S.B. 419


         Senate Bill No. 419--Senator Neal

                  April 27, 1995
                 _____________


         Referred to Committee on Finance


SUMMARY--Revises provisions governing legislators' 
          retirement. (BDR 17-78)

FISCAL NOTE:  Effect on Local Government: No.
              Effect on the State or on Industrial Insurance: 
             Yes.



EXPLANATION--Matter in italics is new; matter in bra
ckets [ ] is material to be omitted.

AN ACT relating to legislators' retirement; repealing the provisions 
        concerning limitations on benefits and contributions of the 
        Internal Revenue Code; providing for a prospective increase in 
        benefits; and providing other matters properly relating 
        thereto.

     THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE
                AND ASSEMBLY, DO ENACT AS FOLLOWS:



  Section 1.  NRS 218.238 is hereby amended to 
read as follows:
  218.238  1.  A member of the public employees' retirement 
system with service as a legislator before January 1, 1967, 
may continue such service under the public employees' 
retirement system with benefits to be calculated in the 
manner prescribed in subsection 2 or 3.
  2.  [Except as otherwise required as a result of NRS 
218.23815, benefits] \Benefits\\ must be calculated 
in the manner prescribed by NRS 286.475 unless the member 
elects to have his benefits calculated pursuant to the 
provisions of subsection 3.
  3.  [Except as otherwise required as a result of NRS 
218.23815, a] \A\\ member may elect to have his 
service as a legislator credited for retirement under 
chapter 286 of NRS as full-time service for the purpose of 
calculation of benefits at an annual gross compensation of 
$10,500. He shall, at the time of election, pay to the 
public employees' retirement fund and the public employees' 
retirement administrative fund the difference between the 
sums paid for his legislative service and the sums which 
would have been paid by him and the public employer on his 
behalf had he been in full-time service at an annual gross 
compensation of $10,500, but he is entitled to the same 
privileges of payment under the same conditions applicable 
to the repayment of previously withdrawn contributions by 
other members of the public employees' retirement system.
  4.  Service as a legislator, when accredited under the 
public employees' retirement system, will not be 
accreditable under the legislators' retirement system.
  Sec. 2.  NRS 218.2381 is hereby amended to 
read as follows:
  218.2381  1.  [Except as otherwise required as a result 
of NRS 218.23815, each] \Each\\ legislator shall be 
a member of the legislators' retirement system and shall 
make contributions to the legislators' retirement fund in 
the amounts and manner provided in NRS 218.2371 to 218.2395, 
inclusive.
  2.  Within 5 days after the commencement of each regular 
or special session of the legislature \,\\ each 
legislator who has not previously filed a beneficiary 
designation form with the board shall file with the board, 
upon a form provided by the board, the designation of a 
beneficiary who is entitled to receive the contributions of 
the legislator in case of death before retirement or 
termination of services as a legislator and subsequent 
withdrawal of contributions. If no beneficiary is 
designated, payment must be made to the estate of the 
deceased legislator. Payment may be made directly to the 
designated beneficiary without probate or administration of 
the estate of the deceased legislator.
  3.  A beneficiary may be changed at any time by written 
notice given by a legislator to the board on a form 
prescribed by the board.
  Sec. 3.  NRS 218.23831 is hereby amended to 
read as follows:
  218.23831  [Except as otherwise required as a result of 
NRS 218.23815:]
  1.  Any member of the legislators' retirement system may 
purchase all previous creditable service performed in the 
legislature if the service was performed before the creation 
of this system. The director of the legislative counsel 
bureau must certify the inclusive dates of service of the 
legislator to validate the service. The legislator must pay 
the board's actuary for a computation of costs and pay the 
full cost as determined by the actuary.
  2.  Any legislator may purchase credit for any period of 
service for which contributions were not paid while the 
legislator was receiving temporary total disability benefits 
for an industrial injury, if the injury was sustained in 
performance of his legislative duties for which 
contributions were required. The legislator must pay the 
board's actuary for any necessary computation, and must also 
pay the full actuarial costs determined by the actuary.
  3.  Any legislator who has 5 years of contributing 
creditable service may purchase up to 5 years of out-of-
state service performed with any federal, state, county or 
municipal public agency if that service is no longer 
creditable in another public retirement system. To validate 
such service, the legislator must obtain a certification of 
the inclusive dates of previous service performed with the 
other public agency, together with certification from that 
agency that his credit is no longer creditable in another 
public retirement system. Upon application to retire, the 
board shall ascertain whether or not the purchased service 
has been reestablished in any other public retirement 
system. The legislator must pay the board's actuary for the 
computation and pay the full actuarial cost as determined by 
the actuary. For the purposes of this subsection, the 
federal old-age and survivor's insurance system is not a 
"public retirement system."
  4.  Any legislator who has at least 5 years of 
contributing creditable service may purchase up to 5 years 
of military service regardless of when served if the service 
is no longer credited in the military retirement system. To 
validate military service, the legislator must provide 
certification of the inclusive dates of active military 
service performed, pay the board's actuary for the 
computation and pay the full actuarial cost as determined by 
the actuary.
  5.  Any contributing legislator may purchase previous 
service performed for any public employer which is not 
already credited in the [legislator's] 
\legislators'\\ retirement system, including 
service as an elected officer or a person appointed to an 
elective office for an unexpired term. The former public 
employer must certify the inclusive dates of employment and 
number of hours regularly worked by the legislator to 
validate such service. The legislator must pay the board's 
actuary for a computation of cost and pay the full cost as 
determined by the actuary.
  Sec. 4.  NRS 218.23835 is hereby amended to 
read as follows:
  218.23835  1.  [Except as otherwise required as a result 
of NRS 218.23815, a] \A\\ legislator who provides 
proper documentation and establishes the right to purchase 
any of the service listed in NRS 218.23831 may defer payment 
until actual retirement. Under this subsection, the purchase 
of service must be based on the full actuarial cost based 
upon the age of the member at the time of purchase. Service 
purchased under this subsection may not be credited until 
retirement. This service can be used for service retirement 
eligibility.
  2.  The legislative commission may pay any portion of the 
cost to validate service under NRS 218.23831, but is not 
required to do so. No credit may be validated unless both 
the employer and the employee contributions have been paid.
  3.  The legislator or legislative commission, or both, 
purchasing credit under NRS 218.23831 shall pay the full 
current administrative fees for each month of service 
purchased.
  Sec. 5.  NRS 218.2388 is hereby amended to 
read as follows:
  218.2388  1.  The minimum requirement for retirement is 
10 years of accredited service. A lapse in service as a 
legislator does not operate to forfeit any retirement rights 
accrued before the lapse.
  2.  A legislator who meets this requirement may retire:
  (a) At the age of 60 years or older with a full allowance.
  (b) At any age less than 60 years with an allowance or 
benefit actuarially reduced to the age of 60 years. [Except 
as otherwise required as a result of NRS 218.23815, an] 
\An\\ allowance or benefit under this paragraph 
must be reduced by 6 percent of the unmodified amount for 
each full year that the member is under the age of 60 years, 
and an additional 0.5 percent for each additional month that 
the member is under the age of 60 years. Any option selected 
must be reduced by an amount proportionate to the reduction 
provided in this subsection for the unmodified allowance or 
benefit. The board may adjust the actuarial reduction based 
upon an experience study of the \legislators' 
retirement\\ system and recommendation by the actuary.
  Sec. 6.  NRS 218.239 is hereby amended to read 
as follows:
  218.239  \1.  \\Except as otherwise required as 
a result of [NRS 218.23815,] \subsection 2,\\ a 
legislator entering into retirement on or after [July 1, 
1975,] \January 1, 1997,\\ is entitled to receive a 
monthly retirement allowance [of $25] \determined by 
multiplying 1.7 percent\\ for each year of service up to 
30 years, prorated for fractions of a year [.] \, by 
one-twelfth of 50 percent of an amount equal to the average 
of the annual gross salaries of the governor and the 
justices of the supreme court for the year in which he 
retires.
  2.  The amount of the monthly retirement allowance of a 
legislator who enters into retirement on or after January 1, 
1997, must not exceed the maximum accrued benefit allowable 
for a qualified defined benefit plan computed pursuant to 
one of the methods of accrual set forth in subparagraph (A), 
(B) or (C) of section 411(b)(1) of the Internal Revenue Code 
(26 U.S.C. § 411(b)(1)), as determined by the legislative 
commission for the year in which he retires. If the 
legislative commission determines that the provisions of 
section 411(b)(1) of the Internal Revenue Code (26 U.S.C. § 
411(b)(1)) have been so amended as to become inappropriate 
for use in Nevada or that the provisions have been repealed, 
it shall adopt methods of accrual for use pursuant to this 
section which are substantially similar to those from which 
a method was selected for the previous year.\\
  Sec. 7.  NRS 218.23815, 218.23903, 218.23905 
and 218.23908 are hereby repealed.
  Sec. 8.  This act becomes effective on January 
1, 1997.


