracts under this subsection.
' (12) A member of the system may not make payments to a
transition account under the provisions of this section during
any period of time that the member is required to make
contributions to the system under ORS 238.200. + }
' { - (11) - } { + (13) + } Nothing in this section creates
a contract between members of the Public Employees Retirement
System and participating public employers.
' { + (14) The provisions of this section do not apply to
judge members. + }
' { + SECTION 15. + } ORS 238.425, as amended by section 12,
chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), is
amended to read:
' 238.425. In the event that an employee who is a vested member
of the system and who has not attained earliest service
retirement age is separated, for any reason other than death or
disability, from all service entitling the employee to membership
in the system, the member account, if any, of the member shall
remain to the member's credit in the fund unless the member
elects to withdraw it and there shall be paid such death benefits
as this chapter provides; or a disability retirement allowance
or, after attaining earliest service retirement age, a service
retirement allowance, either of which shall consist of the
allowance provided in ORS 238.300, but actuarially reduced
{ - and computed - } { + based + } on the member's then
attained age.
' { + SECTION 16. + } Section 4, chapter 68, Oregon Laws 2003
(Enrolled House Bill 2004), as amended by section 40, chapter 67,
Oregon Laws 2003 (Enrolled House Bill 2003), is amended to read:
' { + Sec. 4. + } (1) Subject to subsections (2) and (3) of
this section, for the purpose of computing the retirement
allowance of members and alternate payees with effective dates of
retirement on or after July 1, 2003, and before January 1, 2005,
the Public Employees Retirement Board shall use actuarial
equivalency factor tables that are based on the mortality
assumptions { + of the actuary's 2001 experience study as + }
adopted by the board on September 10, 2002.
' (2) The retirement allowance of any member or alternate payee
who has an effective date of retirement on or after July 1, 2003,
shall be the higher of the following amounts:
' (a) The amount calculated for the retirement allowance
selected by the member under ORS 238.300, 238.305, 238.320 or
238.325 determined as of the member's or alternate payee's
effective date of retirement { + , using all calculations
applicable to the member under ORS 238.300 (2) and + } using
actuarial equivalency factor tables in effect on the effective
date of retirement for the purpose of all calculations using
actuarial equivalency factor tables; or
' (b) The amount calculated under subsection (3) of this
section.
' (3) For each member or alternate payee described in
subsection (2) of this section, the board shall establish years
of service, an account balance and a final average salary as of
June 30, 2003. Years of service for the member as of June 30,
2003, shall include all creditable service of the member
determined as of June 30, 2003, including any retirement credit
acquired by the member under ORS 238.105 to 238.175 before July
1, 2003. The account balance shall include all employee
contributions made by or on behalf of the member as of June 30,
2003, and earnings on those contributions as of June 30, 2003,
credited in the manner provided by board rules in effect on
{ - the effective date of this 2003 Act - } { + May 9,
2003, + } governing crediting of earnings upon retirement of a
member. The board shall then calculate the retirement allowance
selected by the member under ORS 238.300, 238.305, 238.320 or
238.325, { + using all calculations applicable to the member
under ORS 238.300 (2), + }except that:
' (a) The board shall use the actuarial equivalency factor
tables in effect on June 30, 2003, for the purpose of all
calculations using actuarial equivalency factor tables; and
' (b) The board shall use the years of service, account balance
and final average salary established by the board under this
subsection for the member as of June 30, 2003.
' (4) The board need not perform the calculations described in
subsections (2) and (3) of this section for a member if the board
actuarially determines that one of the calculations described in
subsection (2) or (3) of this section necessarily provides the
highest amount.
' (5) Any monthly payments to be made to a death beneficiary
under ORS 238.390, 238.395 or 238.405 for a member who dies on or
after { - the effective date of this 2003 Act - } { + May 9,
2003, + } shall be calculated using the actuarial equivalency
factor tables that are in effect on the date that the first
payment is due to the death beneficiary.
' { + (6) This section and section 2, chapter 68, Oregon Laws
2003 (Enrolled House Bill 2004), do not apply to the calculation
of the retirement allowance and surviving spouse pension of a
person who is a judge member on June 30, 2003, and who makes an
election under ORS 238.565 (4). The board shall use the actuarial
equivalency factor tables in effect on June 30, 2003, for the
purpose of calculating the retirement allowance and surviving
spouse pension of a person who is a judge member on June 30,
2003, and who makes an election under ORS 238.565 (4), whether
that election is made before, on or after June 30, 2003. + }
' { + SECTION 17. + } Section 5, chapter 68, Oregon Laws 2003
(Enrolled House Bill 2004), is amended to read:
' { + Sec. 5. + } { - (1) Exclusive jurisdiction is
conferred on the Supreme Court to determine in the manner
provided by this section whether the implementation of actuarial
equivalency factor tables under section 2 or 4 of this 2003 Act
breaches any contract between members of the Public Employees
Retirement System and their employers, or violates any
constitutional provision, including but not limited to impairment
of contract rights of members of the Public Employees Retirement
System under section 21, Article I of the Oregon Constitution, or
clause 1, section 10, Article I of the United States
Constitution. - }
' { - (2) Under the jurisdiction conferred in subsection (1)
of this section, any person aggrieved by the implementation of
actuarial equivalency factor tables under section 2 or 4 of this
2003 Act may petition the Supreme Court for relief. The petition
must state the facts showing how the petitioner is aggrieved and
the grounds upon which the petition is based. The Supreme Court
shall give priority on its docket to a petition for relief filed
under this section and shall expedite a decision on the petition.
Any and all petitions filed under this section alleging a similar
basis or bases of challenge may be consolidated by the Supreme
Court upon its own motion. - }
' { - (3) A person petitioning for relief under this section
is not required to exhaust administrative remedies or file in any
other court. - }
' { - (4) A petition for relief under this section must be
filed before August 15, 2003. - }
' { - (5) A petition for relief under this section must
present a justiciable controversy. The petitioner must serve a
copy of the petition on the Attorney General. - }
' { - (6) Any public employer participating in the Public
Employees Retirement System may intervene in any proceeding
commenced under this section. - }
' { - (7) If the Supreme Court determines that factual
determinations are necessary for resolution of a proceeding
commenced under this section, the Supreme Court may appoint a
special master to hear evidence and prepare proposed findings of
fact. If the Supreme Court appoints a special master, the court
shall allow the parties to conduct discovery under ORCP 36 to
46. - }
' { - (8) A petition under this section is the exclusive means
of determining whether the implementation of actuarial
equivalency factor tables under section 2 or 4 of this 2003 Act
breaches any contract between members of the Public Employees
Retirement System and their employers, or violates any
constitutional provision, including but not limited to impairment
of contract rights of members of the Public Employees Retirement
System under section 21, Article I of the Oregon Constitution, or
clause 1, section 10, Article I of the United States
Constitution. - }
' { + (1) Jurisdiction is conferred on the Supreme Court to
determine in the manner provided by this section whether the
implementation of actuarial equivalency factor tables under
section 2 or 4, chapter 68, Oregon Laws 2003 (Enrolled House Bill
2004), breaches any contract between members of the Public
Employees Retirement System and their employers, or violates any
constitutional provision, including but not limited to impairment
of contract rights of members of the Public Employees Retirement
System under section 21, Article I of the Oregon Constitution, or
clause 1, section 10, Article I of the United States
Constitution.
