Expedited Bill No.
20-15
Concerning:
Deferred
Retirement
Option Plan - Amendments -
Retirement Savings Plan - Annuity -
Guaranteed Retirement Income Plan
- Election
Revised: May 7. 2015 Draft No. =-6_ _
Introduced:
April 21. 2015
Enacted:
May 21, 2015
Executive: - - - - - - - - -
Effective: - - - - - - - - - -
Sunset Date:
....:N~o""'"n~e
_ _ _ _ __
Ch. _ _ , Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
Lead Sponsor: Council President at the Request of the County Executive
AN EXPEDITED ACT
to:
(1)
(2)
(3)
(4)
make the guaranteed retirement income plan the default retirement option for
certain employees;
establish a deferred retirement option plan for sworn deputy sheriffs and uniformed
correctional officers;
provide an annuity option for employees who participate in the retirement savings
plan; and
generally amend the County employee retirement laws.
By amending
Montgomery County Code
Chapter 33, Personnel and Human Resources
Sections 33-37, 33-38A, 33-44, 33-115 and 33-120
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
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. 20-15
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Sec. 1. Sections 33-37, 33-38A, 33-44, 33-115, and 33-120 are amended
as follows:
33-37. Membership requirements and membership groups.
(a)
Full-time employees.
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(1)
A full-time employee of the County or participating agency must
become a member of a County retire.ment plan as a condition of
employment, when the employee meets the applicable eligibility
requirements, if the employee waives all rights of membership
under any other retirement system supported in whole or in part
by the State, a political subdivision of the State, or the County.
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(2)
A part-time employee who becomes a full-time employee and is
not an active member of any County retirement plan must
become an active member of:
(A)
the integrated retirement plan, if the employee is eligible
for membership in the integrated plan;
(B)
the Retirement Savings Plan, ifthe employee satisfies the
requirements for membership in Group I or II, even if the
employee did not begin or return to County service on or
after October 1, 1994 and participates as described
in
Section 33-115; or
(C)
the guaranteed retirement income plan if the employee is
eligible for membership and [elects to] participate§. as
described in subsection (k).
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(3)
A temporary employee who becomes a full-time employee must
become an active member of:
(A)
the integrated plan, if the employee 1s eligible for
membership in the integrated plan;
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EXPEDITED BILL NO. 20-15
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(B)
the Retirement Savings Plan,
ff
the employee satisfies the
requirements for membership in Group I or II, even if the
employee did not begin or return to County service on or
after October 1, 1994 and participates as described in 33-
115; or
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(C)
the guaranteed retirement income plan if the employee is
eligible for membership and [elects to participate]
participates as described in subsection (k).
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(b)
Part-time employees.
(
1)
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A part-time employee of the County or participating agency may
become a member of a County retirement plan if the employee
waives all rights of membership under any other retirement
system supported in whole or in part by the State, a political
subdivision of the State, or the County. Membership is effective
on the date the employee's application for membership is
approved.
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(2)
A part-time employee who is not an active member of a
retirement plan may become a member of either:
(A)
the integrated plan, if the employee 1s eligible for
membership in the integrated plan;
(B)
the Retirement Savings Plan if the employee satisfies the
requirements for membership in Group I or II, even if the
employee did not begin or return to County service on or
after October 1, 1994 and elects to participate as described
in Section 33-115; or
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EXPEDITED BILL NO. 20-15
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(C)
the guaranteed retirement income plan if the employee is
eligible for membership and elects to participate as
described in subsection (k).
*
(k)
*
*
*
*
[Election to join] Eligibility.for the guaranteed retirement income plan.
*
(3)
An
eligible full-time employee hired on or after July 1, 2009 and
before July
L.
2015, and a part time or temporary employee who
becomes full time on or after July 1, 2009 and before July
L.
2015, who does not participate in the retirement savings plan,
may elect to participate in the guaranteed retirement income plan.
An
eligible employee must make an irrevocable election during
the first 150 days of full time employment.
If an eligible
employee elects to participate, participation must begin on the
first pay period after an employee has completed 180 days of full
time employment.
An
employee who does not participate in the
guaranteed retirement income plan must participate in the
retirement savings plan beginning on'the first pay period after the
employee completes 180 days of full time employment.