"T                                                        T" 

                TEXT OF REPEALED SECTIONS
"T                                                        T" 

  218.23815  Limitations on benefits and 
contributions.
  1.  The election provided by section 415(b)(10)(C) of the 
Internal Revenue Code (26 U.S.C. § 415(b)(10)(C)) is hereby 
made.
  2.  Notwithstanding any other provision of law, the 
benefits payable to and the contributions made by or for the 
benefit of a legislator whose effective date of membership 
is on or after January 1, 1990, are limited pursuant to the 
provisions of sections 415(b) and 415(e) of the Internal 
Revenue Code (26 U.S.C. §§ 415(b) and 415(e)), as those 
sections existed on July 5, 1991. The provisions of section 
415(b)(2)(F) of the Internal Revenue Code (26 U.S.C. § 
415(b)(2)(F)) do not apply to the benefits of such a 
legislator.
  3.  Notwithstanding any other provision of law, if a 
legislator whose effective date of membership is on or after 
January 1, 1990, is a member of the public employees' 
retirement system and is a member of the legislators' 
retirement system, the benefits payable to him from both 
plans are limited pursuant to this section. His benefits 
from the plan providing the greater benefit must be reduced 
if the benefits from both plans exceed the limitations of 
this section.
  218.23903  Limitation on distributions to members of 
legislators' retirement system.  Notwithstanding any 
other provision of law, every distribution to a member of 
the legislators' retirement system must be made pursuant to 
the provisions of section 401(a)(9) of the Internal Revenue 
Code (26 U.S.C. § 401(a)(9)), as that section existed on 
July 5, 1991, that apply to governmental plans.
  218.23905  Limitation on compensation used to 
determine retirement benefit.  Notwithstanding any 
other provision of law, the amount of compensation used to 
determine the retirement benefit of a member of the 
legislators' retirement system must not exceed the 
limitation provided by section 401(a)(17) of the Internal 
Revenue Code (26 U.S.C. § 401(a)(17)), as that section 
existed on July 5, 1991.
  218.23908  Prohibition against applying forfeitures 
to increase benefits.  Forfeitures must not be applied 
to increase the benefits any member would otherwise receive 
pursuant to the provisions governing the legislators' 
retirement system as provided by section 401(a)(8) of the 
Internal Revenue Code (26 U.S.C. § 401(a)(8)), as that 
section existed on July 5, 1991.

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