Bill Text: IN SB0549 | 2011 | Regular Session | Amended
Bill Title: Indiana public retirement system.
Spectrum: Partisan Bill (Republican 4-0)
Status: (Passed) 2011-05-18 - Effective 07/01/2011 [SB0549 Detail]
Download: Indiana-2011-SB0549-Amended.html
Citations Affected: IC 2-3.5; IC 4-2; IC 5-10; IC 5-10.2; IC 5-10.3;
IC 5-10.4; IC 5-10.5; IC 33-38; IC 33-39; IC 36-8; noncode.
Young R Michael
January 20, 2011, read first time and referred to Committee on Pensions and Labor.
January 27, 2011, amended, reported favorably _ Do Pass.
February 7, 2011, read second time, amended, ordered engrossed.
Digest Continued
treasurer of state: the treasurer of state or an individual with experience in economics, finance, or investments. Requires that initial appointments to the board give a preference for those individuals who, on June 30, 2011, are serving as trustees of PERF and TRF, and provides that a PERF or TRF trustee appointed to the board serves until the trustee's term would have expired under prior law. Provides for a four year term for trustees. Provides that a trustee is strongly encouraged to complete annually at least 12 hours of trustee education. Provides that five trustees constitute a quorum and requires a majority vote of the trustees present in order for the board to adopt a resolution or take other action at a regular or special meeting. Requires the system's chief investment officer and the officer's staff to file annual financial disclosure statements with the inspector general. Provides that the board's powers and duties are the combined powers and duties of the PERF and TRF boards. Provides that each retirement fund continues as a separate fund managed by the board. Provides for a director of the system who is appointed by and serves at the pleasure of the board. Provides that employees of PERF and TRF remain members of those funds. Provides that new hires of the system become PERF members, unless the director expressly determines otherwise. Allows the board to establish contribution rate groups for PERF, and removes the requirement that each employer have a separate account within the retirement allowance account. Eliminates the 1977 Fund advisory committee. Authorizes the board to adopt rules without complying with IC 4-22-2 in establishing impairment standards, a list of excludable medical conditions, and standards and tests for the baseline statewide physical examination for the 1977 Fund. Repeals provisions that establish the PERF and TRF boards and require PERF and TRF to hire a common director. Repeals corresponding definitions and cross-references.
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or
A BILL FOR AN ACT to amend the Indiana Code concerning
pensions.
(b) References in this article to the PERF board or TRF board shall be considered after June 30, 2011, to be references to the board of trustees of the Indiana public retirement system established by IC 5-10.5-3-1.
(1) The governor, lieutenant governor, secretary of state, auditor of state, treasurer of state, attorney general, and state superintendent of public instruction.
(2) Any candidate for one (1) of the offices in subdivision (1) who is not the holder of one (1) of those offices.
(3) Any person who is the appointing authority of an agency.
(4) The director of each division of the department of administration.
(5) Any purchasing agent within the procurement division of the department of administration.
(6) Any agency employee, special state appointee, former agency employee, or former special state appointee with final purchasing authority.
(7) The chief investment officer employed by the Indiana public retirement system.
(8) Any employee of the Indiana public retirement system whose duties include the recommendation, selection, and management of:
(A) the investments of the funds administered by the Indiana public retirement system;
(B) the investment options offered in the annuity savings accounts in the public employees' retirement fund and the Indiana state teachers' retirement fund;
(C) the investment options offered in the legislators' defined contribution plan; or
(D) investment managers, investment advisors, and other investment service providers of the Indiana public retirement system.
(b) The statement shall be filed with the inspector general as follows:
(1) Not later than February 1 of every year, in the case of the state officers and employees enumerated in subsection (a).
(2) If the individual has not previously filed under subdivision (1) during the present calendar year and is filing as a candidate for a state office listed in subsection (a)(1), before filing a declaration of candidacy under IC 3-8-2 or IC 3-8-4-11, petition of nomination under IC 3-8-6, or declaration of intent to be a write-in candidate under IC 3-8-2-2.5, or before a certificate of nomination is filed under IC 3-8-7-8, in the case of a candidate for one (1) of the state offices (unless the statement has already been filed when required under IC 3-8-4-11).
(3) Not later than sixty (60) days after employment or taking office, unless the previous employment or office required the
filing of a statement under this section.
(4) Not later than thirty (30) days after leaving employment or
office, unless the subsequent employment or office requires the
filing of a statement under this section.
The statement must be made under affirmation.
(c) The statement shall set forth the following information for the
preceding calendar year or, in the case of a state officer or employee
who leaves office or employment, the period since a previous statement
was filed:
(1) The name and address of any person known:
(A) to have a business relationship with the agency of the state
officer or employee or the office sought by the candidate; and
(B) from whom the state officer, candidate, or the employee,
or that individual's spouse or unemancipated children received
a gift or gifts having a total fair market value in excess of one
hundred dollars ($100).
(2) The location of all real property in which the state officer,
candidate, or the employee or that individual's spouse or
unemancipated children has an equitable or legal interest either
amounting to five thousand dollars ($5,000) or more or
comprising ten percent (10%) of the state officer's, candidate's, or
the employee's net worth or the net worth of that individual's
spouse or unemancipated children. An individual's primary
personal residence need not be listed, unless it also serves as
income property.
