05 LC 18
4061-EC/AP
House
Bill 275 (AS PASSED HOUSE AND SENATE)
By:
Representatives Cole of the
125th,
Mumford of the
95th,
Golick of the
34th,
Roberts of the
154th,
Smith of the
129th,
and others
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Chapter 18 of Title 45 of the Official Code of Georgia Annotated, relating
to state
employeeś
insurance and benefits plans, so as to transfer administration of certain
deferred compensation plans from the State Personnel Board to the Board of
Trustees of the
Employeeś
Retirement System of Georgia; to provide for transfer of accounts, funds, and
information; to provide for investment advisors and counselors; to provide for
related matters; to provide an effective date; to repeal conflicting laws; and
for other purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Chapter
18 of Title 45 of the Official Code of Georgia Annotated, relating to state
employeeś
insurance and benefits plans, is amended by striking Article 2 and inserting in
its place a new Article 2 to read as follows:
"ARTICLE
2
45-18-30.
As
used in this article, the term 'employee' means any person, whether appointed or
elected, who provides services for the state, including any state authority
authorized to participate in the
Employeeś
Retirement System of Georgia under Chapter 2 of Title 47, or for a county,
municipality, or other political subdivision and who is paid for providing such
services.
45-18-31.
The
state or any county, municipality, or other political subdivision may contract
with any employee to defer, in whole or in part, any portion of such
employeés
compensation under a deferred compensation plan; and the state, county,
municipality, or other political subdivision may provide the deferred
compensation plan itself or it may contract with any company qualified to do
business in this state to provide such benefits.
45-18-32.
The
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia shall
administer any deferred compensation plan provided for the employees of the
state. Employees of the county boards of health receiving financial assistance
from the Department of Human Resources may, with the approval of the
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia and the
approval of such organizations, participate in the state plan. Employees of
county and independent school systems may, with the approval of the
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia and the
approval of such systems, participate in the state plan. Employees of the Lake
Allatoona Preservation Authority, the Georgia Federal-State Shipping Point
Inspection Service, and the Georgia
Firefighterś
Pension Fund may, with the approval of the
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia and the
approval of such organizations, participate in the state plan. The
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of
Georgia
shall investigate and approve a deferred
compensation plan which gives the employees of the state income tax benefits in
connection with plans authorized by the United States Internal Revenue Code, so
that compensation deferred under such plan shall not be included for purposes of
computation of any federal income tax withheld on behalf of any such employee or
payable by such employee before any deferred payment date. All contributions to
the deferred compensation plan shall also be exempt from state withholding tax
as long as such contributions are not includable in gross income for federal
income tax purposes. The governing body of a city, county, or other political
subdivision may appoint an administrator for all deferred compensation plans,
whose duties shall include the administration of the plan and the investigation
and approval of the plan or plans. All such plans shall provide tax deferral
benefits for the respective employees in a manner similar to that of the plan
for state employees.
45-18-33.
Notwithstanding
any other provision of law to the contrary, in order to carry out the provisions
of the deferred compensation plan, the state or any county, municipality, or
other political subdivision is authorized to make payments for the purchase of
insurance, endowments, annuities, mutual funds, or savings from funds derived
from the deferral of compensation. Such payments shall not be construed to be a
prohibited use of the general assets of the state, county, municipality, or
other political subdivision. The
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia or the
administrator of the plan shall have the power to arrange for a custodian for
the holding of such insurance policies, funds, investments, and other assets of
the fund.
45-18-34.
The
deferred compensation programs authorized by this article shall exist and serve
in addition to retirement, pension, or benefit systems established by the state,
county, municipality, or other political subdivision; and no deferral of income
under the deferred compensation program shall effect a reduction of any
retirement, pension, or other benefit provided by law.
45-18-35.
The
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia or the
administrator of the plan shall arrange for all services required to carry out
the deferred compensation plan or plans so that such plan or plans shall operate
without cost to the state, county, city, or other political subdivision except
for employer contributions to a deferred compensation plan and for the
incidental expense of administering the payroll salary deduction or reduction
and the remittance thereof.
45-18-36.
(a)
The salary reduction or deductions referred to in this article shall be
instituted at the request of the participating employees by the payroll
departments applicable to the respective employees.
(b)
Records of participation agreements, payroll deductions, investment options, and
other individual account information shall be maintained as confidential by the
administrator. The records shall not be disclosed except as necessary to
accomplish the purposes of this article or in cases where a subpoena has been
issued for the purpose of discovery or as otherwise authorized in writing by the
employee. This prohibition shall not bar federal, state, or local tax
authorities from such access to the records as may be necessary to establish the
tax status or liability of a participating employee.
45-18-37.
(a)
As used in this Code section, the term:
(1)
'Special compensation' means compensation for terminal leave and such other
compensation as the
State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia deems
appropriate under federal regulations.
(2)
'Special pay plan' means a qualified retirement plan under Section 401(a) of the
federal Internal Revenue Code, 26 U.S.C. Section 401(a), which reduces federal
tax obligations on special compensation.
(3)
'State employee' means any person, whether appointed or elected, who provides
services for the state, including any state authority authorized to participate
in the
Employeeś
Retirement System of Georgia under Chapter 2 of Title 47.
(4)
'Terminal leave' means accrued and unused annual leave which has not been
forfeited at the time of a state
employeés
separation from service, not to exceed 360 hours.
(b)
The State
Personnel Board
of Trustees of
the
Employeeś
Retirement System of Georgia shall
establish and administer a special pay plan for the deferred payment of special
compensation which reduces the federal tax obligation upon such payments. Such
plan shall become effective not later than July 1, 2005. Participation in such
plan shall be mandatory for all retiring and terminating state employees age 55
and older whose compensation for terminal leave equals $1,000.00 or more.
Payment options from the plan shall include, at a minimum, a lump sum payment to
the employee within seven days after payments are made into the plan on his or
her behalf in an amount equal to the entire amount of special compensation with
earnings thereon, less any mandatory income tax withholding. The board
of
trustees may contract with any company
qualified to do business in this state to provide such benefits.
(c)
Nothing in this Code section shall be construed so as to affect benefits under
Chapter 2 of Title 47.
45-18-38.
Effective
July 1, 2005, the Board of Trustees of the
Employeeś
Retirement System of Georgia shall be the successor to the State Personnel Board
for the purpose of administering any defined compensation plan provided to
employees as referenced in Code Sections 45-18-32 and 45-18-33. The State
Personnel Board shall transfer individual accounts, associated funds, and any
other applicable information in a manner prescribed by the Board of Trustees of
the
Employeeś
Retirement System of Georgia no later than September 30, 2005. The Board of
Trustees of the
Employeeś
Retirement System of Georgia is authorized to employ agents and to contract with
such agents for their services as investment advisors and counselors who will
make recommendations for investments and make investments as the board of
trustees so
authorizes."
SECTION
2.
This
Act shall become effective on July 1, 2005.
SECTION
3.
All
laws and parts of laws in conflict with this Act are repealed.