HB-4766, As Passed Senate, June 14, 2007
May 16, 2007, Introduced by Reps. Gonzales and Cushingberry and referred to the Committee on Appropriations.
A bill to amend 1965 PA 314, entitled
"Public employee retirement system investment act,"
by amending section 20m (MCL 38.1140m), as added by 2002 PA 728.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 20m. The governing board vested with the general
administration, management, and operation of a system or other
decision-making body that is responsible for implementation and
supervision of any system shall confirm in the annual actuarial
valuation and the summary annual report required under section
20h(2) that each plan under this act provides for the payment of
the required employer contribution as provided in this section and
shall confirm in the summary annual report that the system has
received the required employer contribution for the year covered in
the summary annual report. The required employer contribution is
the actuarially determined contribution amount. An annual required
employer contribution in a plan under this act shall consist of a
current service cost payment and a payment of at least the annual
accrued amortized interest on any unfunded actuarial liability and
the payment of the annual accrued amortized portion of the unfunded
principal liability. For fiscal years that begin before January 1,
2006, the required employer contribution shall not be determined
using
an amortization period greater than 40 years. For Except as
otherwise provided in this section, for fiscal years that begin
after December 31, 2005, the required employer contribution shall
not be determined using an amortization period greater than 30
years. For the state employees retirement system, the public school
employees retirement system, and the state police retirement system
only, for the fiscal year beginning October 1, 2006, the
contribution for the unfunded actuarial accrued liability shall be
equal to the product of the assumed real rate of investment return
times the unfunded actuarial accrued liability. In a plan year, any
current service cost payment may be offset by a credit for
amortization of accrued assets, if any, in excess of actuarial
accrued liability. A required employer contribution for a plan
administered under this act shall allocate the actuarial present
value of future plan benefits between the current service costs to
be paid in the future and the actuarial accrued liability. The
governing board vested with the general administration, management,
and operation of a system or other decision-making body of a system
shall act upon the recommendation of an actuary and the board and
the actuary shall take into account the standards of practice of
the actuarial standards board of the American academy of actuaries
in making the determination of the required employer contribution.