HOUSE BILL No. 6121


     November 9, 2000, Introduced by Reps. Shackleton, DeHart, Woronchak, Jellema, Voorhees, Richardville, Sanborn, Toy,
Faunce, Tabor, Julian, Howell, Ehardt, Gilbert, Kowall and Neumann and referred to the Committee on Senior Health, Security and
Retirement.


        A bill to amend 1937 PA 345, entitled

   "Fire fighters and police officers retirement act,"

   by amending sections 6, 6a, and 6b (MCL 38.556, 38.556a, and

   38.556b), section 6 as amended by 1991 PA 54, section 6a as

   amended by 1982 PA 145, and section 6b as added by 1986 PA 30.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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           Sec. 6.  (1) Age and service retirement benefits payable

 2
      under this act are as follows:

 3
           (a) A member who is 55 years of age or older and who has 25

 4
      or more years of service as a police officer or fire fighter in

 5
      the employ of the municipality affected by this act may retire

 6
      from service upon written application to the retirement board

 7
      stating a date, not less than 30 days or more than 90 days after

 8
      the execution and filing of the application, on which the member

 9
      desires to be retired.  The retirement board shall grant the


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      benefits to which the member is entitled under this act, unless

 2
      the member continues employment.  If the member continues employ-

 3
      ment, the member's pension shall be deferred with service years

 4
      of credit until actual retirement.  Upon the approval of the leg-

 5
      islative body or the electors of a municipality under this act, a

 6
      member under 50 years of age who has 25 or more years of service,

 7
      or without the necessity for approval, a member 50 years of age

 8
      or more who has 25 or more years of service, may leave service

 9
      and receive the full retirement benefits payable throughout the

10
      member's life as provided in subdivision (e).

11
           (b) A member who is 60 years of age or older shall be

12
      retired by the retirement board upon the written application of

13
      the legislative body, or board or official provided in the

14
      charter of the municipality as head of the department in which

15
      the member is employed.  Upon retirement, the retirement board

16
      shall grant the benefits to which the member is entitled under

17
      this act, unless the member continues employment.  If the member

18
      continues employment, the member's pension shall be deferred with

19
      service years of credit until actual retirement.

20
           (c) A member who is 65 years of age shall be retired by the

21
      retirement board on the first day of the month following attain-

22
      ment of 65 years of age.

23
           (d) A member who has 10 or more years of service shall have

24
      vested retirement benefits that are not subject to forfeiture on

25
      account of disciplinary action, charges, or complaints.  If the

26
      member leaves employment before the date the member would have

27
      first become eligible to retire as provided in subdivision (a)



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      for any reason except the member's retirement or death, the

 2
      member is entitled to a pension that shall begin the first day of

 3
      the calendar month immediately after the month in which the

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      member's written application for the pension is filed with the

 5
      retirement board that is on or after the date the member would

 6
      have been eligible to retire had the member continued in

 7
      employment.  The retirement board shall grant the member the ben-

 8
      efits to which the member is entitled under this act, unless the

 9
      member resumes service.  If the member resumes service, the

10
      member's pension shall be further deferred with service years of

11
      credit until the member actually retires.

12
           (e) Upon retirement from service as provided in this subsec-

13
      tion, a member shall receive a regular retirement pension payable

14
      throughout the member's life of 2% of the member's average final

15
      compensation multiplied by the first 25 years of service credited

16
      to the member, plus 1% of the member's average final compensation

17
      multiplied by the number of years, and fraction of a year, of

18
      service rendered by the member in excess of 25 years.  A munici-

19
      pality under this act, upon approval of the legislative body or

20
      the electors of the municipality, may increase the percentage of

21
      the payment from 2% up to a maximum of 2.5%.  If an increase is

22
      approved, the increase shall not be reduced for members under the

23
      system at the time of the increase.  The legislative body may

24
      also increase the percentage of employee contributions.  If a

25
      retired member dies before the total of regular pension payments

26
      received by the member equals the total of the member's

27
      contributions made to the retirement system, the difference



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      between the member's total contributions and the total of the

 2
      member's regular retirement pension payments received shall be

 3
      paid in a single sum to the person or persons the member nomi-

 4
      nates by written designation duly executed and filed with the

 5
      retirement board.  If there is not a person or persons surviving

 6
      the retired member, the difference, if any, shall be paid to the

 7
      retired member's legal representative or estate.

