HB-4059, As Passed Senate, December 1, 2015
SENATE SUBSTITUTE FOR
HOUSE BILL NO. 4059
A bill to amend 1980 PA 300, entitled
"The public school employees retirement act of 1979,"
by amending section 61 (MCL 38.1361), as amended by 2012 PA 464.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 61. (1) Except as otherwise provided in this section, if
a retirant is receiving a retirement allowance other than a
disability allowance payable under this act or under former 1945 PA
136, on account of either age or years of personal service
performed, or both, and becomes employed by a reporting unit, the
following
shall must occur:
(a) The retirant is not entitled to a new final average
compensation or additional service credit under this retirement
system unless additional service is performed equivalent to 5 or
more years of service credit or, if the retirant has contributed to
the member investment plan, the equivalent of 3 or more years of
service credit. The retirant may elect to have the retirement
allowance recomputed based on the added credit or the final average
compensation resulting from the added service, or both. A
retirement allowance shall not be recomputed until the retirant
pays into the retirement system an amount equal to the retirant's
new final average compensation multiplied by the percentage
determined under section 41(2) for normal cost and unfunded
actuarial accrued liabilities, not including the percentage
required for the funding of health benefits, multiplied by the
total service credit in the period in which the retirant's
additional service was performed.
(b)
The retirant's retirement allowance shall must be reduced
by the lesser of the amount that the earnings in a calendar year
exceed the amount permitted without a reduction of benefits under
the
social security act, chapter 531, 49 Stat. Stat 620,
or 1/3 of
the retirant's final average compensation. For purposes of
computing allowable earnings under this subdivision, the final
average
compensation shall must be increased by 5% for each full
year of retirement.
(2) The retirement system may offset retirement benefits
payable under this act against amounts owed to the retirement
system by a retirant or retirement allowance beneficiary.
(3) Subsection (1) does not apply to a retirant if all of the
following circumstances exist:
(a) The retirant is a former teacher or administrator employed
in a teaching or research capacity by a university that is
considered a reporting unit for the limited purpose described in
section 7(3). A university that employs a retirant under this
subsection shall report that employment to the retirement system by
July 1 of each year. The university shall include in the report the
name of the retirant, the capacity in which the retirant is
employed, and the total annual compensation paid to the retirant.
(b) The retirant is not eligible to use any service or
compensation attributable to the employment described in
subdivision (a) for a recomputation of his or her retirement
allowance.
(4)
The state Not later than
April 1 of each year, the
superintendent of public instruction shall compile a listing of
critical
shortage disciplines . This listing shall be updated
annually.based on evidence of a shortage for each
discipline. The
department of education shall post the listing and the accompanying
evidence on its website. If a discipline is not included in the
listing of critical shortage disciplines, 2 or more contiguous
reporting units may submit a written request to the superintendent
of public instruction to add a discipline to the listing. The
request must include evidence of a shortage of the discipline in
those contiguous reporting units. If the superintendent of public
instruction determines that there is a shortage of the discipline
in those contiguous reporting units, the superintendent of public
instruction shall add the discipline to the listing. A discipline
added under a request under this subsection is applicable only to
those contiguous reporting units. For purposes of this subsection,
a reporting unit that is a public school academy is considered
contiguous to any other reporting unit in which the public school
academy is located.
(5)
Until July 1, 2014, 2018, subsection (1) does not apply to
a retirant if all of the following circumstances exist:
(a) The retirant is employed by a reporting unit that has a
situation, not including a situation caused by a labor dispute,
that
necessitates the hiring of a the
retirant in an area that has
been
identified by the state superintendent of public instruction
as
a critical shortage discipline pursuant to under subsection
(4).
(b) The retirant is employed under any situation described in
subdivision (a) for a period not to exceed 3 years for that
retirant.
(c) The retirant is not eligible to use any service or
compensation attributable to the employment described in
subdivision (a) for a recomputation of his or her retirement
allowance.
