SB 309 - This act pertains to the Public School Retirement System (PSRS) and the Nonteachers Retirement System (NTRS).

PROVISIONS APPLICABLE TO BOTH PSRS AND NTRS - The act allows the Board of Trustees to set a maximum percentage of year-to-year increase during the final average salary period.

For allowances and payments first made on or after January 1, 1998 and for all payments on or after January 1, 1999, all retirement allowances and other periodic payments made by the Board of Trustees shall be made by electronic funds transfer or such other method determined by the Board of Trustees. Each recipient shall designate a financial institution or other agent for receiving the electronic fund transfers.

Retirement options 5 and 6, for both systems, currently provide that if the member dies prior to receiving a specified number of monthly payments, the remainder of those payments shall be made to the member's beneficiary or to the member's estate. The act provides that such remainder shall be paid to the beneficiary, or to the estate of the last person to receive monthly payments.

Current law provides that if total retirement payments to the member prior to death plus subsequent payments to the member's beneficiary prior to the beneficiary's death are less than the member's contributions, then the difference shall be paid to the member's estate. The act provides that such difference shall be paid to the estate of the beneficiary or the estate of another person designated by the member at or after retirement.

Current law provides that if a member dies before receiving an allowance and the beneficiary dies before receiving an amount equal to the contributions of the member under Option 2, then the difference shall be paid to the estate of the member. The act provides that such difference shall be paid to the estate of the beneficiary.

PROVISIONS APPLICABLE TO PSRS - Certain minimum monthly benefit provisions which were supplanted by higher minimum benefits in SB 378 from 1995 are removed from the law.

Persons eligible to purchase service credit under subsection 1 of section 169.055, also known as the out of state service purchase provision, may elect to purchase such credit prior to July 1, 1998.

Current law provides for payment of an allowance in the month in which a retired member dies. The act provides that such allowance shall be paid in the month a retired member, beneficiary or survivor dies.

PROVISIONS APPLICABLE TO NTRS - Current law provides for payment of an allowance in the month in which a retired member dies. The act provides that such allowance shall be paid in the month a retired member or beneficiary dies.

The act eliminates certain deadlines regarding the election to purchase credit for service to a junior college, providing that such election may be made at any time prior to retirement.

The act allows retired NTRS members to be employed on a part-time basis by a school district and still receive benefits. Currently, retired NTRS members may only be employed on a temporary or substitute basis and still receive benefits. This provision is similar to SB 152 from 1997.

Currently, a certificated teacher employed in a position covered by NTRS may elect to be a PSRS member and receive service credit from PSRS for certificated services creditable under NTRS. The act provides that any certifcated teacher first employed after August 28, 1997 in a position covered by NTRS shall be a PSRS member and receive service credit from PSRS unless the person elects, within ninety days of such employment, to be a member of NTRS.

OTTO FAJEN