Expedited Bill No. _-=9_-1:...::0:...-_ __
Concerning:
Personnel - Retirement
Incentive Program
Revised: April 20. 2010 Draft No. _3_
Introduced:
March 23.2010
Enacted:
April 27. 2010
Executive: _ _ _ _ _ _ _ _ __
Effective:_ _:-:--_ _ _ _ _ __
Sunset Date:--!,N:!.!::o2,!n.::::,.e_ _ _ _ __
Ch. _ _, Laws of Mont. Co. _ _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Council President at the Request of the County Executive
AN EXPEDITED ACT
to:
(1)
provide a retirement incentive program for certain members of the Employees'
Retirement System; and
(2)
generally amend the law regarding the Employees' Retirement System.
By amending
Montgomery County Code
Chapter 33, Personnel and Human Resources
Sections 33-40, 33-42, and 33-44
By adding
Montgomery County Code
Chapter 33, Personnel and Human Resources
Section 33-42A
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Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law unaffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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EXPEDITED BILL
No. 9-10
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Sec.
1.
Sections 33-40, 33-42, and 33-44 are amended as follows:
Sec. 33-40. Employer Contributions
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Guaranteed Retirement Income Plan
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For any member who received
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contribution to the member's
guaranteed retirement income plan account under Section 33­
42A, interest must be credited at an annual rate of7.25%. If the
annual 7.25% interest rate does not comply with applicable law,
the third segment rate described in Internal Revenue Code
Section 430(h)(2)(G) or any successor provision must apply.
Interest must be credited to
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member's guaranteed retirement
income plan account balance on
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monthly basis as of the last
~of~mooth.
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33-42. Amount of pension at normal retirement date or early retirement date.
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(b)
Amount of pension at normal retirement date.
(4)
Guaranteed retirement income plan. A member who retires on
or after the member's normal retirement date." except
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member
who receives
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contribution under Section 33-42A, may receive
that member's vested guaranteed retirement income plan
account balance under Section 33-44.
member who receives
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f!:
contribution under Section 33-42A must not receive
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distribution of the member's guaranteed retirement income plan
account balance until the member attains the Social Security
retirement age.
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EXPEDITED BILL
No.
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33-44. Pension payment options and cost-of-Iiving adjustments.
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(g)
Distributions from the Guaranteed Retirement Income Plan.
[Upon
tennination of County employment, a] A participant who receives
contribution under Section 33-42A must not receive
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distribution
until the participant attains the Social Security retirement age. Any
other participant may receive
tenninates County employment.
A participant may [request] elect a distribution from the guaranteed
retirement income plan of a participant's vested guaranteed retirement
income plan account balance as follows:[.]
(1)
Lump Sum Method of Distribution. Unless a participant elects
an annuity under paragraph (2), a participant must receive the
participant's vested guaranteed retirement income plan account
balance in a single lump sum. The participant may have the
lump sum paid as a direct rollover to an eligible retirement
plan.1 as defined in the Internal Revenue Code.
(2)
Annuity Method of Distribution. A participant may elect to
receive the participant's guaranteed retirement income plan
account balance paid in.;.
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distribution when the participant
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a single life annuity payable to the participant during the
life of that participant.;. or
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joint and survivor annuity payable to the participant
over the participant's lifetime and, at the participant's
death, payable to the designated beneficiary (spouse,
domestic partner, or children only) who survives.
Payments must be made for the designated beneficiary's
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EXPEDITED BILL
No. 9-10
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lifetime in the amount payable to the participant or
another amount elected
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the participant, but not less
than 10 percent of the amount payable to the participant.
[The Board must use the participant's vested guaranteed
retirement income plan account balance to buy an
annuity contract from an insurance company authorized
to do business in the State.]
(3)
No other form of payment options listed in this Section
available to guaranteed retirement income plan participants.
Sec. 2. Section 33-42A is added as follows:
33-42A. 2010 Retirement Incentive Program.
IS
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Definitions.
Affected class
means an occupational class or
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group of occupational
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classes in
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department, including all classes in an occupational series
at and below the budget level class, if:
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the class includes
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position that the department director intends
to eliminate; and
eliminating the position may cause an employee in the class to
be demoted or terminated.
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Affected employee
means an employee assigned to
position in an
affected class who has received
Reduction in Force (RIF).
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notice of intent or notification of
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Enhanced retiree
life
insurance benefit
means no reduction in any
provided basic life illsurance benefit for the first 10 years after the
employee's retirement date.
Enhanced retiree health plan cost sharing benefit
means
a
County
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contribution of 90% of the premium for individual coverage for any
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ExPEDITED BILL
No. 9-10
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health insurance plan provided by the County for the first 5 years after
the employee's retirement date.