' (2) A person who is adversely affected by chapter 68, Oregon
Laws 2003 (Enrolled House Bill 2004), or who will be adversely
affected by chapter 68, Oregon Laws 2003 (Enrolled House Bill
2004), may institute a proceeding for review by filing with the
Supreme Court a petition that meets the following requirements:
' (a) The petition must be filed before August 15, 2003.
' (b) The petition must include the following:
' (A) A statement of the basis of the challenge; and
' (B) A statement and supporting affidavit showing how the
petitioner is adversely affected.
' (3) The petitioner shall serve a copy of the petition by
registered or certified mail upon the Public Employees Retirement
Board, the Attorney General and the Governor.
' (4) Proceedings for review under this section shall be given
priority over all other matters before the Supreme Court.
' (5) The Supreme Court shall allow public employers
participating in the Public Employees Retirement System to
intervene in any proceeding under this section.
' (6) In the event the Supreme Court determines that there are
factual issues in the petition, the Supreme Court may appoint a
special master to hear evidence and to prepare recommended
findings of fact. + }
' { + SECTION 18. + } Section 7, chapter 68, Oregon Laws 2003
(Enrolled House Bill 2004), is amended to read:
' { + Sec. 7. + } (1) The Public Employees Retirement Board
shall conduct a study of the life expectancy of members of the
Public Employees Retirement System in the categories described in
subsection (2) of this section. If the board determines that
members in the categories described in subsection (2) of this
section have a life expectancy that is substantially shorter than
the life expectancy of members of the system generally, the board
shall adopt and use separate actuarial equivalency factor tables
under section 2 { + , chapter 68, Oregon Laws 2003 (Enrolled
House Bill 2004), + } { - of this 2003 Act - } for the purpose
of computing the payments to be made to members in the categories
described in subsection (2) of this section and to the
beneficiaries and alternate payees of those members. Any
actuarial equivalency factor tables adopted under this section
shall first become effective January 1, 2005.
' (2) The provisions of this section apply to members of the
system who are defined as firefighters under ORS 238.005 (9) or
as police officers under ORS 238.005 (16)(a), (b), (d), (e), (f),
{ + (k), + } (L), (n), (o) or (p).
' { + SECTION 19. + } { + The amendments to ORS 238.260 by
section 3, chapter 67, Oregon Laws 2003 (Enrolled House Bill
2003), do not apply to any judge member who is a judge member of
the system on June 30, 2003. A person who is a judge member of
the system on June 30, 2003, may continue to make contributions
to the Variable Annuity Account for services as a judge member
performed on or after January 1, 2004. + }
' { + SECTION 20. + } ORS 238.005, as amended by section 16,
chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), is
amended to read:
' 238.005. For purposes of this chapter:
' (1) 'Annuity' means payments for life derived from
contributions made by a member as provided in this chapter.
' (2) 'Board' means the Public Employees Retirement Board.
' (3) 'Calendar year' means 12 calendar months commencing on
January 1 and ending on December 31 following.
' (4) 'Continuous service' means service not interrupted for
more than five years, except that such continuous service shall
be computed without regard to interruptions in the case of:
' (a) An employee who had returned to the service of the
employer as of January 1, 1945, and who remained in that
employment until having established membership in the Public
Employees Retirement System.
' (b) An employee who was in the armed services on January 1,
1945, and returned to the service of the employer within one year
of the date of being otherwise than dishonorably discharged and
remained in that employment until having established membership
in the Public Employees Retirement System.
' (5) 'Creditable service' means any period of time during
which an active member is being paid a salary by a participating
public employer and { - contributions are being made to the
system either by or on behalf of the member - } { + for which
benefits under this chapter are funded by employer contributions
and earnings on the fund + }. For purposes of computing years of
'creditable service, ' full months and major fractions of a month
shall be considered to be one-twelfth of a year and shall be
added to all full years. ' Creditable service' includes all
retirement credit received by a member.
' (6) 'Earliest service retirement age' means the age attained
by a member when the member could first make application for
retirement under the provisions of ORS 238.280.
' (7) 'Employee' includes, in addition to employees, public
officers, but does not include:
' (a) Persons engaged as independent contractors.
' (b) Seasonal, emergency or casual workers whose periods of
employment with any public employer or public employers do not
total 600 hours in any calendar year.
' (c) Persons, other than workers in the Oregon Industries for
the Blind under ORS 346.190, provided sheltered employment or
made-work by a public employer in an employment or industries
program maintained for the benefit of such persons.
' (d) Persons employed and paid from federal funds received
under the Emergency Job and Unemployment Assistance Act of 1974
(Public Law 93-567) or any other federal program intended
primarily to alleviate unemployment. However, any such person
shall be considered an 'employee' if not otherwise excluded by
paragraphs (a) to (c) of this subsection and the public employer
elects to have the person so considered by an irrevocable written
notice to the board.
' (e) Persons who are employees of a railroad, as defined in
ORS 824.020, and who, as such employees, are included in a
retirement plan under federal railroad retirement statutes. This
paragraph shall be deemed to have been in effect since the
inception of the system.
' (8) 'Final average salary' means whichever of the following
is greater:
' (a) The average salary per calendar year paid by one or more
participating public employers to an employee who is an active
member of the system in three of the calendar years of membership
before the effective date of retirement of the employee, in which
three years the employee was paid the highest salary. The three
calendar years in which the employee was paid the largest total
salary may include calendar years in which the employee was
employed for less than a full calendar year. If the number of
calendar years of active membership before the effective date of
retirement of the employee is three or fewer, the final average
salary for the employee is the average salary per calendar year
paid by one or more participating public employers to the
employee in all of those years, without regard to whether the
employee was employed for the full calendar year.
' (b) One-third of the total salary paid by a participating
public employer to an employee who is an active member of the
system in the last 36 calendar months of active membership before
the effective date of retirement of the employee.
' (9) 'Firefighter' does not include a volunteer firefighter,
but does include:
' (a) The State Fire Marshal, the chief deputy fire marshal and
deputy state fire marshals; and
' (b) An employee of the State Forestry Department who is
certified by the State Forester as a professional wildland
firefighter and whose primary duties include the abatement of
uncontrolled fires as described in ORS 477.064.
' (10) 'Fiscal year' means 12 calendar months commencing on
July 1 and ending on June 30 following.
' (11) 'Fund' means the Public Employees Retirement Fund.
' (12)(a) 'Member' means a person who has established
membership in the system and whose membership has not been
terminated as described in ORS 238.095. 'Member' includes active,
inactive and retired members.
' (b) 'Active member' means a member who is presently employed
by a participating public employer in a position that meets the
requirements of ORS 238.015 (4), and who has completed the
six-month period of service required by ORS 238.015.