*
(1)
*
*
A member of the Office, Professional and Technical (OPT) or
the Service, Labor and Trades (SL T) collective bargaining unit
of the County government must participate in the guaranteed
retirement income plan unless the employee makes
~
one-time
irrevocable election to participate in the retirement savings plan
during the first 150 days of full time employment, if the
employee:
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EXPEDITED BILL NO. 20-15
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.{Al
is hired
or
as~
full-time employee on or after July
.L
2015;
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ill}
is
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part time employee who does not participate in the
retirement savings plan and
becomes~
full-time employee
on or after July
.L
2015.
Participation must begin on the first
oo
period after an employee
has completed 180 days of full time employment.
On or after July
.L
2015, an eligible full-time employee
or~
part-
time or temporary employee who becomes
~
full-time employee
in
~
.(fil
position that is not within
~
bargaining unit or an eligible
employee of a participating agency must participate in the
retirement savings plan unless the employee makes
~
one-time
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irrevocable election to participate in the guaranteed retirement
income plan during the first 150 days of full time employment.
If the employee elects to participate, participation must begin on
the first
oo
period after an employee has completed 180 days of
full-time employment. A part-time employee who participates
in either the retirement savings plan or the guaranteed retirement
income plan when the employee
becomes~
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full-time employee
must continue to participate in the same retirement plan.
[(7)].{2} An individual who changes employment from the County
government to a participating agency or from a participating
agency to the County government
m~st
continue to participate in
his or her retirement plan and is not eligible to make an election.
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33-38A. Deferred Retirement Option Plans.
*
*
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*
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EXPEDITED BILL NO. 20-15
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w
DROP Plan (or Sworn Deputy Sheriffs and Uniformed Correctional
Officers.
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Uniformed correctional o(ficer
means Correctional Officer
1.
Correctional Officer
!1
Correctional Officer III, Correctional
Dietary Officer
L
Correctional Dietary Officer
!1
Correctional
Supervisor-Sergeant,
Correctional
Dietary
Supervisor,
Correctional Shift Commander-Lieutenant, Correctional Unit
Commander-Captain, Deputy Warden, and Warden. [[and]] The
Director of the Department of Corrections must not begin
participation in the DROP after appointment as Director.
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Sworn Deputy Sheriff
means Deputy Sheriff
1.
Deputy Sheriff
!1
Deputy Sheriff Ill, Deputy Sheriff Sergeant, Deputy Sheriff
Lieutenant, Deputy Sheriff Captain, Assistant Sheriff, and the
Chief Deputy Sheriff (Colonel).
ill
Eligibility.
A sworn deputy sheriff or uniformed correctional
officer who is at least age 55 years old and has at least
12.
years
of credited service or is at least 46 years old and has at least 25
years of credited service may participate in the DROP.
A
uniformed correctional officer or sworn deputy sheriff must
participate in the optional retirement plan or the integrated
retirement plan as
the DROP.
.(i}
~
Group E member in order to participate in
Application requirements.
An
eligible employee must apply at
least 60 days before the employee becomes
employee may withdraw
~
~
participant. An
pending application within
2
weeks
after submitting the application.
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EXPEDITED BILL NO. 20-15
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Employee participation and termination.
The employee's
participation in the DROP must begin on the first day
of~
month
that begins at least 60 days, but not more than 90 days, after the
employee applied and must end
J
years after the employee begins
to participate or at an earlier date chosen
12y
the employee. When
the employee's participation in the DROP ends, the employee
must stop working for the County and receive
~
pension benefit.
.(fil
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Employment status.
An
employee who participates in the DROP
must continue to be
~member
of the retirement system, earn sick
and annual leave, and remain eligible to participate in health and
life
insurance programs.
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Retirement date. retirement contributions. and credited service.
The retirement date of an employee who participates in the
DROP is the date when the employee begins to participate in the
DROP,
and the
employee
must not make retirement
An
employee who wishes to
contributions after that date.
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purchase prior service must do so before the employee's
participation in the DROP begins. Sick leave in excess of 80
hours must be credited towards retirement at the beginning of the
employee's participation.
([}
Pension benefits.
(A)
Before an employee's participation begins, the employee
must select a:
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(ii)
pension payment option under Section 33-44 for the
regular retirement pension payments; and
pension payment distribution option for the
distribution of the employee's DROP account.
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EXPEDITED BILL NO. 20-15
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I
(ID
A pension benefit must not be paid to the employee while
the employee participates in the DROP, but must be
deposited in
!!
DROP account established for the
participant
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the County. The participant must receive
the account balance and the County must close the account
within 60 days after the employee stops participating in
the DROP. Subject to any requirements of the Internal
Revenue Code and other applicable law, the employee
may roll over the account balance into an eligible
retirement plan.
