2013 Legislative Summary
A number of INPRS-related legislative changes were approved by the 2013 Indiana General Assembly. Below is a brief summary of the legislation. You may e-mail inquiries to questions@inprs.in.gov or call PERF at (888) 526-1687 or TRF at (888) 286-3544 for more information.
SEA 228
Provides that if a PERF member dies after June 30, 2013, his or her designated beneficiary on file with PERF at the time of death will receive the benefit.
Provides that the board of the Indiana Public Retirement System (INPRS) shall elect officers annually by Dec. 31. This change replaces the current June 30 date.
PERF and TRF require a court order before we can suspend member accounts for members who have stolen money from their employers.
Requires the Pension Management Oversight Commission (PMOC) to study the Guaranteed Fund, an investment option in the Annuity Savings Account (ASA), of PERF and TRF.
Effective July 1, 2013
SEA 249
Various local retirement plans, which are not administered by PERF, have historically been required to report actuarial information to PERF. Now, these plans will be required to report this information to the State Board of Accounts.
Effective July 1, 2013
SEA 324
Provides that the death benefit for a state employee who dies in the line of duty is $100,000. This replaces the current amount of $50,000.
Surviving stepchildren are now entitled to receive a death benefit of a state employee who died in the line of duty.
Dependent children and stepchildren will receive a death benefit of a state employee who died in the line of duty.
Defines dependent as the child or stepchild that the state employee claimed on his or her federal income tax return the year before the state employee’s death.
Effective July 1, 2013
SEA 499
Defines the population of the Annuity Savings Account Only (ASA Only) plan. Provides that employers who pay employees through the Auditor of State’s office must participate in the ASA Only plan and offer this plan as an option to their employees. Provides that state employers who do not pay their employees through the Auditor of State’s office, such as quasi-governmental agencies and state universities, may decide whether they offer the ASA Only plan as an option for their employees.
Defines the population of the 401(h) medical benefits accounts. Provides that employers who pay employees through the Auditor of State’s office must participate in the 401(h) program. That means these employees must participate in 401(h). Provides that employers who do not pay employees through the Auditor of State’s office, such as quasi-governmental agencies and state universities, have the option to participate in 401(h). However, if these employers do offer this program, participation for employees is mandatory.
Effective April 12, 2013
Provides that service credit will be granted to a participant for years of service accrued before withdrawal of his or her funds from the Prosecuting Attorneys’ Retirement Fund (PARF). The requirement is that the participant must pay back the amount of money received at withdrawal plus interest, as determined by the INPRS board.
Determines a PERF pension offset amount for a participant (and the surviving spouse and dependent child of a participant) who is a member of PARF and PERF.
Effective July 1, 2013
SEA 526
Provides that members and full-time employees of the state lottery commission become members of PERF after July 1, 2013.
Eliminates second retirements for all PERF-covered positions. A member who retires and then reemploys in a PERF-covered position before July 1, 2013, may continue to earn a second retirement benefit. A member who retires and then reemploys in a PERF-covered position after July 1, 2013, may not earn a second retirement benefit.
Effective July 1, 2013
SEA 527
Requires the Pension Management Oversight Commission (PMOC) to study the Judges’ pension benefit. This includes current retirement, disability and death benefit provisions.
Effective July 1, 2013
HEA 1001
The effective date of the 401(h) medical benefits accounts is delayed by one year to July 1, 2014. These accounts, used for reimbursement of medical expenses, are for retiring state of Indiana employees.
Effective July 1, 2014
TRF’s budget for post-retirement pension increases (other operating expenses):
Fiscal year 2013-2014: $69,265,000
Fiscal year 2014-2015: $71,343,000
TRF Distributions (other operating expenses):
Fiscal year 2013-2014: $719,651,000
Fiscal year 2014-2015: 721,362,000
TRF’s pre-1996 account for post retirement pension increases and base benefits under the pre-1996 account may exceed the funds set aside to cover these expenses. If that is the case, additional funding will be provided by the State General Fund. Increases in funding will be included in the required pension stabilization calculation.