 8
           (f) As used in this section, "average final compensation"

 9
      means the average of the highest annual compensation received by

10
      a member during a period of 5 consecutive years of service con-

11
      tained within the member's 10 years of service immediately pre-

12
      ceding the member's retirement or leaving service.  However, if

13
      so provided in a collective bargaining agreement entered into

14
      between a municipality under this act and the appropriate recog-

15
      nized bargaining agent, average final compensation may mean the

16
      average of the 3 years of highest annual compensation received by

17
      a member during the member's 10 years of service immediately pre-

18
      ceding the member's retirement or leaving service.  If the member

19
      has less than 5 years of service, average final compensation

20
      means the annual average compensation received by the member

21
      during his or her total years of service.

22
           (g) A member shall be given service credit for time spent in

23
      the military, naval, marine, or other armed service of the United

24
      States government during time of war, or other national emergency

25
      recognized by the board, if the member was employed by the munic-

26
      ipality at the time of entry into the armed service, and is or

27
      was reemployed by the municipality as a police officer or fire



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      fighter within 6 months after the date of termination of his or

 2
      her required enlistment or assignment in the armed service.  A

 3
      municipality by a 3/5 vote of its governing body or by a majority

 4
      vote of the qualified electors may provide service credit for not

 5
      more than 6 years of active military service to the United States

 6
      government to a member who is employed subsequent to this mili-

 7
      tary service upon payment to the retirement system of 5% of the

 8
      member's full-time or equated full-time compensation for the

 9
      fiscal year in which payment is made multiplied by the years of

10
      service that the member elects to purchase up to the maximum.

11
      Service is not creditable if it is or would be creditable under

12
      any other federal, state, or local publicly supported retirement

13
      system.  However, this restriction does not apply to those per-

14
      sons who have or will have acquired retirement eligibility under

15
      the federal government for service in the reserve.  A member

16
      shall be given service credit for the time the member is absent

17
      from active service without full pay on account of sickness or

18
      injury.  If the absence from active service is due to nonservice

19
      connected sickness or injury, not more than 60 days of the

20
      absence shall be credited as service in any 1 calendar year, as

21
      determined by the retirement board.

22
           (h) Before the effective date of the member's retirement as

23
      provided in this subsection, but not after the effective date of

24
      the member's retirement, a member may elect to receive his or her

25
      benefit in a pension payable throughout the member's life, called

26
      a regular retirement pension, or the member may elect to receive

27
      the actuarial equivalent, computed as of the effective date of



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      retirement, of the member's regular retirement pension in a

 2
      reduced retirement pension payable throughout the member's life,

 3
      and nominate a survivor beneficiary,  pursuant to  UNDER an

 4
      option provided in this subdivision.  Upon the death of a retir-

 5
      ant who retires on or after July 1, 1975, and who is receiving a

 6
      regular retirement pension, his or her spouse, if living, shall

 7
      receive a pension equal to 60% of the regular retirement pension

 8
      the deceased retirant was receiving.  Benefits shall not be paid

 9
      under this subdivision on account of the death of a retirant if

10
      the member elected to receive his or her pension under an option

11
      provided in this subdivision.  As used in this subsection,

12
      "spouse" means the person to whom the retirant was legally mar-

13
      ried on both the effective date of retirement and the date of

14
      death.  Except as otherwise provided in this act, if a member

15
      fails to elect an option before the effective date of retirement,

16
      then the pension shall be paid as a regular retirement pension.