.{Q
An employee must direct the Board of Investment
Trustees to allocate pension benefits contributed to the
employee's DROP account in one or more of the
investment funds selected
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the Board. An employee's
direction of investment must remain in effect until the
employee changes the direction. An employee must select
investment options in order to ·participate in the DROP.
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(D)
After the employee's participation in DROP ends, the
employee's pension benefit will be based on:
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the employee's credited service immediately prior
to the beginning of the employee's participation in
the DROP, adjusted to include credit for unused
sick leave under Section 33-41;
(ii)
the employee's average final earnings, excluding
earnings during the period of participation in the
DROP; and
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(iii)
increases in the consumer price index during the
period of the employee's participation that would
have resulted in an increase in the employee's
pension benefit if the employee had not been
participating in the DROP.
.(2}
Disability retirement.
An
employee may apply for disability
retirement prior to the termination of the employee's
participation in the DROP.
.(A}
A DROP participant who is eligible for
~
serv1ce-
connected disability retirement must choose either:
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(ii)
the retirement benefit under the DROP and the
DROP account balance; or
the service-connected disability retirement benefit
that the employee would have received if the
employee had continued as an active employee and
had not elected to participate in the DROP, and no
DROP account balance.
.(ID
A DROP participant who is eligible for
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non-service-
connected disability retirement benefit must receive the
non-service-connected disability retirement benefit under
Section 33-43(h), with the benefit calculated as of the
member's DROP [[exit]] entry date, plus the DROP
account balance.
.(Q
If
~
DROP participant ends participation in the DROP
before
~
final decision is made on the disability retirement
application, the DROP account must not be distributed
until
~
final decision is made.
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EXPEDITED BILL NO. 20-15
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!
Ll.fil
Death benefit.
If
an employee dies during the employee's
participation in the DROP, the employee's beneficiary will
receive:
(A)
the death benefit that the beneficiary would have received
if the employee had retired
.Q!!
the date on which the
employee began to participate in the DROP, adjusted
under subparagraph (7)(D); and
all
the balance of the employee's DROP account.
.Ll.l.)
DROP account distribution options.
A member may have the
balance of the DROP account distributed as!! lump sum or an
annuity, or have some or all paid directly to an eligible retirement
plan as !! direct rollover distribution.
If
the member dies before
the balance of the DROP account is distributed, the beneficiary
may receive distribution of the balance under any option
described in this paragraph as allowed under the Internal
Revenue Code and applicable regulations.
33-44. Pension payment options and cost-of-living adjustments.
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*
.{fil
*
*
Transfer.from Retirement Savings Plan.
A participant who transfers his or her retirement savings plan account
balance under Section 33-120 may elect to receive his or her account
balance paid as an annuity under subsection (g)(2).
33-115. Participant requirements and participant groups.
(a)
Participant Requirements.
(1)
Full-time employees.
(A)
Except as provided in paragraphs (3)[,] and (4), [and (7)]
and the last sentence of Section 33-37(e)(2), a full-time
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EXPEDITED BILL NO. 20-15
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employee eligible for membership in Group I or Group II
must participate in the Retirement Savings Plan or the
Guaranteed Retirement Income Plan when the full-time
employee meets the applicable eligibility requirements or
forfeit employment, unless the Chief Administrative
Officer exempts the employee from participation.
(B)
A part-time employee who becomes a full-time employee
and is not an active member of any retirement plan for
County employees, must become a member of:
(i)
the integrated retirement plan, if the employee is
eligible for membership. in the integrated plan;
(ii)
the Retirement Savings Plan, if the employee
qualifies for Group I or II, even if the employee did
not begin or return to County service on or after
October 1, 1994; or
(iii)
the Guaranteed Retirement Income Plan if the
employee is eligible for membership [and makes an
election].
(C) A temporary employee who becomes a full-time employee
must become an active member of:
(i)
the integrated plan, if the employee is eligible for
membership in the integrated plan;
(ii)
the Retirement Savings Plan, if the employee
satisfies the requirements for membership in Group
I or II, even if the employee did not begin or return
to County service on or after October 1, 1994; or
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EXPEDITED BILL NO. 20-15
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(iii)
the Guaranteed Retirement Income Plan if the
employee is eligible for membership in the
Guaranteed Retirement Income Plan [and makes an
election under subsection (7)].
*
(7)
*
*
[Election to participate] Participation m the Guaranteed
Retirement Income Plan.
(A)
[A full time employee hired or rehired on or after July 1,
2009 and a part time and temporary employee who
becomes full time after July 1, 2009 participate in the
guaranteed retirement income plan.