' (c) 'Inactive member' means a member who is absent from the
service of all employers participating in the system, whose
membership has not been terminated in the manner described by ORS
238.095, and who is not retired for service or disability. '
Inactive member' includes a member who would be an active member
except that the person's only employment with a participating
public employer is in a position that does not meet the
requirements of ORS 238.015 (4).
' (d) 'Retired member' means a member who is retired for
service or disability.
' (13)(a) 'Member account' means the regular account and the
variable account.
' (b) 'Regular account' means the account established for each
active and inactive member under ORS 238.250.
' (c) 'Variable account' means the account established for a
member who participates in the Variable Annuity Account under ORS
238.260.
' (14) 'Normal retirement age' means:
' (a) For a person who establishes membership in the system
before January 1, 1996, as described in ORS 238.430, 55 years of
age if the employee retires at that age as a police officer or
firefighter or 58 years of age if the employee retires at that
age as other than a police officer or firefighter.
' (b) For a person who establishes membership in the system on
or after January 1, 1996, as described in ORS 238.430, 55 years
of age if the employee retires at that age as a police officer or
firefighter or 60 years of age if the employee retires at that
age as other than a police officer or firefighter.
' (15) 'Pension' means annual payments for life derived from
contributions by one or more public employers.
' (16) 'Police officer' includes:
' (a) Employees of institutions defined in ORS 421.005 as
Department of Corrections institutions whose duties, as assigned
by the Director of the Department of Corrections, include the
custody of persons committed to the custody of or transferred to
the Department of Corrections and employees of the Department of
Corrections who were classified as police officers on or before
July 27, 1989, whether or not such classification was authorized
by law.
' (b) Employees of the Department of State Police who are
classified as police officers by the Superintendent of State
Police.
' (c) Employees of the Oregon Liquor Control Commission who are
classified as enforcement officers by the administrator of the
commission.
' (d) Sheriffs and those deputy sheriffs or other employees of
a sheriff whose duties, as classified by the sheriff, are the
regular duties of police officers or corrections officers.
' (e) Police chiefs and police personnel of a city who are
classified as police officers by the council or other governing
body of the city.
' (f) Parole and probation officers employed by the Department
of Corrections, parole and probation officers who are transferred
to county employment under ORS 423.549 and adult parole and
probation officers, as defined in ORS 181.610, who are classified
as police officers for the purposes of this chapter by the county
governing body. If a county classifies adult parole and probation
officers as police officers for the purposes of this chapter, and
the employees so classified are represented by a labor
organization, any proposal by the county to change that
classification or to cease to classify adult parole and probation
officers as police officers for the purposes of this chapter is a
mandatory subject of bargaining.
' (g) Police officers appointed under ORS 276.021 or 276.023.
' (h) Employees of the Port of Portland who are classified as
airport police by the Board of Commissioners of the Port of
Portland.
' (i) Employees of the State Department of Agriculture who are
classified as livestock police officers by the Director of
Agriculture.
' (j) Employees of the Department of Public Safety Standards
and Training who are classified by the department as other than
secretarial or clerical personnel.
' (k) Investigators of the Criminal Justice Division of the
Department of Justice.
' (L) Corrections officers as defined in ORS 181.610.
' (m) Employees of the Oregon State Lottery Commission who are
classified by the Director of the Oregon State Lottery as
enforcement agents pursuant to ORS 461.110.
' (n) The Director of the Department of Corrections.
' (o) An employee who for seven consecutive years has been
classified as a police officer as defined by this section, and
who is employed or transferred by the Department of Corrections
to fill a position designated by the Director of the Department
of Corrections as being eligible for police officer status.
' (p) An employee of the Department of Corrections classified
as a police officer on or prior to July 27, 1989, whether or not
that classification was authorized by law, as long as the
employee remains in the position held on July 27, 1989. The
initial classification of an employee under a system implemented
pursuant to ORS 240.190 does not affect police officer status.
' (q) Employees of a school district who are appointed and duly
sworn members of a law enforcement agency of the district as
provided in ORS 332.531 or otherwise employed full-time as police
officers commissioned by the district.
' (r) Employees at the MacLaren School, Hillcrest School of
Oregon and other youth correction facilities and juvenile
detention facilities under ORS 419A.050, 419A.052 and 420.005 to
420.915, who are required to hold valid Oregon teaching licenses
and who have supervisory, control or teaching responsibilities
over juveniles committed to the custody of the Department of
Corrections or the Oregon Youth Authority.
' (s) Employees at youth correction facilities as defined in
ORS 420.005 whose primary job description involves the custody,
control, treatment, investigation or supervision of juveniles
placed in such facilities.
' (t) Employees of the Oregon Youth Authority who are
classified as juvenile parole and probation officers.
' (17) 'Public employer' means the state, one of its agencies,
any city, county, or municipal or public corporation, any
political subdivision of the state or any instrumentality
thereof, or an agency created by one or more such governmental
organizations to provide governmental services. For purposes of
this chapter, such agency created by one or more governmental
organizations is a governmental instrumentality and a legal
entity with power to enter into contracts, hold property and sue
and be sued.
' (18) 'Prior service credit' means credit provided under ORS
238.442 or under ORS 238.225 (2) to (6) (1999 Edition).
' (19) 'Retirement credit' means a period of time that is
treated as creditable service for the purposes of this chapter.
' (20)(a) 'Salary' means the remuneration paid an employee in
cash out of the funds of a public employer in return for services
to the employer, plus the monetary value, as determined by the
Public Employees Retirement Board, of whatever living quarters,
board, lodging, fuel, laundry and other advantages the employer
furnishes the employee in return for services.
' (b) 'Salary' includes but is not limited to:
' (A) Payments of employee and employer money into a deferred
compensation plan, which are deemed salary paid in each month of
deferral;
' (B) The amount of participation in a tax-sheltered or
deferred annuity, which is deemed salary paid in each month of
participation; and
' (C) Retroactive payments made to an employee to correct a
clerical error or pursuant to an award by a court or by order of
or a conciliation agreement with an administration agency charged
with enforcing federal or state law protecting the employee's
rights to employment or wages, which shall be allocated to and
deemed paid in the periods in which the work was done or in which
it would have been done.
' (c) 'Salary' or 'other advantages' does not include:
' (A) Travel or any other expenses incidental to employer's
business which is reimbursed by the employer;
' (B) Payments for insurance coverage by an employer on behalf
of employee or employee and dependents, for which the employee
has no cash option;
' (C) Payments made on account of an employee's death;
' (D) Any lump sum payment for accumulated unused sick leave;
' (E) Any accelerated payment of an employment contract for a
future period or an advance against future wages;
' (F) Any retirement incentive, retirement severance pay,
retirement bonus or retirement gratuitous payment;
' (G) Payments for periods of leave of absence after the date
the employer and employee have agreed that no future services
qualifying pursuant to ORS 238.015 (3) will be performed, except
for sick leave and vacation;
' (H) Payments for instructional services rendered to
institutions of the Department of Higher Education or the Oregon
Health and Science University when such services are in excess of
full-time employment subject to this chapter. A person employed
under a contract for less than 12 months is subject to this
subparagraph only for the months to which the contract pertains;
or
' (I) Payments made by an employer for insurance coverage
provided to a domestic partner of an employee.
