Chapter 988 Oregon Laws 1999

Session Law

AN ACT

SB 328

Relating to public employee retirement.

Be It Enacted by the People of the State of Oregon:

SECTION 1. Section 2 of this 1999 Act is added to and made a part of ORS chapter 238.

SECTION 2. (1) The Public Employees Retirement Board may, at its discretion, accept rollover contributions from an active member. The board may accept rollover contributions under this section only if the amounts contributed qualify for pretax rollover treatment under the federal income tax laws governing qualified retirement plans.

(2) If the board accepts a rollover contribution under this section, the contribution shall be paid into the Public Employees Retirement Fund and credited to an individual rollover account in the name of the member who made the contribution. The rollover account must be kept separate from the individual account maintained for the employee under ORS 238.250 and any account maintained for the employee in the Variable Annuity Account under ORS 238.260, and must be invested separately from all other moneys in the Public Employees Retirement Fund. All earnings on the rollover account shall be credited by the board to the rollover account. If the membership of the employee in the Public Employees Retirement System is terminated under the provisions of ORS 238.095, the board shall cease investment of the amounts in the rollover account and, after the effective date of the termination, shall no longer credit earnings and losses to the rollover account.

(3) Except as provided in subsection (2) of this section, amounts in a rollover account established under this section shall be invested in the same manner as funds in the individual account maintained for an employee under ORS 238.250. However, ORS 238.255 does not apply to rollover accounts.

(4) Rollover contributions shall not be considered in determining whether a member has contributed in each of five calendar years for purposes of ORS 238.265 and 238.425 or for the purpose of any other provision in this chapter relating to employee contributions.

(5) Amounts held in a rollover account under this section shall be distributed to the member within 90 days after the member's effective date of retirement under this chapter, or within 90 days after termination of the person's membership in the system under ORS 238.095.

(6) Distribution from a member's rollover account shall be made in a single lump sum payment. Distribution from a member's rollover account shall not affect the calculation of any other service or disability retirement allowance, death benefit or other benefit payable to a member under this chapter.

(7) The board shall adopt rules and establish procedures for determining whether a member will be allowed to make a rollover contribution under this section. Rules and procedures adopted by the board must ensure that the rollover contributions do not adversely affect the status of the system and the Public Employees Retirement Fund as a qualified governmental plan and trust under federal income tax law.

(8) The board shall by rule establish a maintenance fee for rollover accounts established under this section. The fee may be collected out of earnings on rollover accounts or, if there are no earnings, from the principal amounts paid into the 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 rollover accounts under this section.

SECTION 3. Section 2 of this 1999 Act becomes operative July 1, 2002.

Approved by the Governor August 20, 1999

Filed in the office of Secretary of State August 23, 1999

Effective date October 23, 1999

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