August 19, 2009, Introduced by Rep. LeBlanc and referred to the Committee on Labor.
A bill to amend 1986 PA 182, entitled
"State police retirement act of 1986,"
by amending section 3 (MCL 38.1603), as amended by 2008 PA 366.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. (1) "Banked leave time program" means the part B
annual leave hours within the state's annual and sick leave program
approved by a ruling of the internal revenue service on September
5, 2003, in which a pay reduction or other concessions are applied
to a member in exchange for additional part B annual leave hours.
(2) "Credited service" means the sum of the prior service and
membership service credited to a member's account.
(3) "Deferred member" means a member who separates from
service with entitlement to a deferred retirement allowance as
provided in section 30, but who is not a retirant.
(4) "Department" means the department of management and
budget.
(5) "Direct rollover" means a payment by the retirement system
to the eligible retirement plan specified by the distributee.
(6) "Distributee" includes a member or deferred member.
Distributee also includes the member's or deferred member's
surviving spouse or the member's or deferred member's spouse or
former spouse under an eligible domestic relations order, with
regard to the interest of the spouse or former spouse.
(7) "DROP participant" means an officer who participates in
the deferred retirement option plan established in section 24a.
(8) Beginning January 1, 2002, except as otherwise provided in
this subsection, "eligible retirement plan" means 1 or more of the
following:
(a) An individual retirement account described in section
408(a) of the internal revenue code, 26 USC 408.
(b) An individual retirement annuity described in section
408(b) of the internal revenue code, 26 USC 408.
(c) An annuity plan described in section 403(a) of the
internal revenue code, 26 USC 403.
(d) A qualified trust described in section 401(a) of the
internal revenue code, 26 USC 401.
(e) An annuity contract described in section 403(b) of the
internal revenue code, 26 USC 403.
(f) An eligible plan under section 457(b) of the internal
revenue code, 26 USC 457, which is maintained by a state, political
subdivision of a state, or an agency or instrumentality of a state
or political subdivision of a state and which agrees to separately
account for amounts transferred into the eligible plan under
section 457(b) of the internal revenue code, 26 USC 457, from this
retirement system, that accepts the distributee's eligible rollover
distribution.
(g) Beginning January 1, 2008, a Roth individual retirement
account as described in section 408A of the internal revenue code,
26 USC 408A, subject to the rules that apply to rollovers from a
traditional individual retirement account to a Roth individual
retirement account.
(9) Beginning January 1, 2007, "eligible rollover
distribution" means a distribution of all or any portion of the
balance to the credit of the distributee. Eligible rollover
distribution does not include any of the following:
(a) A distribution made for the life or life expectancy of the
distributee or the joint lives or joint life expectancies of the
distributee and the distributee's designated beneficiary.
(b) A distribution for a specified period of 10 years or more.
(c) A distribution to the extent that the distribution is
required under section 401(a)(9) of the internal revenue code, 26
USC 401.
(d) The portion of any distribution that is not includable in
federal gross income, except to the extent such portion of the
distribution is paid to either of the following:
(i) An individual retirement account or annuity described in
section 408(a) or 408(b) of the internal revenue code, 26 USC 408.
(ii) A qualified plan described in section 401(a) of the
internal revenue code, 26 USC 401, or an annuity contract described
in section 403(b) of the internal revenue code, 26 USC 403, and the
plan providers agree to separately account for the amounts paid,
including any portion of the distribution that is includable in
federal gross income, and the portion of the distribution which is
not so includable.
(10) "Final average compensation" means the average annual
salary for the last 2 years of service with the department of state
police for which the member was compensated as defined in
subsection (13). In the case of a nonclassified member of the
department holding the rank of colonel, final average compensation
means the same average annual salary as that computed for the
highest salaried classified member of the department, or at the
average annual salary for the last 2 years of service with the
department of state police for which the member was compensated,
whichever is greater. Average annual salary includes only the
following compensation items:
(a) Regular salary paid for the last 2 years of service,
including, but not limited to, that salary that is deferred
pursuant to a state deferred compensation program.
(b) Overtime, shift differential, and shift differential
overtime paid for the last 2 years of service.
(c) Gross pay adjustments paid affecting the last 2 years of
service, including compensatory time and emergency response
compensation.
(d) Up to a maximum of 240 hours of accumulated annual leave,
paid at the time of retirement separation excluding part B annual
leave hours paid at the time of retirement separation.
(e) Deferred hours under Plan B of the fiscal years ending
September 30, 1981, and September 30, 1982, that are paid at the
time of retirement separation.
(f) Longevity pay equal to 2 full years.
(g) Bomb squad pay paid for the last 2 years of service.
(h) Post 29 freeway premium paid for the last 2 years of
service.
(i) On-call pay paid for the last 2 years of service.
(j) Beginning October 1, 2003, the value of any unpaid
furlough hours or the value of any unpaid hours exchanged for part
B annual leave hours, calculated at the member's then-current
hourly rate or rates of pay, for a period during which a member is
participating in the banked leave time program.
(k) Beginning May 1, 2009, the value of any unpaid furlough
days applied to command officers, if any, the value of unpaid
reduction in force hours, or the value of any temporary layoff
hours. As used in this subdivision, "temporary layoff hours" means
hours attributable to the layoff of a member if the layoff does not
exceed 1 month and has a fixed, predetermined, and announced recall
date.
(11) "Furlough hours" means unworked hours incurred in
conjunction with the banked leave time program.
(12) "Internal revenue code" means the United States internal
revenue code of 1986.
(13) "Last 2 years of service" means the 2-year period
immediately preceding the member's last day of service or that
period of 2 consecutive years of service with the department of
state police immediately preceding the date the duty disability
occurred according to the medical examinations conducted pursuant
to section 29 or, if the officer participated in the deferred
retirement option plan, the 2-year period immediately preceding
participation in the deferred retirement option plan.