' (21) 'School year' means the period beginning July 1 and
ending June 30 next following.
' (22) 'System' means the Public Employees Retirement System.
' (23) 'Vested' means being an active member of the system in
each of five calendar years.
' (24) 'Volunteer firefighter' means a firefighter whose
position normally requires less than 600 hours of service per
year.
' { + SECTION 21. + } ORS 238.156 is amended to read:
' 238.156. (1) Notwithstanding any other provision of this
chapter, but subject to subsection (4) of this section, an
employee who leaves a position that meets the requirements of ORS
238.015 (4) for the purpose of performing service in the
uniformed services is entitled to receive contributions, benefits
and service credit for the period under rules adopted by the
Public Employees Retirement Board pursuant to subsection (2) of
this section.
' (2) The board shall adopt rules establishing contributions,
benefits and service credit for any period of service in the
uniformed services by an employee described in subsection (1) of
this section. For the purpose of adopting rules under this
subsection, the board shall consider and take into account all
federal law relating to contributions, benefits and service
credit for any period of service in the uniformed services.
Contributions, benefits and service credit under rules adopted by
the board pursuant to this subsection may not exceed
contributions, benefits and service credit required under federal
law for periods of service in the uniformed services.
' (3) Subject to subsection (4) of this section, an employee
who leaves a position that meets the requirements of ORS 238.015
(4) for the purpose of entering or reentering active service in
the Armed Forces shall acquire retirement credit for the period
during which the employee served in the Armed Forces if:
' (a) The employee returns to the service of the employer who
employed the employee immediately before commencing service in
the Armed Forces in a position that meets the requirements of ORS
238.015 (4);
' (b) The employee returns to that employment within one year
after being otherwise than dishonorably discharged from the Armed
Forces and within five years after the date that the employee
entered or reentered active service in the Armed Forces; and
' (c) After returning to employment and before retirement, the
employee pays to the Public Employees Retirement Board in a lump
sum { - the total amount of contributions the employee would
have made throughout - } { + six percent of the salary that
would have been paid to the member during + } the period of
military service in the Armed Forces based on the employee's
salary rate at the time the employee entered or reentered the
Armed Forces, as though the employee had remained in the
employment of the employer. Any lump sum contribution made under
this paragraph shall be added to the employee's regular
account { + , or to the employee's transition account established
under section 13, chapter 67, Oregon Laws 2003 (Enrolled House
Bill 2003), if the employee does not have a regular account, + }
and in all respects shall be considered as though made by payroll
deduction.
' (4) An employee may not receive benefits under both
subsections (1) and (3) of this section for the same period of
service in the Armed Forces or uniformed services. If an employee
is entitled to benefits under both subsections (1) and (3) of
this section by the terms of those provisions, the employee shall
receive benefits under the subsection that provides the greater
benefit.
' (5) For the purposes of this section, 'Armed Forces' means
the Army, Navy, Air Force, Marine Corps and Coast Guard.
' { + SECTION 22. + } ORS 238.300, as amended by section 4,
chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), is
amended to read:
' 238.300. Upon retiring from service at normal retirement age
or thereafter, a member of the system shall receive a service
retirement allowance which shall consist of the following annuity
and pensions:
' (1) A refund annuity which shall be the actuarial equivalent
of accumulated contributions, if any, by the member and interest
thereon credited at the time of retirement, which annuity shall
provide an allowance payable during the life of the member and at
death a lump sum equal in amount to the difference between
accumulated contributions at the time of retirement and the sum
of the annuity payments actually made to the member during life
shall be paid to such person, if any, as the member nominates by
written designation duly acknowledged and filed with the board or
shall otherwise be paid according to the provisions of this
chapter for disposal of an amount credited to the member account
of a member at the time of death in the event the member
designates no beneficiary to receive the amount or no such
beneficiary is able to receive the amount. If death of the member
occurs before the first payment is due, the member account of the
member shall be treated as though death had occurred before
retirement.
' (2)(a) A life pension (nonrefund) for current service
provided by the contributions of employers, which pension,
subject to paragraph (b) of this subsection, shall be an amount
which, when added to the sum of the annuity, if any, under
subsection (1) of this section and the annuity, if any, provided
on the same basis and payable from the Variable Annuity Account,
both annuities considered on a refund basis, results in a total
of:
' (A) For service as a police officer or firefighter, two
percent of final average salary multiplied by the number of years
of membership in the system as a police officer or firefighter
before the effective date of retirement.
' (B) For service as a member of the Legislative Assembly, two
percent of final average salary multiplied by the number of years
of membership in the system as a member of the Legislative
Assembly before the effective date of retirement.
' (C) For service as other than a police officer, firefighter
or member of the Legislative Assembly, 1.67 percent of final
average salary multiplied by the number of years of membership in
the system as other than a police officer, firefighter or member
of the Legislative Assembly before the effective date of
retirement.
' (b) A pension under this subsection shall be at least:
' (A) For a member who first establishes membership in the
system before { - the effective date of this 2003 Act - } { +
July 1, 2003 + }, the actuarial equivalent of the annuity
provided by the accumulated contributions of the member. A person
establishes membership in the system before { - the effective
date of this 2003 Act - } { + July 1, 2003, + } for the
purposes of this subparagraph if:
' (i) The person is a member of the system, or a judge member
of the system, on the day immediately before { - the effective
date of this 2003 Act - } { + July 1, 2003 + }; or
' (ii) The person performed any period of service for a
participating public employer before { - the effective date of
this 2003 Act - } { + July 1, 2003, + } that is credited to the
six-month period of employment required of an employee under ORS
238.015 before an employee may become a member of the system.
' (B) For a member who made contributions before August 21,
1981, the equivalent of a pension computed pursuant to this
subsection as it existed immediately before that date.
' (c) As used in this subsection, 'number of years of
membership' means the number of full years { + of creditable
service + } plus any remaining fraction of a year { - for which
salary was paid and contributions to the Public Employees
Retirement System made - } { + of creditable service + }.
Except as otherwise provided in this paragraph, in determining a
remaining fraction a full month shall be considered as
one-twelfth of a year and a major fraction of a month shall be
considered as a full month. Membership of a school district
employee, an employee of the State Board of Higher Education
engaged in teaching or other school activity at an institution of
higher education or an employee of the Department of Human
Services, the Oregon Youth Authority, the Department of
Corrections or the State Board of Education engaged in teaching
or other school activity at an institution supervised by the
authority, board or department, for all portions of a school year
in a calendar year in which the district school, institution of
higher education or school activity at an institution so
supervised in which the member is employed is normally in session
shall be considered as a full one-half year of membership. The
number of years of membership of a member who received a refund
of contributions as provided in ORS 237.976 (2) is limited to the
number of years after the day before the date on which the refund
was received. The number of years of membership of a member who
is separated, for any reason other than death or disability, from
all service entitling the member to membership in the system, who
withdraws the amount credited to the member account of the member
in the fund during absence from such service and who thereafter
reenters the service of an employer participating in the system
but does not repay the amount so withdrawn as provided in this
chapter, is limited to the number of years after the day before
the date of so reentering.