(3) The names and the nature of the business of the employers of
the state officer, candidate, or the employee and that individual's
spouse.
(4) The following information about any sole proprietorship
owned or professional practice operated by the state officer,
candidate, or the employee or that individual's spouse:
(A) The name of the sole proprietorship or professional
practice.
(B) The nature of the business.
(C) Whether any clients are known to have had a business
relationship with the agency of the state officer or employee or
the office sought by the candidate.
(D) The name of any client or customer from whom the state
officer, candidate, employee, or that individual's spouse
received more than thirty-three percent (33%) of the state
officer's, candidate's, employee's, or that individual's spouse's
nonstate income in a year.
(5) The name of any partnership of which the state officer, candidate, or the employee or that individual's spouse is a member and the nature of the partnership's business.
(6) The name of any corporation (other than a church) of which the state officer, candidate, or the employee or that individual's spouse is an officer or a director and the nature of the corporation's business.
(7) The name of any corporation in which the state officer, candidate, or the employee or that individual's spouse or unemancipated children own stock or stock options having a fair market value in excess of ten thousand dollars ($10,000). However, if the stock is held in a blind trust, the name of the administrator of the trust must be disclosed on the statement instead of the name of the corporation. A time or demand deposit in a financial institution or insurance policy need not be listed.
(8) The name and address of the most recent former employer.
(9) Additional information that the person making the disclosure chooses to include.
Any such state officer, candidate, or employee may file an amended statement upon discovery of additional information required to be reported.
(d) A person who:
(1) fails to file a statement required by rule or this section in a timely manner; or
(2) files a deficient statement;
upon a majority vote of the commission, is subject to a civil penalty at a rate of not more than ten dollars ($10) for each day the statement remains delinquent or deficient. The maximum penalty under this subsection is one thousand dollars ($1,000).
(e) A person who intentionally or knowingly files a false statement commits a Class A infraction.
(1) "Board" refers to the board of trustees of the Indiana public retirement system established by IC 5-10.5-3-1.
or any gaming control officer.
(d) (5) "Participant" means any officer who has elected to
participate in the retirement plan created by this chapter.
(e) (6) "Salary" means the total compensation, exclusive of
expense allowances, paid to any officer by the department or the
commission, determined without regard to any salary reduction
agreement established under Section 125 of the Internal Revenue
Code.
(f) (7) "Average annual salary" means the average annual salary
of an officer during the five (5) years of highest annual salary in
the ten (10) years immediately preceding an officer's retirement
date, determined without regard to any salary reduction agreement
established under Section 125 of the Internal Revenue Code.
(g) (8) "Public employees' retirement act" means IC 5-10.3.
(h) (9) "Public employees' retirement fund" means the public
employees' retirement fund created by IC 5-10.3-2.
(i) (10) "Interest" means the same rate of interest as is specified
under the public employees' retirement law.
(j) (11) "Americans with Disabilities Act" refers to the Americans
with Disabilities Act (42 U.S.C. 12101 et seq.) and any
amendments and regulations related to the Act.
(k) (12) Other words and phrases when used in this chapter shall,
for the purposes of this chapter, have the meanings respectively
ascribed to them as set forth in IC 5-10.3-1.
(b) Records of individual participants in the retirement plan created by this chapter and participants' information are confidential, except for the name and years of service of a retirement plan participant.
(b) As used in this section, "public retirement fund" refers collectively to:
(1) the public employees' retirement fund (IC 5-10.3);
(2) the Indiana state teachers' retirement fund (IC 5-10.4);
(3) the state police pension trust (IC 10-12); and
(4) the 1977 police officers' and firefighters' pension and disability fund (IC 36-8-8).
(c) Subject to this section, a participant may purchase service credit for the participant's prior service in a position covered by a public retirement fund.
(d) To purchase the service credit described in subsection (c), a participant must meet the following requirements:
(1) The participant has at least one (1) year of creditable service in the retirement plan created by this chapter.
(2) The participant has not attained vested status in and is not an active participant in the public retirement fund from which the participant is purchasing the service credit.
(3) Before the participant retires, the participant makes contributions to the retirement plan created by this chapter as follows:
(A) Contributions that are equal to the product of the following:
(i) The participant's salary at the time the participant actually makes a contribution for the service credit.
(ii) A rate, determined by the actuary for the retirement plan created by this chapter, based on the age of the participant at the time the participant actually makes a contribution for service credit and computed to result in a contribution amount that approximates the actuarial present value of the benefit attributable to the service credit purchased.
(iii) The number of years of service credit the participant intends to purchase.
(B) Contributions for any accrued interest, at a rate determined by the actuary for the retirement plan created by this chapter, for the period from the participant's initial participation in the retirement plan created by this chapter to the date payment is made by the participant.
(e) At the request of the participant purchasing service credit under this section, the amount a participant is required to contribute under subsection (d)(3) may be reduced by a trustee to trustee transfer from a public retirement fund in which the participant has an account that contains amounts attributable to member contributions (plus any credited earnings) to the retirement plan created by this chapter. The participant may direct the transfer of an amount only to the extent necessary to fund the service purchase under subsection (d)(3). The participant shall complete any forms required by the public retirement
fund from which the participant is requesting a transfer or the
retirement plan created by this chapter before the transfer is made.