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Eligibility.
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A Group
.£h
E or H member who is employed in
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part time or
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full time position may apply to participate in the 2010
Retirement Incentive Program if the member:
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is eligible for:
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(ii)
normal retirement on or before June.L 2010; or
early retirement, and is within
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years of meeting
the criteria for normal retirement on June .L 2010;
and
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is an affected employee.
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A member is not eligible to participate in the 2010 Retirement
Incentive Program if the member:
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receives
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disability retirement under Section 33-43;
receives
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discontinued service retirement under Section
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33-45(d);
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is an elected or appointed official; or
is employed by
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participating agency.
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A member must apply to participate in the 2010 Retirement
Incentive Program, must complete all required forms
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May
14,2010, and must retire on June.L 2010.
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A member who applies for
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disability retirement under Section
33-43 must not receive any benefit under this Section unless the
member's application for disability retirement is denied and all
appeals from that denial are exhausted.
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EXPEDITED BILL
No.
9-10
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f£)
Early retirement reduction.
A member's pension benefit must not be
reduced for early retirement if the member is eligible for early
retirement and within
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years of eligibility for normal retirement.
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Additional Retirement Benefit.
In addition to the pension benefit
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calculated under this Section, .!! participant must elect one of the
following additional retirement benefits. A part time participant must
receive
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pro-rata portion of the applicable retirement benefit, based
on that participant's percent of budgeted full time employment.
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$35,000 pension benefit;
$30,000 pensIon benefit and an enhanced retiree life insurance
benefit; or
$28,000 pension benefit and an enhanced retiree health plan
cost sharing benefit.
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The participant must elect to receive the cash portion of the additional
pension benefit paid under Subsection
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as:
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.!! single lump sum on July
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2010:
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to the member or the member's designated beneficiary if
the member dies before receiving the lump sum payment;
an
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as.!! direct rollover to an eligible retirement plan (as
defined in the Internal Revenue Code); or
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.!! combination of
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and
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equal monthly payments beginning on July
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2010:
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to the member or the member's designated beneficiary if
the member dies before receiving allll payments;
an
as.!! direct rollover to an eligible retirement plan (as
defined in the Internal Revenue Code); or
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.!! combination of
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and
.cI!t
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EXPEDITED BILL
No.
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contribution to an account established for the member under
the guaranteed retirement income plan. A member must receive
the member's guaranteed retirement income plan account
balance when the member attains the Social Security retirement
age; or
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an additional pension benefit paid over the member's lifetime in
the pension option elected by the member under Section 33-44,
beginning on July
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2010.
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Cost qf Living.
Any cost of living adjustment does not apply to this
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benefit. A cost of living adjustment under Section 33-44(c) must not
include the additional pension benefit paid under this Section.
(g)
Approval.
The Chief Administrative Officer must approve
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request
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to participate in the program from
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member employed in the
Executive Branch. The Council Staff Director must approve
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request
to participate from
member employed in the Legislative Branch.
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The Chief Administrative Officer and the Council Staff Director must
not approve more applications from an affected class than the number
of positions that are abolished in the affected class.
The Chief
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Administrative Officer and the Council StaffDirectQr may disapprove
an application
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vacancy created by a member participating in the
program cannot be filled by atnember of an affected class. If more
members apply to participate
in
the program than the number of
positions abolished, the [[participant's]] participants must be approved
in order of County seniority[l Seniority must be]] calculated under
the RlF personnel regulation in the following
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participants who applied for the proposed 2009 Retirement
Incentive Program: and
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EXPEDITED BILL
No.
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all other participants.
Repayment.
A participant must repay the lump sum benefit received
to the Employees' Retirement System Trust Fund before returning to
County service as an employee or under a contract.
Sec.
3. Reports.
By July 1. 2010, the Executive must submit a report to the Council that lists
the number of employees in each affected class within each department or office
who, due to the abolishment of positions in the approved FYII operating budget.
either:
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retired with a discontinued service pension: or
participated in the retirement incentive program.
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The Executive's Recommended Budgets for FYI2, FYI3, and FYI4 must
compare the number of positions in each class of positions eligibleJor the
retirement incentive program approved for funding in FYII with the number of
positions in the same class re90mmended for funding in the recommended budget.
Sec.
4. Effective Date.
The Council declares that this legislation is necessary for the immediate
protection of the public interest. This Act takes effect on the date when it becomes
law.
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EXPEDITED BILL
No. 9-10
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Approved:
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Approved:
Isiah Leggett, County Executive
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This is a correct copy ofCouncil action.
Linda M. Lauer, Clerk of the Council
Date
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