' (3) An additional life pension (nonrefund) for prior service
credit, including military service, credited to the member at the
time of first becoming a member of the system, as elsewhere
provided in this chapter, which pension shall be provided by the
contributions of the employer.
' { + SECTION 23. + } If Senate Bill 258 becomes law, section
2, chapter 276, Oregon Laws 2003 (Enrolled Senate Bill 258), is
amended to read:
' { + Sec. 2. + } (1) An inactive member who withdraws the
account of the member under ORS 238.265 shall receive an
additional amount equal to 50 percent of the balance of the
account, to be paid from employer contributions, if:
' (a) The member was an inactive member on January 1, 2000, and
remains an inactive member until the member account is withdrawn;
' (b) The member made contributions to the Public Employees
Retirement Fund during each of five calendar years or more, and
the amounts in the member account are attributable to those
contributions; and
' (c) The withdrawal is made on or after July 1, 2004, and
before June 30, 2006.
' (2) A member who withdraws a member account under this
section may not obtain restoration under ORS 238.105 or 238.115
of the creditable service forfeited by the withdrawal.
' { + (3) In addition to an inactive member described in
subsection (1) of this section, the provisions of this section
apply to the alternate payee of a member who withdraws the
account of the alternate payee on or after July 1, 2004, and
before June 30, 2006. + }
' { + SECTION 24. + } ORS 293.706, as amended by section 3,
chapter 69, Oregon Laws 2003 (Enrolled House Bill 2005), is
amended to read:
' 293.706. (1) There is created the Oregon Investment Council,
consisting of five { + voting + } members { - , subject to
Senate confirmation in the manner provided in ORS 171.562 and
171.565 - } .
' { - (2) One member of the council shall be a person who is
appointed to serve on the Public Employees Retirement Board under
ORS 238.640 (4). - }
' { - (3) - } { + (2) + } { - Three - } { + Four + }
members, who shall be qualified by training and experience in the
field of investment or finance and who may not hold any other
public office or employment, shall be appointed by the
Governor { + , subject to Senate confirmation in the manner
provided in ORS 171.562 and 171.565 + }. One member shall be the
State Treasurer. In addition, the Director of the Public
Employees Retirement System appointed by the board shall be an ex
officio member of the council with no voting power.
' { - (4) - } { + (3) + } The term of office of each
appointed non ex officio member of the council is four years, but
each appointed member serves at the pleasure of the appointing
authority. A vacancy in the appointed membership occurring other
than by expiration of term shall be filled in the same manner as
the original appointment, but for the unexpired term only.
' { + SECTION 25. + } ORS 293.706, as amended by section 3,
chapter 69, Oregon Laws 2003 (Enrolled House Bill 2005), and
section 24 of this 2003 Act, is amended to read:
' 293.706. (1) There is created the Oregon Investment Council,
consisting of five voting members.
' { + (2) One member of the council shall be a person who is
appointed to serve on the Public Employees Retirement Board under
ORS 238.640 (4). + }
' { - (2) - } { + (3) + } { - Four - } { + Three + }
members, who shall be qualified by training and experience in the
field of investment or finance and who may not hold any other
public office or employment, shall be appointed by the Governor,
subject to Senate confirmation in the manner provided in ORS
171.562 and 171.565. One member shall be the State Treasurer. In
addition, the Director of the Public Employees Retirement System
appointed by the board shall be an ex officio member of the
council with no voting power.
' { - (3) - } { + (4) + } The term of office of each
appointed non ex officio member of the council is four years, but
each appointed member serves at the pleasure of the appointing
authority. A vacancy in the appointed membership occurring other
than by expiration of term shall be filled in the same manner as
the original appointment, but for the unexpired term only.
' { + SECTION 26. + } ORS 293.711, as amended by section 4,
chapter 69, Oregon Laws 2003 (Enrolled House Bill 2005), is
amended to read:
' 293.711. (1) A member of the Oregon Investment Council is
entitled to compensation and expenses as provided in ORS 292.495
{ - except that the member of the council who is also a member
of the Public Employees Retirement Board shall be compensated in
the manner provided in ORS 238.640 (7) - } .
' (2) The council shall select one of its members as
chairperson, for a term and with powers and duties necessary for
the performance of the functions of the office as the council
shall determine.
{ + ' SECTION 26a. The amendments to ORS 293.706 and 293.711
by sections 24 and 26 of this 2003 Act become operative on
September 1, 2003. + }
' { + SECTION 27. + } ORS 293.711, as amended by section 4,
chapter 69, Oregon Laws 2003 (Enrolled House Bill 2005), and
section 26 of this 2003 Act, is amended to read:
' 293.711. (1) A member of the Oregon Investment Council is
entitled to compensation and expenses as provided in ORS 292.495
{ + except that the member of the council who is also a member
of the Public Employees Retirement Board shall be compensated in
the manner provided in ORS 238.640 (7) + }.
' (2) The council shall select one of its members as
chairperson, for a term and with powers and duties necessary for
the performance of the functions of the office as the council
shall determine.
' { + SECTION 28. + } { + The amendments to ORS 293.706 and
293.711 by sections 25 and 27 of this 2003 Act become operative
on October 1, 2007. + }
' { + SECTION 29. + } ORS 238.660 is amended to read:
' 238.660. (1) The Public Employees Retirement Fund is declared
to be a trust fund, separate and distinct from the General Fund,
for the uses and purposes set forth in this chapter { + , section
13, chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), + }
and ORS 237.950 to 237.980, and for no other use or purpose,
except that this provision shall not be deemed to amend or impair
the force or effect of any law of this state specifically
authorizing the investment of moneys from the fund. Interest
earned by the fund shall be credited to the fund. Except as
otherwise specifically provided by law, the Public Employees
Retirement Board established by ORS 238.630 is declared to be the
trustee of the fund. Consistent with the legislative intent
expressed in ORS 238.601, and to the extent it is consistent with
the board's fiduciary duties, the board shall give equal
consideration to the interests of participating public employers
and the interests of members. Nothing in this subsection shall be
construed to impose a fiduciary duty on the board to consider the
interests of public employers, and the board shall consider the
interests of public employers only with respect to matters
unrelated to the board's fiduciary duties as trustee of the fund.
' (2) Until all liabilities to members and their beneficiaries
are satisfied, assets of the fund may not be diverted or
otherwise put to any use that is not for the exclusive benefit of
members and their beneficiaries. This subsection does not limit
return of employer contributions for health benefits in the
manner provided by ORS 238.410, 238.415 and 238.420 upon
satisfaction of all liabilities for health benefits under those
sections.