(f) At least ten (10) years of service in the retirement plan created
by this chapter is required before a participant may receive a benefit
based on service credit purchased under this section.
(g) A participant who:
(1) terminates employment before satisfying the eligibility
requirements necessary to receive an annual retirement
allowance; or
(2) receives an annual retirement allowance for the same service
from another tax supported governmental retirement plan other
than under the federal Social Security Act;
may withdraw the purchase amount plus accumulated interest after
submitting a properly completed application for a refund to the
retirement plan created by this chapter.
(h) The following may apply to the purchase of service credit under
this section:
(1) The board may allow a participant to make periodic payments
of the contributions required for the purchase of the service credit.
The board shall determine the length of the period during which
the payments must be made.
(2) The board may deny an application for the purchase of service
credit if the purchase would exceed the limitations under Section
415 of the Internal Revenue Code.
(3) A participant may not claim the service credit for purposes of
determining eligibility for a benefit or computing benefits unless
the participant has made all payments required for the purchase
of the service credit.
(i) To the extent permitted by the Internal Revenue Code and
applicable regulations, the retirement plan created by this chapter may
accept, on behalf of a participant who is purchasing permissive service
credit under this chapter, a rollover of a distribution from any of the
following:
(1) A qualified plan described in Section 401(a) or Section 403(a)
of the Internal Revenue Code.
(2) An annuity contract or account described in Section 403(b) of
the Internal Revenue Code.
(3) An eligible plan that is maintained by a state, a political
subdivision of a state, or an agency or instrumentality of a state or
political subdivision of a state under Section 457(b) of the
Internal Revenue Code.
(4) An individual retirement account or annuity described in
Section 408(a) or Section 408(b) of the Internal Revenue Code.
(j) To the extent permitted by the Internal Revenue Code and
applicable regulations, the retirement plan created by this chapter may
accept, on behalf of a participant who is purchasing permissive service
credit under this chapter, a trustee to trustee transfer from any of the
following:
(1) An annuity contract or account described in Section 403(b) of
the Internal Revenue Code.
(2) An eligible deferred compensation plan under Section 457(b)
of the Internal Revenue Code.
(b)
1995, retirement, disability, and survivor benefits for the public
employees of the political subdivision independent of this article if the
political subdivision took action before January 1, 1995, and was not
a participant in the public employees' retirement fund on January 1,
1995, under this article or IC 5-10.3.
(1) The annuity savings account.
(2) The retirement allowance account.
(b) The board
(1) The pre-1996 account.
(2) The 1996 account.
(c) Within each account specified in subsection (b), the board
(1) The annuity savings account.
(2) The retirement allowance account.
(b) The retirement allowance account of the pre-1996 account consists of the pre-1996 account, exclusive of the annuity savings account.
(c) The retirement allowance account of the 1996 account consists of the 1996 account, exclusive of the annuity savings account.
(1) the normal contribution for
(2) the rate of normal contribution;
(3) the unfunded accrued liability of the public employees' retirement fund, the pre-1996 account, and the 1996 account, which is the excess of total accrued liability over the fund's or account's total assets, respectively; and
(4) the
(b) Based on the information in subsection (a), each board may determine, in its sole discretion, contributions and contribution rates for individual employers or for a group of employers.
(c) The board's determinations under subsection (a):
(1) are subject to sections 1.5 and 11.5 of this chapter; and
(2) for an employer making a contribution to the Indiana state teachers' retirement fund, may not include an amount for a retired member of the Indiana state teachers' retirement fund for whom the employer may not make contributions during the member's period of reemployment as provided under IC 5-10.2-4-8(d).
board of trustees of the Indiana public retirement system established by IC 5-10.5-3-1.
board of trustees of the Indiana public retirement system established by IC 5-10.5-3-1.
(b) The fund is a trust. The board of trustees of the
the fund; and
(2) the actuary for the fund finds there would be no material
change in the current or continued employer contribution rate for
that unit because of the additional classification.
JULY 1, 2011]: Sec. 5. "Board" refers to the board of trustees of the
Indiana state teachers' retirement fund. Indiana public retirement
system established by IC 5-10.5-3-1.
ARTICLE 10.5. INDIANA PUBLIC PENSION MODERNIZATION ACT
Chapter 1. Definitions
Sec. 1. The definitions in this chapter apply throughout this article.
Sec. 2. "Board" refers to the board of trustees of the system established by IC 5-10.5-3-1.
Sec. 3. "Director" refers to the director of the system.
Sec. 4. "Public employees' retirement fund" means the public employees' retirement fund established under IC 5-10.2 and IC 5-10.3.
Sec. 5. "Public pension and retirement funds of the system" means the public pension and retirement funds listed in IC 5-10.5-2-2.
Sec. 6. "System" refers to the Indiana public retirement system established by IC 5-10.5-2-1.
Sec. 7. "Teachers' retirement fund" means the Indiana state teachers' retirement fund established under IC 5-10.2 and IC 5-10.4.
