(1) Every member covered under the statewide defined benefit plan established by this part 4 shall pay into the defined benefit system trust fund eight percent of salary paid or such higher member contribution rate established pursuant to section 31-31-408 (1.5)(a) or (1.6)(a). The member contribution rate shall increase by four percent to be implemented through eight annual increases as follows: Beginning in 2015, and each year thereafter through 2022, the member contribution rate shall increase by an additional one-half of one percent of base salary until the total member contribution rate, including the cumulative contribution rate increases, is twelve percent of base salary. The payment shall be made by the employer by deduction from the salary paid such member. Each employer shall pick up the member contributions required for all salaries paid after July 1, 1985, and the contributions so picked up shall be treated as employer contributions pursuant to section 414 (h)(2) of the federal "Internal Revenue Code of 1986", as amended, in determining tax treatment under such code. The employer shall pay these member contributions directly to the retirement association, instead of paying such amounts to members, and such contributions shall be paid from the same funds that are used in paying salaries to the members. Such contributions, although designated as member contributions, shall be paid by the employer in lieu of contributions by members. Members may not elect to choose to receive such contributions directly instead of having them paid by the employer to the pension plan. Member contributions so picked up shall be treated for all purposes of this article 31, other than federal tax, in the same manner as member contributions made before the date picked up. Payment shall be made by one voucher for the aggregate amount deducted and shall be made no later than ten days following the date of payment of salary to the member. All such payments shall be credited to the defined benefit system trust fund.
(2) (a) Every employer employing members who are covered by the statewide defined benefit plan established by this part 4 shall pay into the defined benefit system trust fund eight percent of the salary paid to such member or such higher employer contribution rate established pursuant to section 31-31-408 (1.6)(a), and such payment shall be made no later than ten days following the date of payment of salary to the member. The employer contribution rate shall increase by four percent to be implemented through eight annual increases as follows: Beginning in 2021, and each year thereafter through 2028, the employer contribution rate shall increase by an additional one-half of one percent of base salary until the total employer contribution rate, including the cumulative contribution rate increases, is twelve percent of base salary. All such payments shall be credited to the defined benefit system trust fund.
(b) In addition to the rate established in subsection (2)(a) of this section, the employer contribution rate shall be increased by one percent of base salary to be implemented as follows: Beginning in 2021, and continuing through 2022, or beginning in a subsequent year in the event another employer contribution rate increase is under implementation, the employer contribution rate shall increase by an additional one-half of one percent of base salary in each year for a total of a one percent increase in order to pay for the cost of the benefit established in section 31-31403 (4)(b).
The general assembly declares that the rates of member and employer contributionsshall be adequate to fund benefit liabilities accrued under the statewide defined benefit plan established by this part 4, and to this end, the board shall submit an annual actuarial valuation report to the state auditor, the legislative audit committee, and the joint budget committee of the general assembly, together with any recommendations concerning such liabilities as accrued. Amortization of such liability over a forty-year period shall be deemed adequate to maintain actuarial stability. If the actual financial experience of the new hire benefits account in the defined benefit system trust fund is found to be more or less favorable than the assumed experience during the two-year period from January 1, 1980, and each biennium thereafter, adjustments may be made by the board in the member and employer contributions as may be deemed feasible and advisable so long as the employer contribution rate adjustment is equal to the member contribution rate adjustment. If the member contribution rate has been increased pursuant to section 31-31-408 (1.5)(a), the requirement that the employer contribution rate be at least equal to the member contribution rate shall not apply, but in such circumstance, any increase to the employer contribution rate shall be at least equal to the increase in the member contribution rate and any decrease in the member contribution rate shall be at least equal to the decrease in the employer contribution rate.
The payments required by this section are subject to interest if not submitted whendue. Payments are due no later than ten days following the date of payment of salary to the member.
(a) There shall be established in the defined benefit system trust fund a new hire benefits account into which contributions made pursuant to this section shall be deposited. The benefits provided by the statewide defined benefit plan established in part 4 of this article, together with the expenses of administering the plan, shall be paid from such account.
(b) Defined benefit assets of the statewide defined benefit plan shall be administered within the fire and police members' benefit investment fund and assets of the of the plan designated for self direction shall be administered within the fire and police members' selfdirected investment fund.
Source: L. 96: Entire article added with relocations, p. 903, § 1, effective May 23. L. 2000: (1) amended, p. 1865, § 89, effective August 2; (4) amended, p. 45, § 1, effective August
2. L. 2006: (1), (2), and (3) amended and (5) added, p. 189, § 14, effective March 31. L. 2007:
(1), (2), and (4) amended, p. 273, § 1, effective August 3. L. 2010: (1) and (3) amended, (SB 10022), ch. 18, p. 82, § 1, effective August 11. L. 2015: (4) amended, (SB 15-027), ch. 9, p. 20, § 2, effective August 5. L. 2020: (1), (2), and (3) amended, (HB 20-1044), ch. 105, p. 405, § 2, effective September 14.
Editor's note: This section was formerly numbered as § 31-30-1013.
Cross references: For the federal "Internal Revenue Code of 1986", see title 26 of the United States Code.