HOUSE BILL No. 4126


     February 2, 1999, Introduced by Rep. Faunce and referred to the Committee on Local Government and Urban Policy.


        A bill to regulate benefits provided to certain public

   employee retirement system participants in this state; and to

   prescribe powers and duties of certain retirement systems, state

   departments, public officials, and public employees.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 1         Sec. 1.  This act shall be known and may be cited as the

 2    "public employee retirement benefit regulation act".

 3         Sec. 2.  (1) For the purposes of this act, the words and

 4    phrases defined in this section have the meanings ascribed to

 5    them in this section.

 6         (2) "Benefit" means an annuity, a pension, a retirement

 7    allowance, or an optional benefit accrued or accruing to a par-

 8    ticipant under a retirement system.

 9         (3) "Participant" means a member, deferred member, or vested

10    former member of a retirement system.


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 1         (4) "Retirement system" means a public employee retirement

 2    system created and established by a political subdivision of this

 3    state.

 4         Sec. 3.  (1) Notwithstanding any other provision of law,

 5    rule, ordinance, or resolution to the contrary, beginning on the

 6    effective date of this act, a retirement system shall not use the

 7    final compensation of a participant to calculate the

 8    participant's benefit as a retirant under the retirement system,

 9    unless the participant has received that final compensation

10    amount for a period of 6 months or more before the effective date

11    of retirement.  If the participant has not received the final

12    compensation amount for 6 months or more, the retirement system

13    shall use the average of the participant's compensation received

14    over a period of 12 months before the effective date of

15    retirement.

16         (2) This section does not apply to any of the following:

17         (a) A retirement system that uses a final average compensa-

18    tion amount in the benefit calculation, which calculation aver-

19    ages compensation received by a participant over a period of 12

20    months or more before the effective date of retirement.

21         (b) A participant whose final compensation is less than a

22    compensation amount previously received for employment under that

23    retirement system for a period of 12 months or more before the

24    effective date of retirement.









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