Chapter 2. Indiana Public Retirement System
Sec. 1. On July 1, 2011, the Indiana public retirement system is established.
Sec. 2. The system consists of the following public pension or retirement funds:
(1) The public employees' retirement fund established under IC 5-10.2 and IC 5-10.3.
(2) The Indiana state teachers' retirement fund established under IC 5-10.2 and IC 5-10.4.
(3) The Indiana judges' retirement fund established under IC 33-38-6.
(4) The prosecuting attorneys retirement fund established under IC 33-39-7.
(5) The state excise police, gaming agent, gaming control officer, and conservation enforcement officers' retirement fund established under IC 5-10-5.5.
(6) The 1977 police officers' and firefighters' pension and
disability fund established under IC 36-8-8.
(7) The legislators' retirement system established under
IC 2-3.5.
(8) The pension relief fund established under IC 5-10.3-11.
(9) The special death benefit fund established under
IC 5-10-10.
(10) The state employees' death benefit fund established under
IC 5-10-11.
Sec. 3. The system is an independent body corporate and politic.
The system is not a department or agency of the state but is an
independent instrumentality exercising essential government
functions.
Sec. 4. For purposes of IC 34-13-2, IC 34-13-3, and IC 34-13-4,
the board, the system, and all employees of the board or the system
are public employees (as defined in IC 34-6-2-38). All employees of
the board or a fund administered by the board who are employed
within a classification covered by a labor agreement to which the
state is a party shall continue to remain subject to the terms and
conditions of that agreement and any successor labor agreements
entered into by the state.
Sec. 5. The system shall be managed and administered by a
board of trustees established under IC 5-10.5-3.
Sec. 6. Each public pension or retirement fund listed in section
2 of this chapter is a separate fund managed by the board under
this article and the retirement law applicable to the public pension
or retirement fund. The obligations of the state and political
subdivisions for benefit payments are specified in the retirement
law applicable to each public pension or retirement fund.
Chapter 3. Board of Trustees
Sec. 1. (a) The board of trustees of the Indiana public retirement
system is established.
(b) The board shall manage and administer each public pension
or retirement fund that comprises the system in accordance with:
(1) this article; and
(2) the retirement law applicable to the public pension or
retirement fund.
Sec. 2. (a) The board is composed of nine (9) trustees appointed
by the governor as follows:
(1) At least one (1) trustee must have experience in economics,
finance, or investments.
(2) At least one (1) trustee must have experience in executive
management or benefits administration.
(3) The director of the budget agency or the budget agency director's designee serving as an ex officio voting member of the board. An individual appointed under this subdivision to serve as the budget agency director's designee:
(A) is subject to section 5 of this chapter; and
(B) serves as a permanent designee until replaced by the budget agency director.
(4) Two (2) trustees nominated by the speaker of the house of representatives as follows:
(A) One (1) must be an active or retired police officer or firefighter who is a member of the 1977 police officers' and firefighters' pension and disability fund.
(B) One (1) must be a member of the teachers' retirement fund with at least ten (10) years of creditable service.
(5) Two (2) trustees nominated by the president pro tempore of the senate as follows:
(A) One (1) must be a member of the public employees' retirement fund with at least ten (10) years of creditable service.
(B) One (1) must be a member of the teachers' retirement fund with at least ten (10) years of creditable service.
(6) One (1) trustee nominated by the auditor of state. The individual nominated under this subdivision may be the auditor of state or another individual who has experience in professional financial accounting or actuarial science.
(7) One (1) trustee nominated by the treasurer of state. The individual nominated under this subdivision may be the treasurer of state or another individual who has experience in economics, finance, or investments.
(b) If a vacancy on the board occurs, the governor shall, not later than forty-five (45) days after the date the vacancy occurs, appoint an individual to fill the vacancy using the criteria in subsection (a).
(c) During the first year after an individual's initial appointment as a trustee and each year thereafter during which the individual serves as a trustee, the individual is strongly encouraged to complete at least twelve (12) hours of trustee education, at least two (2) hours in each of the following areas:
(1) Fiduciary duties and responsibilities of a trustee.
(2) Ethics.
(3) Governance process and procedures.
(4) Retirement plan design and administration.
(5) Investments.
(6) Actuarial principles and methods.
(d) Subject to the director's approval, each trustee is entitled to reimbursement for reasonable expenses actually incurred in fulfilling the educational requirements under subsection (c). The director shall give a preference for reimbursement for in-state training that meets the requirements under subsection (c), if in-state training is available.
Sec. 3. (a) A trustee shall serve a term of four (4) years, beginning on July 1 following the trustee's appointment.
(b) Whenever a trustee is appointed to fill a vacancy caused by death or resignation, the trustee shall serve the unexpired term of the trustee's predecessor.
(c) A trustee shall serve until the trustee's successor is appointed and qualified.
Sec. 4. (a) In making the initial appointments to the board under section 2(a) of this chapter, the governor shall do the following:
(1) Appoint individuals to the initial terms of office under section 2 of this chapter not later than July 15, 2011.