' (3) The State of Oregon and other public employers that make
contributions to the fund have no proprietary interest in the
fund or in the contributions made to the fund by them. The state
and other public employers disclaim any right to reclaim those
contributions and waive any right of reclamation they may have in
the fund. This subsection does not prohibit alteration or refund
of employer contributions if the alteration or refund is
authorized under this chapter and is due to erroneous payment or
decreased liability for employer contributions under the system.
' (4) The board may accept gifts of money or other property
from any source, given for the uses and purposes of the system.
Money so received shall be paid into the fund. Money or other
property so received shall be used for the purposes for which
received. Unless otherwise prescribed by the source from which
the money or other property is received, the money shall be
considered as income of the fund and the other property shall be
retained, managed and disposed of as are investments of the fund.
' (5) All moneys paid into the fund shall be deposited with the
State Treasurer, who shall be custodian of the fund and pay all
warrants drawn on it in compliance with law. No such warrant
shall be paid until the claim for which it is drawn is first
approved by the director or designee and otherwise audited and
verified as required by law. Monthly, each beneficiary's gross
benefit shall be calculated; applicable deductions made for
taxes, insurance and other withholdings; and the net amount paid
to the beneficiary, by check or by electronic funds transfer
(EFT) to the beneficiary's bank. A deduction summary shall be
made, by type, and a check issued for the aggregate of each type
for transmittal to the appropriate taxing jurisdiction, vendor or
institution. A voucher shall be prepared and transmitted to the
Oregon Department of Administrative Services for reimbursement of
the checking account, and the department shall draw a warrant on
the State Treasurer, payable to the Public Employees Retirement
System, for the amount thereof.
' (6) Any warrant, check or order for the payment of benefits
or refunds under the system out of the fund issued by the board
which is canceled, declared void or otherwise made unpayable
pursuant to law because it is outstanding and unpaid for a period
of more than two years, may be reissued by the board without bond
if the payee is located after such warrant, check or order is
canceled, declared void or otherwise made unpayable pursuant to
law.
' (7) All references in this chapter to checks or warrants are
subject to the provisions of ORS 291.001 (1).
' (8) The board shall provide for an annual audit of the
retirement fund and for an annual report to the Legislative
Assembly and to all members of, retirees of, and all employers
participating in, the system. The annual report must contain
financial statements prepared in accordance with generally
accepted accounting principles. The financial statements must
include the report of any independent auditor.
' { + SECTION 30. + } ORS 293.701, as amended by section 9,
chapter 6, Oregon Laws 2002 (third special session), and section
35a, chapter 67, Oregon Laws 2003 (Enrolled House Bill 2003), is
amended to read:
' 293.701. As used in ORS 293.701 to 293.820, unless the
context requires otherwise:
' (1) 'Council' means the Oregon Investment Council.
' (2) 'Investment funds' means:
' (a) Public Employees Retirement Fund referred to in ORS
238.660;
' (b) Industrial Accident Fund referred to in ORS 656.632;
' (c) Consumer and Business Services Fund referred to in ORS
705.145;
' (d) Employment Department Special Administrative Fund
referred to in ORS 657.822;
' (e) Insurance Fund referred to in ORS 278.425;
' (f) Funds under the control and administration of the
Division of State Lands;
' (g) Oregon Student Assistance Fund referred to in ORS
348.570;
' (h) Moneys made available to the Commission for the Blind
under ORS 346.270 and 346.540 or rules adopted thereunder;
' (i) Forest rehabilitation bonds sinking fund referred to in
ORS 530.280;
' (j) Oregon War Veterans' Fund referred to in ORS 407.495;
' (k) Oregon War Veterans' Bond Sinking Account referred to in
ORS 407.515;
' (L) World War II Veterans' Compensation Fund;
' (m) World War II Veterans' Bond Sinking Fund;
' (n) Savings and loan association funds in the hands of the
Director of the Department of Consumer and Business Services;
' (o) Funds in the hands of the State Treasurer that are not
required to meet current demands;
' (p) State funds that are not subject to the control and
administration of officers or bodies specifically designated by
law;
' (q) Funds derived from the sale of state bonds;
' (r) Social Security Revolving Account referred to in ORS
237.490;
' (s) Investment funds of the State Board of Higher Education
lawfully available for investment or reinvestment;
' (t) Local Government Employer Benefit Trust Fund referred to
in ORS 657.513;
' (u) Elderly and Disabled Special Transportation Fund
established by ORS 391.800;
' (v) Education Stability Fund established by ORS 348.696;
' (w) Deferred Compensation Fund established under ORS 243.411;
and
' (x) Trust for Cultural Development Account established under
ORS 359.405.
' { - (y) Transition Account Fund established by section 13a
of this 2003 Act. - }
' (3) 'Investment officer' means the State Treasurer in the
capacity as investment officer for the council.
' { + SECTION 31. + } Section 14b, chapter 67, Oregon Laws
2003 (Enrolled House Bill 2003), is amended to read:
' { + Sec. 14b. + } (1) If the Public Employees Retirement
Board is required to correct one or more of the erroneous benefit
calculation methods identified in City of Eugene et al. v. State
of Oregon, Case Nos. 99C-12794, 00C-16173, 99C-12838 and
99C-20235, the board shall recover the cost of benefits
erroneously paid to retired members as a result of those
erroneous benefit calculations by one or both of the following
methods:
' (a) The board may withhold cost of living increases under ORS
238.360 from a retired member whose benefit is greater than the
correctly calculated benefit of the member until such time as the
member's benefit is equal to the correctly calculated benefit.
' (b) The board may treat all or part of the present value of
the benefits erroneously paid and payable to retired members as a
result of the erroneous benefit calculations as an administrative
expense of the Public Employees Retirement System, to be paid
exclusively from future income of the Public Employees Retirement
Fund, and to be amortized over an actuarially reasonable period
not to exceed 15 years.
' (2) In no event may the cost of erroneous benefit calculation
methods identified in City of Eugene et dl. v. State of Oregon be
considered an employer liability or charged to employers through
employer contributions.
' { + (3) Nothing in this section creates any contract right
in any member of the Public Employees Retirement System. + }
' { + SECTION 32. + } { + Section 9, chapter 823, Oregon
Laws 2001, is repealed. + }
' { + SECTION 33. + } ORS 237.620 is amended to read:
' 237.620. (1) On or before July 1, 1973, all public employers
of police officers and firefighters who are not participants in
the Public Employees Retirement System shall become participants
in the system with respect to the police officers and
firefighters employed by them.
' (2) All police officers and firefighters in the employ of the
public employer on the date the public employer becomes a
participant in the system under subsection (1) of this section
shall establish membership under the six-month service
requirement of ORS 238.015.
' (3) The participation of the public employer in the system
under this section shall apply to services of its employee police
officers and firefighters on and after the effective date of the
public employer's participation in the system. The public
employer also shall provide a prior service pension for its
police officers and firefighters, within the limitations of ORS
238.225 (2) (1999 Edition), for continuous service to the public
employer for a period not exceeding 20 years before the effective
date of the public employer's participation in the system.