17
      A member may elect 1 of the following options:

18
           (i) Option I.  Upon the death of a retired member, his or

19
      her reduced retirement pension shall be continued throughout the

20
      life of and paid to the person, having an insurable interest in

21
      the retired member's life, that the member nominated by written

22
      designation  duly  executed and filed with the retirement board

23
      before the effective date of the member's retirement.

24
           (ii) Option II.  Upon the death of a retired member, 1/2 of

25
      his or her reduced retirement pension shall be continued through-

26
      out the life of and paid to the person, having an insurable

27
      interest in the retired member's life, that the member nominated



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      by written designation  duly  executed and filed with the

 2
      retirement board before the effective date of the member's

 3
      retirement.

 4
           (i) If a member continues in service on or after the date of

 5
      acquiring 20 years of service credit, does not have an option I

 6
      election provided for in subdivision (j) in force, and dies while

 7
      in service of the municipality before the effective date of the

 8
      member's retirement, leaving a surviving spouse, the spouse shall

 9
      receive a pension computed in the same manner as if the member

10
      had retired effective the day preceding the date of the member's

11
      death, elected option I provided for in subdivision (h), and nom-

12
      inated the spouse as survivor beneficiary.  Upon the death of the

13
      spouse the pension shall terminate.  A pension shall not be paid

14
      under this subdivision on account of the death of a member if

15
      benefits are paid under subsection (2) on account of the member's

16
      death.

17
           (j) A member who continues in service on or after the date

18
      of acquiring 25 years of service credit may, at any time before

19
      the effective date of the member's retirement, by written decla-

20
      ration  duly  executed and filed with the board in the manner and

21
      form prescribed by the board, elect option I provided for in sub-

22
      division (h) and nominate a survivor beneficiary whom the board

23
      finds to be dependent upon the member for at least 50% of the

24
      beneficiary's support.  If a member who has an option I election

25
      provided for in this subdivision in force dies while in service

26
      before the effective date of the member's retirement, the

27
      member's survivor beneficiary shall immediately receive the same



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      pension that the survivor beneficiary would have been entitled to

 2
      receive under  the  option I if the member had retired pursuant

 3
      to this act effective the day preceding the date of the member's

 4
      death, notwithstanding that the member may not have attained 55

 5
      years of age.  If a member who has an option I election provided

 6
      for in this subdivision in force subsequently retires pursuant to

 7
      this act, the member, within 90 days immediately preceding the

 8
      effective date of the member's retirement, but not after the

 9
      effective date of the member's retirement, may elect an option

10
      provided for in subdivision (h).  The option election is effec-

11
      tive as of the effective date of the member's retirement.  A pen-

12
      sion shall not be paid under this subdivision on account of the

13
      death of a member if benefits are paid under subsection (2) on

14
      account of the member's death.

15
           (k) If a retirant receiving a reduced retirement pension

16
      under subdivision (h)(i) or (ii) is divorced from the spouse who

17
      had been named the retirant's survivor beneficiary under subdivi-

18
      sion (h)(i) or (ii), the election of a reduced retirement pension

19
      payment option shall be considered void by the retirement system

20
      if the judgment of divorce or award or order of the court, or an

21
      amended judgment of divorce or award or order of the court,

22
      described in section 9 and dated after the effective date of the

23
      amendatory act that added this subdivision provides that the

24
      election of a reduced retirement pension payment option under

25
      subdivision (h)(i) or (ii) is to be considered void by the

26
      retirement system and the retirant provides a certified copy of

27
      the judgment of divorce or award or order of the court, or an



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      amended judgment of divorce or award or order of the court, to

 2
      the retirement system.  If the election of a reduced retirement

 3
      pension payment option under subdivision (h)(i) or (ii) is con-

 4
      sidered void by the retirement system under this subsection, the

 5
      retirant's retirement pension shall revert to a regular retire-

 6
      ment pension, including postretirement adjustments, if any,

 7
      subject to an award or order of the court as described in section

 8
      9.  The retirement pension shall revert to a regular retirement

 9
      pension under this subdivision effective the first DAY of the

10
      month after the date the retirement system receives a certified

11
      copy of the judgment of divorce or award or order of the court.