(2) In making appointments under subdivision (1), give a preference for appointment, consistent with the criteria in section 2(a) of this chapter, to those individuals who, on June 30, 2011, are serving as trustees of the public employees' retirement fund and the teachers' retirement fund.
(b) A trustee appointed under subsection (a)(2) shall serve until the trustee's term would have expired under IC 5-10.3-3-2 (repealed) and IC 5-10.4-3-2 (repealed).
(c) The initial terms of office for the individuals appointed under subsection (a) begin July 1, 2011.
(d) This section expires January 1, 2016.
Sec. 5. (a) Each trustee shall take an oath of office. The oath must be:
(1) subscribed to by the trustee making the oath;
(2) certified by the officer before whom the trustee takes the oath; and
(3) filed with the secretary of state.
(b) A trustee is qualified for membership on the board when the trustee's oath is filed with the secretary of state.
Sec. 6. (a) Each trustee is entitled to reimbursement for necessary expenses actually incurred through service on the board.
(b) Trustee expenses shall be paid from fund assets.
Sec. 7. (a) Not later than June 30 each year, the board shall elect
a chair and vice chair from its members to serve as the officers of
the board.
(b) An officer shall serve for one (1) year or until the officer's
successor is elected and qualified.
Sec. 8. (a) The board shall hold regular meetings at least
quarterly.
(b) The board may hold special meetings:
(1) at the call of the chair; or
(2) with a written request signed by at least five (5) trustees.
(c) The board may hold its meetings at the system's general
offices or at any other place in Indiana that the board designates.
(d) All meetings must be open to the public in accordance with
IC 5-14-1.5.
(e) The board shall keep a record of its proceedings.
Sec. 9. (a) This section applies to any meeting of the board.
(b) A member of the board may participate in a meeting of the
board using any means of communication that permits:
(1) all other board members participating in the meeting; and
(2) all members of the public physically present at the place
where the meeting is conducted;
to simultaneously communicate with the member during the
meeting.
(c) A member of the board who participates in a meeting under
subsection (b) is considered to be present at the meeting.
(d) The memorandum of the meeting prepared under
IC 5-14-1.5-4 must also state the name of each member who:
(1) was physically present at the place where the meeting was
conducted;
(2) participated in the meeting using a means of
communication described in subsection (b); or
(3) was absent.
Sec. 10. (a) Five (5) trustees constitute a quorum for the
transaction of business.
(b) Each trustee is entitled to one (1) vote.
(c) A majority vote of the trustees present is required for the
board to adopt a resolution or take other action at a regular or
special meeting.
Chapter 4. Board Powers and Duties
Sec. 1. The board shall do all of the following:
(1) Appoint and fix the salary of a director.
(2) Employ or contract with employees, auditors, technical
experts, legal counsel, and other service providers as the
board considers necessary to transact the business of the fund
without the approval of any state officer, and fix the
compensation of those persons.
(3) Establish a general office in Indianapolis for board
meetings and for administrative personnel.
(4) Provide for the installation in the general office of a
complete system of:
(A) books;
(B) accounts, including reserve accounts; and
(C) records;
to give effect to all the requirements of this article and to
ensure the proper operation of the fund.
(5) Provide for a report at least annually to each member of
the amount credited to the member in the annuity savings
account in each investment program under IC 5-10.2-2.
(6) With the advice of the actuary, adopt actuarial tables and
compile data needed for actuarial studies that are necessary
for the fund's operation.
(7) Act on applications for benefits and claims of error filed
by members.
(8) Have the accounts of the fund audited annually by the
state board of accounts, and if the board determines that it is
advisable, have the operation of a public pension or
retirement fund of the system audited by a certified public
accountant.
(9) Publish for the members a synopsis of the fund's condition.
(10) Adopt a budget on a calendar year or fiscal year basis
that is sufficient, as determined by the board, to perform the
board's duties and, as appropriate and reasonable, draw upon
fund assets to fund the budget.
(11) Expend money, including income from the fund's
investments, for effectuating the fund's purposes.
(12) Establish personnel programs and policies for the
employees of the system.
(13) Submit a financial report before November 1 each year
to the governor, the pension management oversight
commission, and the budget committee. The report under this
subdivision must set forth a complete operating and financial
statement covering its operations during the most recent fiscal
year, and include any other information requested by the
chair of the pension management oversight commission. The
report must be submitted to the pension management
oversight commission in an electronic format pursuant to
IC 5-14-6.
(14) Establish a code of ethics or decide to be under the
jurisdiction and rules adopted by the state ethics commission.
(15) Provide the necessary forms for administering the fund.
(16) Submit to the auditor of state or the treasurer of state
vouchers or reports necessary to claim an amount due from
the state to the system.
Sec. 2. (a) The board may do any of the following:
(1) Establish and amend rules and regulations:
(A) for the administration and regulation of the fund and
the board's affairs; and
(B) to effectuate the powers and purposes of the board;
without adopting a rule under IC 4-22-2.
(2) Make contracts and sue and be sued as the board of
trustees of the Indiana public retirement system.
(3) Delegate duties to its employees.