' (4) Notwithstanding subsections (1) and (2) of this section,
if a public employer provides retirement benefits to its police
officers and firefighters { - which - } { + that + } are
equal to or better than the benefits { - which - }
{ + that + } would be provided to them under the system, as
determined at the expense of the public employer by the Public
Employees Retirement Board, the public employer { - shall - }
{ + is + } not { - be - } required to participate in the
system with respect to its police officers and firefighters.
{ - This exemption shall continue to apply for only as long as
the coverage remains substantially unchanged under ORS chapter
238 but must be reexamined whenever substantial changes are made
therein. - } { + Once every two years the Public Employees
Retirement Board shall review the benefits provided by a public
employer that provides retirement benefits to its police officers
and firefighters other than through the Public Employees
Retirement System to determine whether the public employer
complies with the requirements of this subsection. + }
' { + SECTION 34. + } ORS 238.082 is amended to read:
' 238.082. (1) Subject to the limitations in subsection (2) of
this section, any public employer may employ any person receiving
a service retirement allowance if the administrative head of such
employer is satisfied that such employment is in the public
interest.
' (2) The period or periods of employment by one or more public
employers of any person receiving a service retirement allowance
{ - shall - } { + may + } not total 1,040 hours or more in any
calendar year; but if the person is receiving old-age, survivors
or disability insurance benefits under the federal Social
Security Act, the person may be employed for the number of hours
for which the salary equals the maximum allowed for receipt of
the full amount of those benefits to which the person is
entitled.
' (3) The limitations on employment imposed by subsection (2)
of this section do not apply to a retired member { - who has
attained normal retirement age and - } who is employed as a
teacher or as an administrator, as those terms are defined in ORS
342.120, if the retired member is employed by a school district
or education service district that has its administrative office
located within a county with a population of not more than 35,000
inhabitants according to the latest federal decennial census. A
retired member who is employed as a teacher, as defined in ORS
342.120, by the same public employer that employed the member at
the time of retirement remains in the same collective bargaining
unit that included the member before retirement.
' { + (4) The limitations on employment imposed by subsection
(2) of this section do not apply to a retired member who is
employed:
' (a) By the sheriff of a county with a population of fewer
than 75,000 inhabitants, according to the latest federal
decennial census;
' (b) By the municipal police department of a city with a
population of fewer than 15,000 inhabitants, according to the
latest federal decennial census;
' (c) By the state or a county for work in a correctional
institution located in a county with a population of fewer than
75,000 inhabitants, according to the latest federal decennial
census; or
' (d) By the Oregon State Police for work in a county with a
population of fewer than 75,000 inhabitants, according to the
latest federal decennial census.
' (5) The limitations on employment imposed by subsection (2)
of this section do not apply to a retired member who is employed
to temporarily replace an employee who serves in the National
Guard or in a reserve component of the Armed Forces of the United
States and who is called to federal active duty.
' (6) The limitations on employment imposed by subsection (2)
of this section do not apply to a retired member who is employed
by a road assessment district organized under ORS 371.405 to
371.535.
' (7) Subsections (3) to (6) of this section do not apply to
any member who retires under the provisions of ORS 238.280
(1). + }
' { - (4) - } { + (8) + } Employment under this section does
not affect the status of a person as a retired member of the
system and a recipient of retirement benefits under this chapter.
' { + SECTION 35. + } { + The amendments to ORS 238.082 by
section 34 of this 2003 Act apply to all retired members employed
by public employers, without regard to whether employment
commenced before, on or after the effective date of this 2003
Act. + }
' { + SECTION 36. + } ORS 238.260 is amended to read:
' 238.260. (1) The purpose of this section is to establish a
well balanced, broadly diversified investment program for certain
contributions and portions of the member accounts so as to
provide retirement benefits for members of the system that will
fluctuate as the value and earnings of the investments vary in
relation to changes in the general economy. It is anticipated
that investment of those contributions and portions of the member
accounts in equities will result in the accumulation of larger
deposit reserves for those members during their working years,
tend to preserve the purchasing power of those reserves and the
retirement benefits provided thereby and afford better protection
in periods of economic inflation.
' (2) There is established in the Public Employees Retirement
Fund an account, separate and distinct from the General Fund, to
be known as the Variable Annuity Account. Interest earned by the
account shall be credited to the account.
' (3) A member may elect at any time to have 25, 50 or 75
percent of contributions by the member to the fund on and after
the effective date of the election paid into the Variable Annuity
Account, credited to a variable account, and reserved for the
purchase of a variable annuity. A member who has elected to have
a percentage of contributions so paid, credited and reserved may
elect at any time thereafter to have an additional 25 or 50
percent of contributions by the member, but not to exceed a
maximum of 75 percent, so paid, credited and reserved. An
election shall be in writing on a form furnished by the board and
be filed with the board. An election shall be effective on
January 1 following the filing thereof.
' (4) A member who has elected to have contributions paid into
the Variable Annuity Account under subsection (3) of this section
may thereafter cause the contributions to cease being paid into
the member's variable account by filing a request in writing on a
form furnished by the board and filed with the board. The
contributions shall cease being paid into the member's variable
account after December 31 following the filing of the request.
Contributions paid into the member's variable account before the
effective date of the request for cessation shall remain in the
member's variable account.
' (5)(a) An employee who is a member of the system on January
1, 1968, and who thereafter files an election under subsection
(3) of this section, may elect at any time to have an amount
equal to 10 percent per year, for not more than five years, of
the balance of the regular account of the member in the fund on
the effective date of an election filed under subsection (3) of
this section, transferred from the regular account of the member
to the Variable Annuity Account, credited to the member's
variable account, and reserved for the purchase of a variable
annuity. An election shall be in writing on a form furnished by
the board and be filed with the board. An election is final and
irrevocable upon the filing thereof. The first transfer pursuant
to an election shall be made on July 1 following the filing of
the election, but may be made, in the discretion of the board, on
an earlier date.
' (b) If the transfers elected by a member under this
subsection have not been completed at the time of retirement, a
transfer equal to one annual transfer shall be made pursuant to
an election by the member made and filed as provided in this
subsection.
' (c) No transfer shall be made under this subsection after the
first payment of the service retirement allowance of the member
becomes normally due.
' (6) Moneys in the Variable Annuity Account may be invested in
investments authorized by law for investment of moneys in the
Public Employees Retirement Fund; but, notwithstanding any other
general or specific law, moneys in the account shall be invested
primarily in equities, including common stock, securities
convertible into common stock, real property and other recognized
forms of equities, whether or not subject to indebtedness. Not
more than five percent of the amortized value of all the
investments of the Variable Annuity Account and of moneys in the
account immediately available for investment may be invested in
the obligations of or equities in a single, primary obligor or
issuer. A pro rata share of the administrative expenses of the
system shall be paid from interest earned by the Variable Annuity
Account.