12
      This subdivision does not supersede a judgment of divorce or

13
      award or order of the court in effect on the effective date of

14
      the amendatory act that added this subdivision.  This subdivision

15
      does not require the retirement system to distribute or pay

16
      retirement assets on behalf of a retirant in an amount that

17
      exceeds the actuarially determined amount that would otherwise

18
      become payable if a judgment of divorce had not been rendered.

19
           (2) Disability and service connected death benefits payable

20
      under this act are as follows:

21
           (a) To a surviving spouse, a duty death pension of the same

22
      amount each week as that which has been paid the surviving spouse

23
      under the worker's disability compensation act of 1969,  Act

24
      No. 317 of the Public Acts of 1969, being sections 418.101 to

25
      418.941 of the Michigan Compiled Laws  1969 PA 317, MCL 418.101

26
      TO 418.941, to become due and payable on the termination of the

27
      payments to the surviving spouse by a municipality under  Act



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      No. 317 of the Public Acts of 1969  THE WORKER'S DISABILITY

 2
      COMPENSATION ACT OF 1969, 1969 PA 317, MCL 418.101 TO 418.941,

 3
      and to continue for the surviving spouse's life.  or until his or

 4
      her remarriage. 

 5
           (b) If death results to a member in the line of duty, and

 6
      the member leaves surviving children, the children shall be paid

 7
      a pension of the same amount as that which has been paid to them

 8
      as a weekly benefit under  Act No. 317 of the Public Acts of

 9
      1969  THE WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969 PA

10
      317, MCL 418.101 TO 418.941, to become due and payable upon ter-

11
      mination of the payments under  Act No. 317 of the Public Acts of

12
      1969  THE WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969 PA

13
      317, MCL 418.101 TO 418.941, and to continue to each surviving

14
      child until he or she attains 18 years of age, or until his or

15
      her marriage or death before attaining 18 years of age.

16
           (c) If death results to a member in the line of duty and the

17
      member leaves other surviving dependents, the dependents shall

18
      receive a pension of the same amount as that which has been paid

19
      to them as a weekly benefit under  Act No. 317 of the Public Acts

20
      of 1969  THE WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969

21
      PA 317, MCL 418.101 TO 418.941, to become due and payable upon

22
      termination of the payments under  Act No. 317 of the Public Acts

23
      of 1969  THE WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969

24
      PA 317, MCL 418.101 TO 418.941, and to continue until the time

25
      the retirement board determines that the need for a pension no

26
      longer exists.





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           (d) Upon the application of a member or the member's

 2
      department head, a member who becomes totally incapacitated for

 3
      duty by reason of a personal injury or disease occurring as the

    4 natural and proximate result of causes arising out of and in the

 5
      course of the member's employment by the municipality shall be

 6
      retired by the retirement board.  The member shall be given a

 7
      medical examination by a medical committee consisting of a physi-

 8
      cian named by the retirement board, a physician named by the

 9
      member claiming benefits, and a third physician designated by the

10
      first 2 physicians named.  The medical committee, if determined

11
      by a majority opinion, shall certify in writing that the member

12
      is mentally or physically incapacitated for the further per-

13
      formance of duty as a police officer or fire fighter in the serv-

14
      ice of the municipality; that the incapacity is likely to be per-

15
      manent; and that the member should be retired.  Upon retirement

16
      for disability as provided in this subdivision, a member who has

17
      not attained 55 years of age shall receive a disability retire-

18
      ment pension of 50% of the member's average final compensation,

19
      which shall be determined according to subsection (1)(f), and

20
      shall be payable until the member becomes 55 years of age.  Upon

21
      becoming 55 years of age, the disabled member shall receive a

22
      disability retirement pension computed according to subsection

23
      (1)(e).  In computing the disability retirement pension, the

24
      member shall be given service credit for the period of receipt of

25
      a disability retirement pension before attainment of 55 years of

26
      age.  If a member retired after attaining 55 years of age on

27
      account of disability, as provided in this subdivision, the



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      member shall receive a disability retirement pension computed

 2
      according to subsection (1)(e), notwithstanding that the member

 3
      may not have 25 years of service credit.  The disability retire-

 4
      ment pension provided for in this subdivision is subject to sub-

 5
      divisions (f) and (g).

