Update on HB 1075 - INPRS annuity accounts issues
HB 1075 is an important bill concerning INPRS that we have been tracking and working on since the start of the session.
Earlier today we alerted members to contact their representatives and ask that the bill be sent to a conference committee for further work.
We can report that the bill has now been assigned to a conference committee which is scheduled to meet Thursday.
We are still urging members to ask legislators to improve the formula from the Senate version and to provide better protections to those public employees and public school teachers who are most near to retirement because they won’t have the time to make up the difference contemplated by the change in formula.
The Conference Committee Conferees are: Rep. Woody Burton (Chair), Sen. Greg Walker, Sen. Karen Tallian and Rep. David Niezgodski.
Synopsis: This bill is the bill to prohibit the contracting out of the annuity work by the Indiana Public Retirement System (INPRS) and to set a calculation that INPRS will use to annuitize TRF and PERF members’ ASA funds:
Provides that INPRS may not, before July 1, 2019, enter into an agreement with a third party provider to provide annuities to retiring and retired members of the public employees' retirement fund (PERF) and the teachers' retirement fund (TRF).
Requires INPRS to establish on October 1 and April 1 each year, beginning on October 1, 2014, the interest rate used to determine the annuity amount purchasable by a member of PERF or TRF who elects to receive an annuity using the member's annuity savings account, and provides that the interest rate is equal to the interest rate on 10 year United States Treasury notes on the immediately preceding September 1 or March 1, respectively, plus 1.5%.
Provides that the interest rate established may not be less than 2% or more than 10%.
Removes language terminating an annual pension paid to the surviving spouse of a governor if the surviving spouse remarries. Increases from 3% to 5% the maximum percentage of a state employee's base salary that may be deducted as an automatic contribution to the state's deferred compensation plan.
ISTA members are asked to contact their State Representative and their State Senator to urge a more favorable interest rate calculation.