An
eligible employee
must make a one-time irrevocable election during the first
150 days of employment.
If
an eligible employee elects to
participate, participation must begin on the first pay period
after an employee has completed 180 days of full time
employment. A full time employee who does not elect to
participate in the guaranteed retirement income plan must
participate in the retirement savings plan beginning on the
first pay period after the employee has completed 180 days
of full time employment.] A participant who changes
employment from the County directly to a participating
agency or from a participating agency directly to the
County must continue to participate in his or her
retirement plan and is not eligible to make an election. A
member of the Office, Professional and Technical (OPT)
or the Service, Labor and Trades (SLT) collective
bargaining unit of the County government must participate
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EXPEDITED BILL NO. 20-15
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in the Guaranteed Retirement Income Plan, unless the
employee makes
~
one-time irrevocable election to
participate in the Retirement Savings Plan during the first
150 days of full time employment, if the employee:
ill
(ii)
is hired as
!!:
full-time employee on or after July
L.
2015; or
is
~part
time employee who does not participate in
the Retirement Savings Plan and becomes
time employee on or after July
L.
2015.
~
full-
Participation must begin on the first
~
period after an
employee has completed 180 days of full time
employment.
(B)
Except as provided m subparagraph
.{A1.
an eligible
employee must participate in the Retirement Savings Plan
unless the employee makes a one-time irrevocable election
to participate in the Guaranteed Retirement Income Plan
during the first 150 days of full-time employment.
Participation must begin on the first
~
period after an
employee has completed 180 days of full- time
employment. A part-time employee who participates in
either the Retirement Savings Plan or the Guaranteed
Retirement Income Plan when the employee becomes
!!:
full-time employee must continue to participate in the
same retirement plan.
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.cg
A part time employee who is not a participant in the
Retirement Savings Plan may make a one-time irrevocable
election to participate in the Guaranteed Retirement
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EXPEDITED BILL NO. 20-15
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Income Plan any time after the employee has completed
150 days of employment.
(b)
Participants groups and eligibility.
(1)
Group
I.
Except as provided in the last sentence of Section 33-
37(e)(2), any full-time or career part-time employee meeting the
criteria in paragraphs (A) or (B) must participate in the retirement
savings plan if the employee begins, or returns to, County service
on or after October 1, 1994. An employee hired on or after July
1, 2009 must be employed on a full time or part time basis with
the County for 180 days before participating in the Retirement
Savings Plan. An individual who changes employment from the
County government directly to a participating agency or from a
participating agency directly to the County government must
continue to participate in the same retirement plan. Participation
in the Retirement Savings Plan must begin on the first payroll
after an employee has completed 180 days of employment if the
employee:
(A)
(i)
is not represented by [[an]]
~County
government
employee organization;
(ii)
does not occupy a County government bargaining
unit position;
(iii)
(iv)
is not a public safety employee; and
does not elect to participate in the Guaranteed
Retirement Income Plan; or
(B)
(i)
(ii)
is not a public safety employee; and
is subject to the terms· of a collective bargaining
agreement between the County and an employee
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EXPEDITED BILL NO. 20-15
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organization which requires the employee to
participate in the [retirement savings] Guaranteed
Retirement Income Plan if the employee does not
elect to participate in the [guaranteed retirement
income] Retirement Savings Plan; and
(iii)
[does not elect] elects to participate m the
Retirement Savings Plan (guaranteed retirement
income plan].
*
33-120.
*
*
*
*
Distribution of Benefit.
*
(f)
Distribution methods.
The Chief Administrative Officer must pay, at
the request of the participant or the designated beneficiary, a
participant's account balances in the retirement savings plan upon
retirement, disability retirement, death, or separation from County
service.
*
*
*
Optional method
Q[
distribution
=
Transfer
to Employees
'
Retirement System, Annuity Option.
A participant may elect to
have the participant's entire account balance transferred to the
employees' retirement system and have the account balance paid
in one of the annuity options available under Section 33-44(g)(2).
*
*
*
Sec. 2. Expedited Effective Date.
The Council declares that this legislation
is necessary for the immediate protection of the public interest. This Act takes effect
on July 1, 2015.
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EXPEDITED BILL NO. 20-15
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Isiah Leggett, County Executive
Date
Approved:
Approved:
~~
George Leventhal, President, County Council
<>/i-t
Li.a
IS
Date
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378
This is a correct copy of Council action.
Linda M. Lauer, Clerk of the Council
Date
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