(4) Enter into agreements with one (1) or more insurance
companies to provide life, hospitalization, surgical, medical,
dental, vision, long term care, or supplemental Medicare
insurance, utilizing individual or group insurance policies for
retired members of the fund, and, upon authorization of the
respective member, deduct premium payments for such
policies from the members' retirement benefits and remit the
payments to the insurance companies.
(5) Enter into agreements with one (1) or more insurance
companies to provide annuities for retired members of the
fund, and, upon a member's authorization, transfer the
amount credited to the member in the annuity savings
account to the insurance companies.
(6) For the 1977 police officers' and firefighters' pension and
disability fund, deduct from benefits paid and remit to the
appropriate entities amounts authorized by IC 36-8-8-17.2.
(7) Whenever the fund's membership is sufficiently large for
actuarial valuation, establish an employer's contribution rate
for all employers, including employers with special benefit
provisions for certain employees.
(8) Amortize prior service liability over a period of forty (40)
years or less.
(9) Recover payments made under false or fraudulent
representation.
(10) Give bond for an employee for the fund's protection.
(11) Receive the state's share of the cost of the pension
contribution from the federal government for a member on
leave of absence in order to work in a federally supported
educational project.
(12) Summon and examine witnesses when adjusting claims.
(13) When adjusting disability claims, require medical
examinations by doctors approved or appointed by the board.
Not more than two (2) examinations may be conducted in one
(1) year.
(14) Conduct investigations to help determine the merit of a
claim.
(15) Meet an emergency that may arise in the administration
of the board's trust.
(16) Determine other matters regarding the board's trust that
are not specified.
(17) Exercise all powers necessary, convenient, or appropriate
to carry out and effectuate its public and corporate purposes
and to conduct its business.
(b) This subsection does not apply to investments of the board.
A contract under subsection (a)(2) may be for a term of not more
than five (5) years, with an ability to renew thereafter.
(c) An agreement under subsection (a)(4) may be for a duration
of three (3) years.
Sec. 3. The board's powers as specified in this article or the
retirement law applicable to a public pension or retirement fund
of the system:
(1) shall be interpreted broadly to accomplish the purposes of
this article or the applicable retirement law; and
(2) may not be construed as a limitation of powers.
Chapter 5. Investments
Sec. 1. The board has the powers, duties, restrictions,
limitations, and penalties in connection with the board's investment
and management of the assets of the public pension and retirement
funds of the system under the following provisions:
(1) IC 5-10.2-2-2.5.
(2) IC 5-10.2-2-13.
(3) IC 5-10.2-2-18.
(4) IC 5-10.3-3-7.1.
(5) IC 5-10.3-5-3.
(6) IC 5-10.3-5-3.1.
(7) IC 5-10.3-5-4.
(8) IC 5-10.3-5-5.
(9) IC 5-10.3-5-6.
(10) IC 5-10.4-3-7.
(11) IC 5-10.4-3-9.
(12) IC 5-10.4-3-10.
(13) IC 5-10.4-3-11.
(14) IC 5-10.4-3-12.
(15) IC 5-10.4-3-13.
(16) IC 5-10.4-3-14.
(17) IC 5-10.4-3-15.
(18) IC 5-10.4-3-16.
Sec. 2. The board's transactions under this chapter are subject
to IC 2-3.5-3-3, IC 5-10-5.5-2.5, IC 5-10.2-2-1.5, IC 33-38-6-13,
IC 33-39-7-22, and IC 36-8-8-2.5.
Chapter 6. Director; Reports and Administration
Sec. 1. (a) The director is the executive officer of the system and
is responsible for the administration of the system.
(b) The director is appointed by and serves at the pleasure of the
board.
Sec. 2. The director shall do the following:
(1) Maintain a record of the board's proceedings.
(2) Keep the books and records of the system.
(3) Deposit payments made to the system with the custodian
for the system's accounts.
(4) Sign vouchers for the payment of money from the system
as authorized by the board.
(5) Execute a corporate surety bond in an amount specified by
the board. The premium for the bond is an administrative
expense of the system.
(6) Perform other duties as assigned by the board.
Sec. 3. (a) The board shall maintain individual records for each
member of a public pension or retirement fund of the system
administered by the board.
(b) A member's record must include at least the following
information:
(1) The member's name.
(2) Date of birth.
(3) Age at beginning service.
(4) Service record.
(5) Address.
(6) Contributions.
(7) Amounts withdrawn.
(8) Benefits paid.
(9) Social Security number.
(10) Any other information necessary for the fund to
administer the member's account.
Sec. 4. (a) Records of:
(1) individual members of; and
(2) membership information concerning;
a public pension or retirement fund administered by the board are
confidential, except for the name and years of service of a member.
(b) This section does not prohibit the board from providing fund
records to an association or organization described in
IC 2-3.5-4-12, IC 2-3.5-5-10, IC 5-10.3-8-10, IC 5-10.4-5-14, or
IC 36-8-8-17.2.
Sec. 5. (a) Each public pension and retirement fund of the
system shall pay the expenses of administration attributable to that
public pension or retirement fund.
(b) The board shall:
(1) prorate the expenses of administration of the system that
cannot be attributed to a particular public pension or
retirement fund and the bond of the director among; and
(2) pay the prorated expenses from;
the public pension and retirement funds of the system.
