PSERS RETIREMENT BENEFICIARY S.B. 1017 (S-2): FLOOR ANALYSIS
Senate Bill 1017 (Substitute S-2 as reported by the Committee of the Whole)
Sponsor: Senator Ron Jelinek
Committee: Education
CONTENT
The bill would amend the Public School Employees Retirement Act to permit a retirant whose spouse was deceased and who later remarried, or a retirant who married after being retired, to select his or her current spouse as a retirement allowance beneficiary under certain conditions.
As a rule, if a retirant selects a beneficiary and the beneficiary predeceases the retirant, the retirement benefit reverts to a straight retirement allowance payable during the remainder of the retirant's life. The bill would create an exception to this provision for a retirant whose spouse was deceased and who later remarried, or a retirant who was not married on his or her retirement date and marries after that date.
If an individual selected a beneficiary under the bill, his or her retirement allowance could not be greater than the actuarial equivalent of the retirement allowance that he or she otherwise would be entitled to under a straight retirement benefit with no additional payments to be made upon his or her death.
Upon the retirant's death, an individual who became a retirant allowance beneficiary as allowed by the bill would not be a health insurance dependent, and would not be entitled to health insurance benefits, with the following exception: A surviving spouse who was selected as a beneficiary under the bill could elect to receive insurance coverage if the surviving spouse were responsible for payment for the elected coverage, and it were paid in a manner prescribed by the retirement system.
The bill also would allow individuals performing out-of-system public education service and members of the State Employees' Retirement System (as well as members of the Public School Employees Retirement System, as is currently provided) to purchase up to five years of service credit in the retirement system for time missed because of maternity, paternity, or child rearing. The bill would replace the term "maternity, paternity or child rearing" with "parental leave".
The bill would take effect on January 1, 2009.
MCL 38.1385 & 38.1391 Legislative Analyst: Curtis Walker
FISCAL IMPACT
The bill would have no fiscal impact on State or local government.
Date Completed: 9-6-06 Fiscal Analyst: Joe CarrascoAnalysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent. sb1017/0506