(d)
The reporting unit shall pay pays
100% of the contribution
rates for the unfunded actuarial accrued liability for retiree
health care and the unfunded actuarial accrued liability for
pension to the retirement system for each retirant who becomes
employed by a reporting unit under this subsection.
(6)
Subsection (5) shall only apply applies for retirants who
have been retired for at least 12 months before becoming employed
under this section.
(7) Notwithstanding any other provision of this act to the
contrary,
for a retirant who retires on or after July 1, June 30,
2010, and following a bona fide termination, including not working
House Bill No. 4059 as amended December 1, 2015
in the month of the retirant's retirement effective date, and who
becomes employed by a reporting unit and the retirant's amount of
earnings in a calendar year exceeds 1/3 of the retirant's final
average
compensation, the retirant shall forfeit forfeits his or
her retirement allowance and the retirement system subsidy for
health
care benefits from the retirement system for as long as the
entire month of each month in which the retirant is employed at the
reporting
unit unless the retirant is employed under as described
in
subsection (5), (9), <<or>> (10)<<, OR(11)>>.
A retirant who has
forfeited the
retirement system subsidy for health care benefits under this
subsection and who wants to retain health care benefits shall pay
the retirant's and retirement system's costs for the health care
benefits.
Upon termination of employment at the reporting unit, the
The retirement allowance and retirement system subsidy for health
care benefits shall resume without recalculation on the first of
the month following the month in which the retirant has terminated
reporting unit employment.
(8) Notwithstanding any other provision of this act to the
contrary,
for a retirant who retires on or after July 1, June 30,
2010, who performs core services at a reporting unit as determined
by the retirement system, but who is employed by an entity other
than the reporting unit or is an independent contractor, the
retirant
shall forfeit forfeits his or her retirement allowance and
the retirement system subsidy for health care benefits from the
retirement
system for as long as the
entire month of each month in
which the retirant is performing core services at the reporting
unit,
unless the retirant is employed under as described in
House Bill No. 4059 as amended December 1, 2015
subsection
(9), or (10), or <<(12)>>. A retirant who has forfeited the
retirement system subsidy for health care benefits under this
subsection and who wants to retain health care benefits shall pay
the retirant's and retirement system's costs for the health care
benefits.
Upon termination of services at the reporting unit, the
The retirement allowance and retirement system subsidy for health
care benefits shall resume without recalculation on the first of
the month following the month in which the retirant has terminated
performing core services, as described in this subsection.
(9)
Until July 1, 2014, 2018, subsection (1) does not apply to
a
retirant who retires on or after July 1, June 30, 2010 and on or
before September 1, 2015; who following a bona fide termination,
including not working in the month of his or her retirement
effective date, becomes employed as a substitute teacher by a
reporting unit, by an entity other than the reporting unit, or as
an independent contractor; and whose amount of earnings
attributable to employment by or at a reporting unit in a calendar
year does not exceed 1/3 of his or her final average compensation.
A retirant described in this subsection is not eligible to use any
service or compensation attributable to the employment described in
this subsection for a recomputation of his or her retirement
allowance. The reporting unit at which the retirant provides
substitute teacher services described in this subsection shall pay
100% of the contribution rates for the unfunded actuarial accrued
liability for retiree health care and the unfunded actuarial
accrued liability for pension to the retirement system for the
employment described in this subsection. The reporting unit shall
report the engagement of substitute teachers to the retirement
system at the same interval the reporting unit reports information
to the retirement system with regard to its other employees. The
reporting unit shall include in the report the name of the
substitute teacher and the total earnings paid to the substitute
teacher for that reporting period. In order to comply with the
reporting requirements of this subsection, a reporting unit that
engages substitute teachers through an entity other than a
reporting unit or as independent contractors shall obtain from the
substitute teacher's employer a list of all substitute teachers the
employer supplies to that reporting unit and the total earnings
paid to each substitute teacher for the reporting period. An
employer other than a reporting unit that employs substitute
teachers as described in this subsection shall provide to the
reporting unit all information that the reporting unit is required
to report to the retirement system under this subsection. For the
purposes of this subsection, an employer includes an independent
contractor.