 6
           (e) Upon the application of a member or the member's depart-

 7
      ment head, a member in service who has 5 or more years of service

 8
      credit and who becomes totally and permanently incapacitated for

 9
      duty by reason of a personal injury or disease occurring as the

10
      result of causes arising outside the course of the member's

11
      employment by the municipality may be retired by the retirement

12
      board.  The member shall be given a medical examination by a med-

13
      ical committee consisting of a physician named by the retirement

14
      board, a physician named by the member claiming benefits, and a

15
      third physician designated by the first 2 physicians named.  The

16
      medical committee, if determined by a majority opinion, shall

17
      certify in writing that the member is mentally or physically

18
      incapacitated for the further performance of duty as a police

19
      officer or fire fighter in the service of the municipality, that

20
      the incapacity is likely to be permanent, and that the member

21
      should be retired.  Upon retirement for disability, as provided

22
      in this subdivision, a member who has not attained 55 years of

23
      age shall receive a disability retirement pension until the

24
      member becomes 55 years of age, recovers, or dies, whichever

25
      occurs first, of 1.5% of the member's average final compensation

26
      multiplied by the number of years of service credited to the

27
      member.  Upon becoming 55 years of age, the member's disability



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      retirement pension shall be increased to 2% of the member's

 2
      average final compensation multiplied by the number of years of

 3
      service credited to the member at the time of his or her

 4
      retirement.  Upon retirement for disability as provided in this

 5
      subdivision, a member who is 55 years of age or older shall

 6
      receive a disability retirement pension computed according to

 7
      subsection (1)(e).  This subdivision is subject to subdivisions

 8
      (f) and (g).

 9
           (f) At least once each year during the first 5 years after

10
      the retirement of a member with a disability retirement pension

11
      and at least once in every 3-year period after disability retire-

12
      ment, the retirement board may, and upon the retired member's

13
      application shall, require a retired member who has not attained

14
      55 years of age to undergo a medical examination.  The medical

15
      examination shall be given by or under the direction of a physi-

16
      cian, designated by the retirement board, at the place of resi-

17
      dence of the retired member or other place mutually agreed upon.

18
      If a retired member who has not attained 55 years of age refuses

19
      to submit to the medical examination in the period, the member's

20
      disability retirement pension may be discontinued by the retire-

21
      ment board.  If the member's refusal continues for 1 year, all

22
      the member's rights  in and  to his or her disability retirement

23
      pension may be revoked by the retirement board.  If upon a medi-

24
      cal examination of the retired member the physician reports to

25
      the retirement board that the retired member is physically  able

26
      and  capable of resuming employment in the classification held by

27
      the member at the time of retirement, the member shall be



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      restored to active service in the employ of the municipality and

 2
      payment of the disability retirement pension shall cease if the

 3
      report of the physician is concurred in by the retirement board.

