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SENATE PROPOSAL OF AMENDMENT 2007-2008

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H.516

AN ACT RELATING TO THE CREATION OF ONE FUND WITHIN EACH OF THE THREE VERMONT RETIREMENT SYSTEMS AND TO COMPLiance WITH FEDERAL REQUIREMENTS

The Senate proposes to the House to amend the bill as follows:

First:  In Sec. 6, 3 V.S.A. § 465(b)(1), in the second sentence, after the word “In” and before the words “the event”, by adding the words the absence of a written designation of beneficiary or in

Second:  In Sec. 11, 3 V.S.A. § 473(b)(1), in the first sentence, by striking out the word “an” and inserting in lieu thereof the word and

Third:  In Sec. 28, 16 V.S.A. § 1940(b)(1), in the second sentence, after the word “In” and before the words the event, by adding the words the absence of a written designation of beneficiary or in

Fourth:  By striking out Sec. 30 in its entirety and inserting in lieu thereof a new Sec. 30 to read:

Sec. 30.  16 V.S.A. § 1942 is amended to read:

§ 1942.  BOARD OF TRUSTEES; MEDICAL BOARD; ACTUARY; RATE
  OF CONTRIBUTION; SAFEKEEPING OF SECURITIES

* * *

(o)  The Vermont pension investment committee shall designate from time to time a depository for the securities and evidences of indebtedness held in the various funds fund of the system and may contract for the safe‑keeping of securities and evidences of indebtedness within and without the state of Vermont in such banks, trust companies, and safe‑deposit facilities as it shall from time to time determine, and the necessary and incidental expenses of such safe‑keeping and for service rendered, including advisory services in investment matters, shall be paid from the expense fund hereinafter provided.  Any agreement for the safe‑keeping of securities or evidences of indebtedness, except securities loaned pursuant to a securities lending agreement as authorized by subsection (q) of this section, shall provide for the access to such securities and evidences of indebtedness at any time by the custodian or any authorized agent of the state for audit or other purposes.

(p)  The board may enter into insurance arrangements to provide health and medical benefits for retired members and their dependents.  The board may enter into insurance arrangements to provide dental coverage for retired members and their dependents, provided the state or the system has no legal obligation to pay any portion of the dental benefit premiums.

(q)  The Vermont pension investment committee may authorize the loan of its securities pursuant to securities lending agreements that provide for collateral consisting of cash or securities issued or guaranteed by the United States government or its agencies equal to 100 percent or more of the market value of the loaned securities.  Cash collateral may be invested by the lending institution in funds investments approved by the state treasurer.  Approval of funds investments shall be made in accordance with the standard of care established by the prudent investor rule under chapter 147 of Title 9.

(r)  The board shall review annually the amount of state contribution recommended by the actuary of the retirement system as necessary to achieve and preserve the financial integrity of the funds fund established pursuant to section 1944 of this title.  Based on this review, the board shall recommend the amount of state contribution that should be appropriated for the next fiscal year to achieve and preserve the financial integrity of the funds.  On or before November 1 of each year, the board shall submit this recommendation to the governor and the house and senate committees on government operations and appropriations.

Fifth:  In Sec. 33, 16 V.S.A. § 1944(b), by striking out subdivision (7) in its entirety and inserting in lieu thereof a new subdivision (7) to read:

(7)  The contributions of a member, and such interest as may be allowed thereon, paid upon the member’s death or withdrawn by the member as provided in this chapter, shall be paid from the annuity savings fund, and any balance of the accumulated contributions of such a member shall be transferred to the pension accumulation fund.  Upon the retirement of a member, the member’s accumulated contributions shall be transferred from the annuity savings fund to the annuity reserve fund.

Sixth:  In Sec. 36, 24 V.S.A. § 5051(23), by striking out the words “section 473 of Title 3” and inserting in lieu thereof the words section 5064 of Title 24

Seventh:  In Sec. 42, 24 V.S.A. § 5059(a), in the last sentence, after the words “group B and C” by adding the words , group C,

Eighth:  In Sec. 47, 24 V.S.A. § 5064(e), by adding a new subdivision (5) to read as follows:

(5)  The board may, in its discretion, waive part or all of a penalty assessment for good cause shown.

Ninth:  By striking out Sec. 49 in its entirety and inserting in lieu thereof a new Sec. 49 to read:

Sec. 49.  24 V.S.A. § 5070 is amended to read:

§ 5070.  DEFINED CONTRIBUTION RETIREMENT PLAN

(a)  The board may approve a defined contribution retirement plan for one or more groups of members.  The plan shall qualify as a defined contribution plan under the United States Internal Revenue Code, as amended.  Participation in a defined contribution plan offered under this section shall be in lieu of participation in any other plan established under this title.  The board shall ensure that objective educational material be prepared and presented to the employees in order to enable them to make an informed decision, under the assumption that each participant is an unsophisticated investor.

(b)  The proper authority or officer responsible for making up each employer payroll shall certify to the board the amounts deducted on each and every payroll for employees participating in the defined contribution plan, and each of those amounts shall be paid into the defined contribution fund and credited to the individual account of the member from whose compensation the deduction was made.

(1)  Employer reports and corresponding member contributions required by this subsection shall be provided by the due date established by the board.  An employer that provides reports or remits contributions, which are more than 30 days delinquent, may be assessed a delinquent reporting fee of one percent of the amount that should have been reported and remitted for each month, or prorated portion of a month, that the report or contributions are delinquent.

(2)  Employers shall provide accurate reports.  An employer who provides an inaccurate report shall be responsible for correcting any deficiencies and shall reimburse the system for any costs incurred by the system as a result of inaccuracy.

(3)  In the event that an employer willfully files an inaccurate report, in addition to any other penalties provided by law, the employer shall pay the system an administrative penalty of up to 50 percent of the amount that was not accurately reported.

(4)  The system may enforce the provisions of this subsection in Washington superior court.

(5)  The board may, in its discretion, waive part or all of a penalty assessment for good cause shown.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us