(10)
Until July 1, 2014, 2018, subsection (1) does not apply
to
a retirant who retires on or after July 1, June 30, 2010 and on
or before September 1, 2015; who following a bona fide termination,
including not working in the month of his or her retirement
effective date, becomes employed as an instructional coach or a
school improvement facilitator by an entity other than the
reporting unit or as an independent contractor; and whose amount of
earnings attributable to employment at a reporting unit in a
calendar year does not exceed 1/3 of his or her final average
compensation. A retirant described in this subsection is not
eligible to use any service or compensation attributable to the
employment described in this subsection for a recomputation of his
or her retirement allowance. The reporting unit at which the
retirant provides the services described in this subsection shall
pay 100% of the contribution rates for the unfunded actuarial
accrued liability for retiree health care and the unfunded
actuarial accrued liability for pension to the retirement system
for the employment described in this subsection. The reporting unit
shall report the engagement of instructional coaches or school
improvement facilitators to the retirement system at the same
interval the reporting unit reports information to the retirement
system with regard to its other employees. The reporting unit shall
include in the report the name of the instructional coach or school
improvement facilitator and the total earnings paid to the coach or
facilitator for that reporting period. In order to comply with the
reporting requirements of this subsection, a reporting unit shall
obtain from the coach's or facilitator's employer a list of all
instructional coaches and school improvement facilitators the
employer supplies to that reporting unit and the total earnings
paid to each coach or facilitator for the reporting period. An
employer other than a reporting unit that employs instructional
coaches or school improvement facilitators as described in this
subsection shall provide to the reporting unit all information that
the reporting unit is required to report to the retirement system
under this subsection. For the purposes of this subsection, an
employer includes an independent contractor. As used in this
House Bill No. 4059 as amended December 1, 2015
subsection, "instructional coach" and "school improvement
facilitator" mean those terms as used in the listing of critical
shortage
disciplines developed by the state superintendent of
public instruction under subsection (4).
<<(11) Subsection (1) does not apply to a retirant who is
a former teacher or administrator who retires after June 30, 2010
and on or before October 1, 2014, who following a bona fide
termination, including not working in the month of his or her
retirement effective date, becomes employed in a teaching or
research capacity by a university that is considered a reporting
unit for the limited purpose described in section 7(3). A retirant
described in this subsection is not eligible to use any service or
compensation attributable to the employment described in this
subsection for recomputation of his or her retirement allowance.
The reporting unit at which the retirant provides the services
described in this subsection shall pay 100% of the contribution
rates for the unfunded actuarial accrued liability for retiree
health care and the unfunded actuarial accrued liability for
pension to the retirement system for the employment described in
this subsection. The reporting unit shall report the employment of
a retirant as described in this subsection to the retirement system
by july 1 of each year. The reporting unit shall include in the
report the name of the retirant, the capacity in which the retirant
is employed, and the total annual compensation paid to the retirant.
(12)>> Until July 1, 2018, notwithstanding any provision of this
act to the contrary, for a retirant who retires after June 30,
2010, who is employed as an independent contractor at a reporting
unit for a situation described in subsection (5)(a) or is employed
at a reporting unit for a situation described in subsection (5)(a)
by an entity other than the reporting unit, who has been retired
for at least 12 months before becoming employed under this
subsection, and whose employment under this subsection does not
exceed 3 years, the reporting unit at which the retirant provides
services under this subsection shall pay 100% of the contribution
rates for the unfunded actuarial accrued liability for retiree
health care and the unfunded actuarial accrued liability for
pension to the retirement system for the employment described in
this subsection.