Chapter 7. Short Title and Saving Provisions
Sec. 1. This article shall be known as and may be cited as the
Indiana public pension modernization act.
Sec. 2. (a) All powers, duties, liabilities, property, equipment,
records, rights, and contracts of the:
(1) board of trustees of the public employees' retirement fund;
and
(2) board of trustees of the teachers' retirement fund;
are transferred to or assumed by the board on July 1, 2011.
(b) The board shall provide indemnification of:
(1) the board of trustees of the public employees' retirement
fund; and
(2) the board of trustees of the teachers' retirement fund;
as necessary or appropriate in regard to any liabilities of the public
employees' retirement fund or the teachers' retirement fund
assumed by the board.
Sec. 3. Any amounts transferred under this subsection to the
system that represent balances in any fund or account of the public
employees' retirement fund or the teachers' retirement fund for the
administration of the public pension and retirement funds
administered by the public employees' retirement fund or the
teachers' retirement fund before July 1, 2011, including any related
services, shall be:
(1) deposited in a fund or account designed by the board; and
(2) used by the system for the administration of the public
pension and retirement funds of the system and related
services.
Sec. 4. The employees of the:
(1) public employees' retirement fund; and
(2) teachers' retirement fund;
become employees of the system on July 1, 2011, without change in
compensation, seniority, or benefits. An employee of the public
employees' retirement fund who is a member of the public
employees' retirement fund before July 1, 2011, and becomes an
employee of the system after June 30, 2011, remains a member of
the public employees' retirement fund after June 30, 2011. An
employee of the teachers' retirement fund who is a member of the
teachers' retirement fund before July 1, 2011, and becomes an
employee of the system after June 30, 2011, remains a member of
the teachers' retirement fund after June 30, 2011. An employee
who becomes an employee of the system after June 30, 2011, is a
member of the public employees' retirement fund, unless the
director expressly determines otherwise.
Sec. 5. Rules and regulations of:
(1) the public employees' retirement fund; and
(2) the teachers' retirement fund;
in effect before July 1, 2011, are considered, after June 30, 2011,
rules and regulations of the system.
Sec. 6. (a) Any reference or cross-reference to:
(1) the board of trustees of the public employees' retirement
fund; or
(2) the board of trustees of the teachers' retirement fund;
in the Indiana Code shall be treated after June 30, 2011, as a
reference or cross-reference to the board.
(b) Any reference or cross-reference to:
(1) the director of the public employees' retirement fund; or
(2) the director of the teachers' retirement fund;
in the Indiana Code shall be treated after June 30, 2011, as a
reference or cross-reference to the director.
Sec. 7. If any provision in this article conflicts with a provision
in IC 5-10.2, IC 5-10.3, or IC 5-10.4, the provisions shall be read
together to the extent possible with any conflict resolved in favor
of the provision in this article.
(b) The board of trustees of the
(c) Any reference or cross-reference to the 1977 fund advisory committee in the Indiana Code shall be treated after June 30, 2011, as a reference or cross-reference to the system board.
(1) the local board has determined under this chapter that a covered impairment exists and the safety board has determined that there is no suitable and available work within the department, considering reasonable accommodation to the extent required by the Americans with Disabilities Act; or
(2) the fund member has filed an appeal under section 12.7(o) of this chapter;
the local board shall submit the local board's determinations and the safety board's determinations to the
(b) Whenever a fund member is determined to have an impairment
under section 12.7(i) of this chapter, the PERF system board's director
shall initiate a review of the default award not later than sixty (60) days
after the director learns of the default award.
(c) After the PERF system board's director receives the
determinations under subsection (a) or initiates a review under
subsection (b), the fund member must submit to an examination by a
medical authority selected by the PERF system board. The authority
shall determine if there is a covered impairment. With respect to a fund
member who is covered by sections 12.5 and 13.5 of this chapter, the
authority shall determine the degree of impairment. The PERF system
board shall adopt rules under IC 4-22-2 to establish impairment
standards, such as the impairment standards contained in the United
States Department of Veterans Affairs Schedule for Rating Disabilities.
The report of the examination shall be submitted to the PERF system
board's director. If a fund member refuses to submit to an examination,
the authority may find that no impairment exists.
(d) The PERF system board's director shall review the medical
authority's report and the local board's determinations and issue an
initial determination within sixty (60) days after receipt of the local
board's determinations. The PERF system board's director shall notify
the local board, the safety board, and the fund member of the initial
determination. The following provisions apply if the PERF system
board's director does not issue an initial determination within sixty (60)
days and if the delay is not attributable to the fund member or the
safety board:
(1) In the case of a review initiated under subsection (a)(1):
(A) the determinations of the local board and the chief of the
police or fire department are considered to be the initial
determination; and
(B) for purposes of section 13.5(d) of this chapter, the fund
member is considered to be totally impaired.
(2) In the case of an appeal submitted under subsection (a)(2), the
statements made by the fund member under section 12.7(o) of this
chapter are considered to be the initial determination.
(3) In the case of a review initiated under subsection (b), the
initial determination is the impairment determined under section
12.7(i) of this chapter.