TRF’s pre-1996 account for post retirement pension increases and base benefits under the pre-1996 account may be less than the funds set aside to cover these expenses. If that is the case, the excess funds will remain in the State General Fund. The portion of the benefit funded by the annuity account and the actuarially funded post retirement pension increases will not be included in the pension stabilization calculation.
One hundred percent of excess reserves will be transferred to the Pension Stabilization Fund in calendar year 2013.
Fifty percent of excess reserves will be transferred to the Pension Stabilization Fund in calendar year 2014.
Effective July 1, 2013
HEA 1057
Provides that PARF members are required to contribute 6 percent of their salary to pay for service up to 22 years.
Provides that PARF members are immediately eligible for disability benefits. This change replaces the five years of service and receipt of the onset letter by the Social Security Administration that was previously required.
Provides that PARF members are now eligible for full retirement benefits after age 55. They must qualify for the Rule of 85, which is, at age 55, age and creditable service must total at least 85.
Provides that PARF now recognizes partial years of service as part of the benefit formula.
Provides that PARF disability benefit rates have increased to 50 to 60 percent of salary with additional years of service. This change replaces previous rates of 40 to 50 percent.
Provides that PARF survivor benefits are not subject to reduction for early retirement.
Provides that PARF members contribute a 6 percent contribution before income taxes. This change replaces the previous 6 percent after income tax contribution.
Provides an increase for the minimum annual benefit for PARF survivors. This increase to $12,000 replaces the current amount of $7,000.
Provides that a surviving spouse or children receive survivor benefits if a prosecutor dies while in office.
Provides that PARF survivor benefits will be paid out if the member has at least eight years of service.
Provides that PARF participants who become disabled will receive disability benefits. Disability benefits were previously paid to members who became disabled while in active service.
Provides that PARF members may designate a surviving spouse or one or more surviving dependent children to receive their benefit.
Effective July 1, 2013
HEA 1080
Provides that a TRF member (or survivor or beneficiary of the member) will receive a 13th check by Oct. 1, 2013. The member, who retired or was disabled on or before Dec. 1, 2012, must be entitled to receive a monthly benefit on July 1, 2013. The amount of the 13th check is as follows:
- At least five years, but less than 10 years (disability) $150
- At least 10 years, but less than 20 years $275
- At least 20 years, but less than 30 years $375
- At least 30 years $450
Provides that a PERF member (or survivor or beneficiary of the member) will receive a 13th check by Oct. 1, 2013. The member, who retired or was disabled on or before Dec. 1, 2012, must be entitled to receive a monthly benefit on July 1, 2013. The amount of the 13th check is as follows:
- At least five years, but less than 10 years (disability) $150
- At least 10 years, but less than 20 years $275
- At least 20 years, but less than 30 years $375
- At least 30 years $450
Provides that an Excise, Gaming and Conservation plan member (or a survivor or beneficiary of the member) will receive a 13th check by Oct. 1, 2013. The member, who retired or was disabled on or before Dec. 1, 2012, must be entitled to receive a monthly benefit on July 1, 2013. The amount of the 13th check is as follows:
- At least five years, but less than 10 years (disability) $125
- At least 10 years, but less than 20 years $235
- At least 20 years, but less than 30 years $325
- At least 30 years $400
Effective July 1, 2013
HEA 1148
Provides that the definition of “normal retirement” for the ASA Only plan has been reduced from 10 to five years.
A vested ASA Only plan member must be separated from employment for at least 30 days before making a withdrawal from his or her account.
Effective July 1, 2013
HEA 1561
Active 1977 Fund members can separate from one 1977 Fund participating employer to become employed with another participating 1977 Fund employer. Age limitations and physical and mental requirements for admission are waived if within 180 days after separation.
The 180 day limitation is waived for a 1977 Fund member who is eligible for reinstatement with a police or fire department following a layoff for financial reasons. Members who qualify under this provision have a 5-year period instead of the 180 day limitation.
A police officer or firefighter who has been employed as a full-time police officer or firefighter with more than one participating employer in the 1977 Fund may receive credit for all years of covered service.
Effective July 1, 2013