' (7)(a) Except as provided in subsection (8) of this section,
the policy-making investment authority for the Public Employees
Retirement Fund shall enter into contracts with one or more
persons whom the authority determines to be qualified, whereby
the persons undertake to invest and reinvest moneys in the
Variable Annuity Account available for investment and acquire,
retain, manage and dispose of investments of the account in
accordance with subsections (1) and (6) of this section and to
the extent provided in the contracts.
' (b) Performance of functions under contracts so entered into
shall be paid for out of the gross interest or other income of
the investments with respect to which the functions are
performed, and the net interest or other income of the
investments after that payment shall be considered income of the
Variable Annuity Account.
' (c) The policy-making investment authority may require a
person contracted with to give to the state a fidelity bond in a
penal sum as may be fixed by law or, if not so fixed, as may be
fixed by the authority, with corporate surety authorized to do
business in this state.
' (d) Contracts so entered into and functions performed
thereunder are not subject to the State Personnel Relations Law
or ORS 279.545 to 279.746.
' (e) A person contracted with shall report to the
policy-making investment authority as often as the authority may
require, but at least annually, the earnings of the moneys
invested during the period covered by the report, the capital
gains and losses of the Variable Annuity Account during the
period, the changes in the market value of the investments of the
account during the period and such other information as the
authority may require.
' (8) The policy-making investment authority for the Public
Employees Retirement Fund, for and on behalf of the Public
Employees Retirement System and Public Employees Retirement
Board, may enter into group annuity contracts with one or more
insurance companies authorized to do business in this state. In
lieu of any investment of moneys in the Variable Annuity Account
as provided in subsections (6) and (7) of this section, the
authority may pay, from time to time under contracts so entered
into, any moneys in that account available for investment
purposes. Contracts so entered into:
' (a) May provide that annuities purchased thereunder be
payable in variable dollar amounts, but if that provision is
made, provision also shall be made that a member of the system
who has a variable account, upon retiring from service and before
the first payment of retirement allowance becomes normally due,
may elect an option to have the annuities payable to the member
or the beneficiary of the member in fixed or variable dollar
amounts or both.
' (b) May provide that payment of annuities purchased
thereunder may be made by the insurance company directly to
persons entitled thereto or to the Variable Annuity Account for
payment therefrom to those persons.
' (c) Are not subject to ORS 279.545 to 279.746.
' (9) Upon retiring from service but within 60 days after the
date of the first benefit payment, a member of the system who has
a variable account may elect to transfer the balance in the
variable account to the regular account of the member, and by
that transfer the annuity shall be based on the amount in the
regular account of the member as otherwise provided in this
chapter and the member shall not receive a variable annuity as
provided in this section.
' (10) When an annuity is payable under this chapter to a
member of the system who has a variable account, or is payable to
a beneficiary of that person, the portion of the annuity payable
from the Variable Annuity Account shall be proportionately
increased or decreased for a calendar year when, as of October 31
of the preceding calendar year, the balance of the member's
variable account exceeds or is less than the current value of the
annuity, determined in accordance with the rate of interest and
approved actuarial tables then in effect.
' (11) Notwithstanding subsection (10) of this section, the
board, in the event of extraordinary fluctuation in the market
value of investments of the Variable Annuity Account and in order
to avoid substantial inequities, may increase or decrease the
portions of annuities paid from the account for periods less than
a calendar year and determined as of dates other than October 31.
' (12) Notwithstanding any other provision of this chapter, the
retirement allowance to which a member of the system who has a
variable account or who made contributions on salary in excess of
$4,800 per year during the period January 1, 1956, through
December 31, 1967, and whose effective date of retirement is
January 1, 1982, or later, is otherwise entitled under this
chapter shall be subject to the following adjustment:
' (a) The board shall determine the difference between the
member account of the member and what the member account of the
member would have been had the member not participated in the
variable annuity program on or after January 1, 1982, plus the
contributions made on salary in excess of $4,800 per year during
the period January 1, 1956, through December 31, 1967.
' (b) If the member account of the member due to participation
in the variable annuity program or due to the contributions made
on salary in excess of $4,800 per year is greater, the monthly
retirement allowance of the member shall be increased by the
value of the difference, using the annuity tables applicable to
the plan selected by the member.
' (c) If the member account of the member due to participation
in the variable annuity program or due to the contributions made
on salary in excess of $4,800 per year is lesser, the monthly
retirement allowance of the member shall be decreased by the
value of the difference, using the annuity tables applicable to
the plan selected by the member.
' (13) Except as otherwise specifically provided in this
section, the rights and benefits under this chapter of an active
or retired member of the system or of a beneficiary of the member
are not affected by this section and the provisions of this
chapter applicable to regular accounts of active and retired
members of the system in the fund are also applicable to variable
accounts.
' (14)(a) In addition to the transfer provided for in
subsection (9) of this section, a member of the system who has a
variable account may at any time prior to retirement elect to
transfer the balance in that account to the regular account of
the member in the fund if:
' (A) The member is other than a police officer or firefighter
and has attained the age of 50;
' (B) The member is a police officer or firefighter and has
attained the age of 45; or
' (C) The member has a combined total of 25 years or more of
creditable service in the system and prior service credit.
' (b) An election under paragraph (a) of this subsection is
irrevocable, and a member who has so elected may not thereafter
elect to make contributions to the Variable Annuity Account under
subsection (3) of this section.
' (c) An election under paragraph (a) of this subsection shall
be in writing and shall be filed with the board. The board by
rule shall prescribe a form for the purposes of application. An
election so made shall be effective on January 1 of the year
following the year in which the election is made { - , except
that an election shall have no effect whatsoever unless the
member account of the member as of the effective date of the
election is greater than what the member account of the member
would have been had the member not participated in the variable
annuity program on or after January 1, 1982, not including the
contributions made on salary in excess of $4,800 per year during
the period January 1, 1956, through December 31, 1967 - } .
{ + If the member account of the member as of the effective date
of the election is less than what the member account of the
member would have been had the member not participated in the
variable annuity program, not including the contributions made on
salary in excess of $4,800 per year during the period January 1,
1956, through December 31, 1967, the monthly retirement allowance
of a member calculated under ORS 238.300 (2)(a) or (b)(B) shall
be decreased by the value of the difference. + }
' (d) As of the effective date of an election under this
subsection, the board shall credit all earnings to the member's
variable account based on the actual calendar year variable
earnings rate for the year in which the election is made. This
account balance shall:
' (A) Be used by the board in determining whether the member's
election is effective under paragraph (c) of this subsection; and
' (B) Be the account balance credited by the board to the
regular account of the member in the fund if the election is
determined to be effective.
' (e) { + Subject to paragraph (c) of this subsection, + } the
annuity of a member who makes an effective transfer under this
subsection shall be based on the amount in the regular account of
the member in the fund as otherwise provided in this chapter, and
the member shall not receive a variable annuity as provided in
this section.
' { + SECTION 37. + } { + This 2003 Act being necessary for
the immediate preservation of the public peace, health and
safety, an emergency is declared to exist, and this 2003 Act
takes effect on its passage. + } ' .
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