(1) Any
employer may withdraw from its participation in the statewide retirement plan
established by article 31.5 of this title 31 for the sole purpose of electing
participation in the statewide money purchase plan created pursuant to the
authority granted in section 31-31-502.
(2) (a) The employer may initiate withdrawal from the statewide retirement
plan by filing with the board a resolution adopted by the employer pursuant to
subsection (2)(b) of this section no less than nine months prior to the effective date
of withdrawal unless a shorter waiting period is approved by the board. The
effective date of withdrawal shall be the first day of the month immediately
following the month in which the waiting period expires.
(b) The employer's withdrawal resolution shall be adopted by the governing
body of the employer and shall state the employer's intent to withdraw from
participation in the statewide retirement plan for the purpose of electing
participation in the statewide money purchase plan.
(c) Any withdrawal shall be approved by at least sixty-five percent of all
active members employed by the employer who are participating in the statewide
retirement plan at the time of the election and who vote in the election proposing
the withdrawal.
(d) The board shall promulgate rules relating to standards for disclosure of
all ramifications and procedures for obtaining the member approval provided for in
subsection (2)(c) of this section.
(e) All withdrawals from the statewide retirement plan shall comply with the
requirements set forth in this section, and, except as otherwise provided in this
section, all withdrawals meeting such requirements shall be approved by the board.
Withdrawal requests that do not meet the requirements of this section shall not be
approved by the board.
(3) The rights of benefit recipients and the vested rights of inactive members
shall not be impaired or reduced in any manner as a result of the withdrawal of an
employer as provided in this section.
(4) (a) (I) The board shall determine the amount of reserves required as of the
effective date of withdrawal to maintain current benefits payable by the association
to benefit recipients and to preserve the vested rights of inactive members. The
amount of reserves shall be determined by the board utilizing certified actuarial
reports prepared by the actuary for the statewide retirement plan. Any such
actuarial report shall also certify that the employer's withdrawal shall not have an
adverse financial impact on the actuarial soundness of the new hire benefits
account. If the actuary determines, in accordance with accepted actuarial
principles, that the withdrawal will not have an adverse financial impact on the
actuarial soundness of the new hire benefits account, the board shall transfer such
employer's share of the employer contribution reserve in the new hire benefits
account, as determined by the actuary, and all member contributions for the
employer's active members to a short-term investment account. If the actuary
determines, in accordance with accepted actuarial principles, that the withdrawal
shall have an adverse financial impact on the actuarial soundness of the new hire
benefits account, the employer shall not be permitted to withdraw.
(II) At least sixty days prior to the effective date of the withdrawal, the
actuarial reports shall be updated and appropriate adjustments made to the
amount of reserves transferred by the board to the short-term investment account
on behalf of the employer if an update is required pursuant to rules adopted by the
board. Within thirty days after the receipt of such updated reports, the withdrawal
may be terminated by either:
(A) The employer filing with the board a subsequent resolution revoking the
employer's resolution of intent to withdraw; or
(B) More than thirty-five percent of the employer's active members who are
eligible to vote filing with the board ballots indicating that they no longer wish to
withdraw.
(III) If a resolution or a sufficient number of ballots is timely filed with the
board pursuant to subparagraph (II) of this paragraph (a), the withdrawal shall be
terminated, and the board shall return to the new hire benefits account any
amounts transferred to the short-term investment account pursuant to
subparagraph (I) of this paragraph (a). If no resolution or an insufficient number of
ballots is timely filed, the withdrawal shall proceed in accordance with the
provisions of this section.
(IV) The board shall prescribe the form of the ballot to be submitted by
members indicating that they no longer wish to withdraw and any other rules
necessary for the implementation of this subsection (4).
(b) On the effective date of withdrawal, the actuarial reports prepared
pursuant to the provisions of paragraph (a) of this subsection (4) shall be updated to
finalize the amount of reserves required for the purposes specified in paragraph (a)
of this subsection (4).
(c) Expenses incurred by the board for the actuarial reports prepared as a
result of an application for withdrawal shall be paid by the employer making such
application.
(d) The board shall provide any information contained in such actuarial
reports upon request of the employer making the application for withdrawal.
(5) (a) In the event that the amount of the reserves required pursuant to the
provisions of subsection (4) of this section exceeds the amount of the employer's
share of the employer contribution reserve in the new hire benefits account as
calculated by the actuary, the employer shall make an additional payment no later
than ten working days after the effective date of withdrawal in an amount equal to
the difference between the amount of reserves required and the amount of
reserves on deposit.
(b) In the event that the amount of the reserves on deposit in the new hire
benefits account, as calculated by the actuary, for the employer making application
for withdrawal, exceeds the amount of reserves required pursuant to the provisions
of subsection (4) of this section, such excess amount and the amount required for
the transfer of member contributions as provided in subsection (6) of this section
shall be transferred to the fire and police members' statewide money purchase plan
benefit trust fund on the effective date of withdrawal. Allocation of such amounts
to individual member accounts under the statewide money purchase plan shall be
made as set forth in section 31-31-502.
(c) The payments required by this section are subject to interest if not
submitted when due.
(6) (a) Members who are not vested under the statewide retirement plan and
who are employed by an employer who has withdrawn from the statewide
retirement plan shall have their member contributions credited to the statewide
money purchase pension plan as set forth in section 31-31-502.
(b) (I) Members who are vested under the statewide retirement plan and who
are employed by an employer who has filed a resolution of intent to withdraw from
the statewide retirement plan may elect that, if the withdrawal becomes effective,
their contributions remain with the statewide retirement plan by giving written
notice to the association no later than the date established for completion of the
member election provided in subsection (2)(c) of this section.
(II) Members who have made such an election shall become inactive
statewide retirement plan members entitled to vested benefits upon termination
and attainment of vested retirement age.
(III) Members who have made such an election shall not be entitled to
withdraw any amounts from their separate retirement account until they have
terminated their current employment.
(IV) If members who have made such an election die or become disabled
prior to termination of employment, neither they nor their survivors shall be eligible
for benefits under the statewide retirement plan, but rather they shall be limited to
those benefits provided in sections 31-31-803, 31-31-807, and 31-31-807.5.
(c) Members who do not elect to leave their contributions with the statewide
retirement plan pursuant to subsection (6)(b) of this section shall have their
member contributions credited to the statewide money purchase pension plan as
set forth in section 31-31-502.
(7) The provisions of section 31-31.5-411 (1)(b) that relate to the purchase of
service credit forfeited by the refund of member contributions shall not apply to
members who are employees of an employer that has withdrawn from the
statewide retirement plan. Such service credit forfeited by such withdrawal may be
purchased pursuant to the provisions of section 31-31.5-310.