DEPARTMENT
OF
AUDITS
AND
ACCOUNTS
270 Washington Street, S.W., Suite 1-156
Atlanta, Georgia 30334-8400
270 Washington Street, S.W., Suite 1-156
Atlanta, Georgia 30334-8400
Russell W.
Hinton
State Auditor
(404) 656-2174
State Auditor
(404) 656-2174
March
25, 2009
The
Honorable Bill Heath
State Senator
State Capitol, Room 109
Atlanta, Georgia 30334
State Senator
State Capitol, Room 109
Atlanta, Georgia 30334
SUBJECT: State
Auditor’s
Certification
Substitute to House Bill 476
(LC 21 0459S)
Dear Senator Heath:
Substitute to House Bill 476
(LC 21 0459S)
Dear Senator Heath:
This
substitute bill would amend provisions relating to the Employees’
Retirement System. Specifically, this substitute bill would place requirements
on employers who grant salary increases in excess of 5 percent during the 12
months prior to an employee’s retirement. Under the provisions of this
bill, the employer would be responsible for paying the full actuarial cost of
retirement benefits that are due to an employee as a result of the employee
receiving a salary increase in excess of 5 percent during the 12 months prior to
retirement. This substitute bill would apply for all persons who became members
prior to July 1, 2009. Additionally, this substitute bill would amend
provisions relating to the calculation of a service retirement allowance for
persons who become employed on or after July 1, 2009 and are covered under the
Georgia State Employees’ Pension and Savings Plan. If this substitute
bill is enacted, the computation of a retirement benefit shall not include a
compensation increase in the last 12 months of employment that exceeds five
percent. All other provisions currently applicable to the calculation of a
retirement allowance would remain in effect.
Retirement
Certification for Senator
Heath
Substitute to House Bill 476 (LC 21 0459S)
March 25, 2009
Page 2
Substitute to House Bill 476 (LC 21 0459S)
March 25, 2009
Page 2
This
substitute bill would also amend provisions relating to certain law enforcement
personnel that are covered under the Employees’ Retirement System.
Specifically, this bill would authorize the Board of Trustees to increase the
normal and accrued liability employer contribution rates for the Georgia Bureau
of Investigation, Department of Corrections, and the State Board of Pardons and
Paroles to an amount that is actuarially sufficient to fund the employer’s
cost of the benefits provided for the law enforcement personnel of these
departments. Current law already authorizes the Board of Trustees to adjust the
rate for the Department of Public Safety, Department of Natural Resources, and
the Department of Revenue. Additionally, this bill includes clarifying language
relating to death benefits paid to members who are hired on or after July 1,
2007.
Finally,
this substitute bill would amend provisions relating to reemployment under the
Peace Officers’ Annuity and Benefit Fund. Currently, members who qualify
for a normal service retirement may continue to receive retirement benefits if
they return to work as a peace officer. If this legislation is enacted, persons
who first or again become a member of the Fund on or after July 1, 2009 would no
longer be eligible to retain their benefits if they become reemployed. This
legislation would require the Fund to discontinue benefits for the duration of
the reemployment.
This
is to certify that this substitute bill is a nonfiscal retirement bill as
defined in the Public Retirement Systems Standards Law.
Respectfully,
/s/ Russell W.
Hinton
State Auditor
State Auditor
RWH/cs