DEPARTMENT
OF
AUDITS
AND
ACCOUNTS
270
Washington Street, S.W., Suite 1-156
Atlanta,
Georgia 30334-8400
Russell W.
Hinton
STATE AUDITOR
(404) 656-2174
April
2, 2007
The Honorable Bill
Heath
State Senator
State Capitol, Room 109
Atlanta, Georgia 30334
State Senator
State Capitol, Room 109
Atlanta, Georgia 30334
SUBJECT: State
Auditor’s
Certification
Senate Bill (LC 21 9447)
Senate Bill (LC 21 9447)
Dear Senator
Heath:
This
bill would amend provisions relating to membership and the service retirement
allowance under the Employees’ Retirement System. Specifically, this bill
would provide for employer contributions to be made into a deferred compensation
plan for certain members. Such members would then receive a retirement
allowance through the Employees’ Retirement System at a reduced rate.
The provisions of this bill would apply to persons who first become members on
or after July 1, 2008, and to persons who again become members on or after such
date if the member did not have a vested right to be reinstated in the
Employees’ Retirement System.
Under
the provisions of this bill, all persons affected by this legislation would be
required to have an account in the deferred compensation plan offered by the
State for public employees. Each employee would be given the option of
selecting either the Section 401(k) plan or the Section 457(j) plan. This bill
would require the employer for each participant to contribute an amount not
greater than 9 percent of the employee’s salary into the employee’s
account. Each employee would have a vested right to the employer contributions
immediately upon deposit. This bill specifies that the Board of Trustees for
the Employees’ Retirement System will administer the provisions of this
legislation, and authorizes the Board to establish all necessary rules and
regulations.
This
bill would also amend provisions relating to the service retirement allowance
provided to persons affected by this bill. If this legislation is enacted, such
members would receive retirement benefits equal to 1 percent of their highest
average monthly compensation during a period of 24 consecutive calendar months
multiplied by the member’s years of creditable service. Benefits paid to
persons who are already members on June 30, 2008 would continue to be calculated
based on 2 percent of their compensation.
This
is to certify that this is a fiscal retirement bill as defined in the Public
Retirement Systems Standards Law.
Respectfully,
/s/ Russell W.
Hinton
State Auditor
State Auditor