DEPARTMENT
OF
AUDITS
AND
ACCOUNTS
270 Washington Street, S.W., Suite 1-156
Atlanta, Georgia 30334-8400
270 Washington Street, S.W., Suite 1-156
Atlanta, Georgia 30334-8400
Russell W.
Hinton
State Auditor
(404) 656-2174
State Auditor
(404) 656-2174
March
5, 2008
The
Honorable Bill Heath, Chairman
Senate Retirement Committee
State Capitol, Room 109
Atlanta, Georgia 30334
Senate Retirement Committee
State Capitol, Room 109
Atlanta, Georgia 30334
SUBJECT: State
Auditor’s
Certification
Substitute to Senate Bill 328
(LC 21 9867S)
Substitute to Senate Bill 328
(LC 21 9867S)
Dear
Senator Heath:
This
bill would amend provisions relating to membership and the service retirement
allowance under the Employees’ Retirement System by creating the
“Georgia State Employees’ Pension and Savings Plan.”
Specifically, this bill would apply to persons who first or again become members
of the Employees’ Retirement System on or after January 1, 2009. Under
the provisions of this legislation, 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 December 31, 2008 would continue to be calculated based on 2 percent of their
compensation.
This
substitute bill also provides for an additional benefit through optional
participation in a deferred compensation plan offered by the State for public
employees. Members covered by this proposed plan could also receive up to 3%
contribution from the State, provided the employee contributes 5% of his or her
compensation into the plan. Members would be authorized to make contributions
greater than 5%. Members who participate in this plan would be vested at a rate
of 20% per year, and be fully vested after five years of service.
This
substitute bill also includes provisions to allow existing members to elect
participation in this proposed plan. Members who make this election would have
their retirement benefits computed on a prorated basis. Furthermore, this
substitute bill includes provisions relating to disability benefits for persons
covered under the “Georgia State Employees’ Pension and Savings
Fund” and specifies that members covered by this proposed plan would not
be entitled to group term life insurance coverage under the Employees’
Retirement System.
This
is to certify that this substitute bill is a reduction in cost amendment as
defined in the Public Retirement Systems Standards Law. A copy of the actuarial
investigation and State Auditor’s Summary for Senate Bill 328 (LC 21
9867S) is attached.
Respectfully,
/s/
Russell W. Hinton
State Auditor
State Auditor
RWH/cs