 4
      A retired member restored to active service shall again become a

 5
      member of the retirement system from the date of return to

 6
      service.  The member shall contribute to the retirement system

 7
      after restoration to active service in the same manner as before

 8
      the member's disability retirement.  Service credited to the

 9
      member at the time of disability retirement shall be restored to

10
      full  force and  effect.  The member shall be given service

11
      credit for the period the member was receiving a duty disability

12
      retirement pension provided for in subdivision (d), but shall not

13
      be given service credit for the period the member was receiving a

14
      nonduty disability retirement pension provided for in subdivision

15
      (e).  Amounts paid under  Act No. 317 of the Public Acts of 1969 

16
      THE WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969 PA 317,

17
      MCL 418.101 TO 418.941, to a retired member shall be offset

18
      against and payable in place of benefits provided under this

19
      act.  If the benefits under  Act No. 317 of the Public Acts of

20
      1969  THE WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969 PA

21
      317, MCL 418.101 TO 418.941, are less than the benefits payable

22
      under this act, the amount to be paid out of the funds of the

23
      retirement system shall be the difference between the benefits

24
      provided under  Act No. 317 of the Public Acts of 1969  THE

25
      WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969 PA 317, MCL

26
      418.101 TO 418.941, and the benefits provided in this act.  Upon

27
      the termination of benefits under  Act No. 317 of the Public Acts



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 1
      of 1969  THE WORKER'S DISABILITY COMPENSATION ACT OF 1969, 1969

 2
      PA 317, MCL 418.101 TO 418.941, the benefits shall be paid pursu-

 3
      ant to this act.

 4
           (g) Within 60 days before a member becomes 55 years of age,

 5
      or before retirement from service if retirement occurs after the

 6
      member becomes 55 years of age, a disabled member who is retired

 7
      as provided in subdivision (d) or (e) may elect to continue to

 8
      receive a disability retirement pension as a benefit terminating

 9
      at death, to be known as a regular disability pension, or may

10
      elect to receive the actuarial equivalent, at that time, of a

11
      regular disability pension in a reduced disability pension pay-

12
      able throughout life pursuant to an option provided in subsection

13
      (1)(h).  If a disabled member fails to elect an option, as pro-

14
      vided in this subdivision, before becoming 55 years of age or

15
      before retirement, the member's retirement pension shall be paid

16
      to the member as a regular disability pension terminating at

17
      death.  If a disabled member who has not elected an option pro-

18
      vided in subsection (1)(h) dies before the total of the member's

19
      regular disability pension payments received equals or exceeds

20
      the total of the member's contributions made to the retirement

21
      system, the remainder, if any, shall be paid in a single sum to

22
      the person or persons nominated by the member by written designa-

23
      tion duly executed and filed with the board.  If there is not a

24
      designated person or persons surviving, then the remainder, if

25
      any, shall be paid to the retired member's legal representative

26
      or estate.





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           Sec. 6a.  (1)  In a municipality having a population of

 2
      80,000 or more, section 6(1)(h) shall be applicable to any member

 3
      who continues in service on or after the date he or she acquires

 4
      15 years of service credit.

 5
            (2) After December 31, 1981, in a city completely sur-

 6
      rounded by a city having a population of 80,000 or more which

 7
      elects by a resolution of its governing body to be included under

 8
      this subsection, a pension computed as provided in section

 9
      6(1)(i) shall be paid to the surviving spouse of a member who

10
      continues in service on or after the date the member acquires 15

11
      years of service credit, who does not have an option I election

12
      as provided in section 6(1)(h), and who dies while in the service

13
      of the city before the effective date of the member's

14
      retirement. 

15
           Sec. 6b.  (1)  Notwithstanding section 6 or any predecessor

16
      to section 6,  and subject to subsection (2),  the remarriage of

17
      a surviving spouse shall not render the surviving spouse ineligi-

18
      ble to receive a pension described in section 6(1)(i) or a duty

19
      death pension described in section 6(2)(a).  A surviving spouse

20
      whose pension described in section 6(1)(i) or duty death pension

21
      described in section 6(2)(a) was terminated due to the surviving

22
      spouse's remarriage shall be eligible to receive that pension or

23
      duty death pension beginning on the first day of the month fol-

24
      lowing the month in which written application for reinstatement

25
      is filed with the board, but shall not be eligible to receive the

26
      pension or duty death pension attributable to any month beginning

27
      before the month of reinstatement under this section.



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            (2) Subsection (1) shall apply to a municipality upon

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      approval by resolution of the governing body of the

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      municipality. 


















































   06699'00          Final page.                            MRM