PUBLIC EMPLOYEE RETIREMENT SYSTEM INVESTMENT ACT (EXCERPT)
Act 314 of 1965
38.1140h Applicable law; retention of financial records; "financial records" defined; disclosure of certain information; actuarial valuation; supplemental actuarial analysis; "proposed pension benefit change" defined; availability of summary annual report; posting or availability of report outlining steps to decrease system's unfunded actuarial accrued liablity.
(1) In addition to the provisions of this act, a system is subject to the applicable accounting, auditing, and reporting requirements contained in the following acts and parts of acts:
(a) 1919 PA 71, MCL 21.41 to 21.55.
(b) The uniform budgeting and accounting act, 1968 PA 2, MCL 141.421 to 141.440a.
(c) Section 91 of the executive organization act of 1965, 1965 PA 380, MCL 16.191.
(2) A system shall retain its financial records for a minimum period of 6 years from the date of the creation of the record unless state or federal law requires a longer retention period. As used in this subsection, "financial records" includes, but is not limited to, records pertaining to expenditures for professional training and education, including travel expenditures, by or on behalf of system board members that are paid by the system.
(3) Except as otherwise provided in this subsection, information regarding the calculation of actual or estimated retirement benefits for members of the system is exempt from disclosure by the system or the political subdivision sponsoring the system pursuant to section 13(1)(d) of the freedom of information act, 1976 PA 442, MCL 15.243. Upon a majority vote of the governing body of the political subdivision sponsoring the system, the system shall provide the designated representative of the political subdivision with a reasonable opportunity to inspect, copy, or receive copies of all information regarding the calculation of actual or estimated retirement benefits for members of the system. The system may require that information provided by the system under this subsection be provided only on a promise of confidentiality by the political subdivision sponsoring the system. A system may make reasonable rules to ensure the confidentiality of records exempt from disclosure under applicable state and federal law. The system may charge a fee under this subsection in accordance with section 4 of the freedom of information act, 1976 PA 442, MCL 15.234. All fees and expenses incurred by the political subdivision sponsoring the system that are related to this subsection shall be borne by the political subdivision and shall not be deducted from or offset against the political subdivision's required pension contributions to the system.
(4) Except as otherwise provided in this subsection, a system shall have an annual actuarial valuation with assets valued on a market-related basis. The actuarial present value of total projected benefits must include all pension benefits to be provided by the system to members or beneficiaries under the terms of the system and any additional statutory or contractual agreements to provide pension benefits through the system that are in force at the actuarial valuation date, including, but not limited to, service credits purchased by members, deferred retirement option plans, early retirement programs, and postretirement adjustment programs. A system that has assets of less than $20,000,000.00 is only required to have an actuarial valuation as required under this subsection done every other year.
(5) A system shall provide a supplemental actuarial analysis before adoption of pension benefit changes. System assets must not be used for any actuarial expenses related to the supplemental actuarial analysis under this subsection. The supplemental actuarial analysis must be provided by the system's actuary and must include an analysis of the long-term costs associated with any proposed pension benefit change. The supplemental actuarial analysis must be provided to the board of the particular system and to the decision-making body that will approve the proposed pension benefit change at least 7 days before the proposed pension benefit change is adopted. For purposes of this subsection, "proposed pension benefit change" means a proposal to change the amount of pension benefits received by persons entitled to pension benefits under the system. Proposed pension benefit change does not include a proposed change to a health care plan or health benefits.
(6) The system shall make the summary annual report created under section 13 available to the plan participants and beneficiaries and the citizens of the political subdivision sponsoring the system. If the system has a website, the system shall publish the summary annual report on the website. If the system does not have a website, the political subdivision sponsoring the system shall publish the summary annual report on a website that the political subdivision has created or may create.
(7) For a system other than a state unit, if the system's actuarial accrued liability for retiree health or pension is not at least 60% funded according to the most recent summary annual report created under section 13, the system shall post an informational report on the system's website outlining the steps, if any, the system may be taking to decrease the system's unfunded actuarial accrued liability. If the system does not have a website, the political subdivision sponsoring the system shall make the steps the system may be taking under this subsection available to the plan participants and beneficiaries and the citizens of the political subdivision. The system shall submit to the department of treasury, in a reasonable time frame and in a manner determined by the department of treasury, the steps the system may be taking under this subsection. As used in this subsection, "state unit" means that term as defined in section 13.
History: Add. 1982, Act 55, Imd. Eff. Apr. 6, 1982
Am. 1996, Act 485, Imd. Eff. Dec. 27, 1996
Am. 2002, Act 728, Imd. Eff. Dec. 30, 2002
Am. 2012, Act 347, Eff. Mar. 28, 2013
Am. 2016, Act 530, Eff. Mar. 29, 2017
© 2017 Legislative Council, State of Michigan