(e) The fund member, the safety board, or the local board may
object in writing to the director's initial determination within fifteen
(15) days after the determination is issued. If no written objection is
filed, the initial determination becomes the final order of the PERF
system board. If a timely written objection is filed, the PERF system
board shall issue the final order after a hearing. The final order shall be
issued not later than one hundred eighty (180) days after the date of
receipt of the local board's determination or the date the PERF system
board's director initiates a review under subsection (b). The following
provisions apply if a final order is not issued within one hundred eighty
(180) days and if the delay is not attributable to the fund member or the
chief of the police or fire department:
(1) In the case of a review initiated under subsection (a)(1):
(A) the determinations of the local board and the chief of the
police or fire department are considered to be the final order;
and
(B) for purposes of section 13.5(d) of this chapter, the fund
member is considered to be totally impaired.
(2) In the case of an appeal submitted under subsection (a)(2), the
statements made by the fund member under section 12.7(o) of this
chapter are considered to be the final order.
(3) In the case of a review initiated under subsection (b), the
impairment determined under section 12.7(i) of this chapter is
considered to be the final order.
(f) If the PERF system board approves the director's initial
determination, then the PERF system board shall issue a final order
adopting the initial determination. The local board and the chief of the
police or fire department shall comply with the initial determination.
If the PERF system board does not approve the initial determination,
the PERF system board may receive additional evidence on the matter
before issuing a final order.
(g) Appeals of the PERF system board's final order may be made
under IC 4-21.5.
(h) The transcripts, records, reports, and other materials compiled
under this section must be retained in accordance with the procedures
specified in section 12.7(p) of this chapter.
(b) The
(c) To the extent required by the Americans with Disabilities Act, the
(1) A general medical history.
(2) The tests identified in rules that shall be adopted by the
(b) The
(1) reflect the essential functions of the job;
(2) be consistent with business necessity;
(c) The
(1) reflect the essential functions of the job;
(2) be consistent with business necessity;
The purpose of the baseline statewide mental examination is to determine if the police officer or firefighter is mentally suitable to be a member of the department. The local board may designate a community mental health center or a managed care provider (as defined in IC 12-7-2-127(b)), a hospital, a licensed physician, or a licensed psychologist to administer the examination. However, the results of a baseline statewide mental examination shall be interpreted by a licensed physician or a licensed psychologist.
(d) The employer shall pay for no less than one-half (1/2) the cost
of the examinations.
(e) Each local board shall name the physicians who will conduct the
examinations under this section.
(f) If a local board determines that a candidate passes the local
physical and mental standards, if any, established under IC 36-8-3.2-6,
the baseline statewide physical examination described in subsection
(a), and the baseline statewide mental examination described in
subsection (c), the local board shall send the following to PERF:
Indiana public retirement system:
(1) Copies and certification of the results of the baseline statewide
physical examination described in subsection (a).
(2) Certification of the results of the physical agility examination
required under IC 36-8-3.2-3 or IC 36-8-3.2-3.5.
(3) Certification of the results of the baseline statewide mental
examination described in subsection (c).
(g) The PERF system board or the PERF system board's designee
shall then determine whether the candidate passes the baseline
statewide physical standards adopted under subsection (b). If the
candidate passes the baseline statewide standards, the PERF system
board or the PERF system board's designee shall also determine
whether the candidate has a Class 3 excludable condition under section
13.6 of this chapter. The PERF system board or the PERF system
board's designee shall retain the results of the examinations and all
documents related to the examination until the police officer or
firefighter retires or separates from the department.
(h) To the extent required by the federal Americans with Disabilities
Act, the PERF system board shall do the following:
(1) Treat the medical transcripts, reports, records, and other
material compiled under this section as confidential medical
records.
(2) Keep the transcripts, reports, records, and material described
in subdivision (1) in separate medical files for each member.
(i) A local board may, at the request of an appointing authority or on
the local board's own motion, issue subpoenas, discovery orders, and
protective orders in accordance with the Indiana Rules of Trial
Procedure to facilitate the receipt of accurate and original documents
necessary for the proper administration of this chapter. A subpoena or
order issued under this subsection:
(1) must be served in accordance with the Indiana Rules of Trial
Procedure; and
(2) may be enforced in the circuit or superior court with
jurisdiction for the county in which the subpoena or order is
served.
; (11)SB0549.2.31. --> SECTION 31. THE FOLLOWING ARE REPEALED [EFFECTIVE JULY 1, 2011]: IC 2-3.5-2-9; IC 2-3.5-2-13; IC 5-10.2-2-16; IC 5-10.2-2-17; IC 5-10.2-2-19; IC 5-10.3-3-1; IC 5-10.3-3-2; IC 5-10.3-3-3; IC 5-10.3-3-4; IC 5-10.3-3-5; IC 5-10.3-3-6; IC 5-10.3-3-7; IC 5-10.3-3-8; IC 5-10.3-3-9; IC 5-10.3-6-5; IC 5-10.4-3-1; IC 5-10.4-3-2; IC 5-10.4-3-3; IC 5-10.4-3-4; IC 5-10.4-3-5; IC 5-10.4-3-6; IC 5-10.4-3-8.
(b) This SECTION expires June 30, 2013.