Bill 1178

                    Current Status

Bill Number:               1178
Ratification Number:       528
Act Number                 475
Introducing Body:          Senate
Subject:                   Service retirement benefits

(A475, R528, S1178)

AN ACT TO AMEND SECTION 9-1-1550, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO SERVICE RETIREMENT ALLOWANCES FOR MEMBERS OF THE SOUTH CAROLINA RETIREMENT SYSTEM, SO AS TO INCREASE THE MULTIPLIER FRACTION USED IN CALCULATING SERVICE RETIREMENT BENEFITS FROM ONE PERCENT OF THE FIRST FOUR THOUSAND EIGHT HUNDRED DOLLARS OF AVERAGE FINAL COMPENSATION AND ONE AND THREE-TENTHS PERCENT OF AVERAGE FINAL COMPENSATION IN EXCESS OF FOUR THOUSAND EIGHT HUNDRED DOLLARS TO ONE AND THIRTY-FIVE HUNDREDTHS PERCENT OF AVERAGE FINAL COMPENSATION IN THE CASE OF CLASS ONE MEMBERS AND FROM ONE AND TWENTY-FIVE HUNDREDTHS PERCENT OF THE FIRST FOUR THOUSAND EIGHT HUNDRED DOLLARS OF AVERAGE FINAL COMPENSATION AND ONE AND SIXTY-FIVE HUNDREDTHS PERCENT OF AVERAGE FINAL COMPENSATION IN EXCESS OF FOUR THOUSAND EIGHT HUNDRED DOLLARS TO ONE AND SEVEN-TENTHS PERCENT OF AVERAGE FINAL COMPENSATION IN THE CASE OF CLASS TWO MEMBERS; TO AMEND SECTION 9-1-1020, RELATING TO CONTRIBUTIONS TO THE SOUTH CAROLINA RETIREMENT SYSTEM, SO AS TO INCREASE EMPLOYEE CONTRIBUTIONS FROM THREE PERCENT OF THE FIRST FOUR THOUSAND EIGHT HUNDRED DOLLARS OF EARNABLE COMPENSATION AND FIVE PERCENT OF EARNABLE COMPENSATION IN EXCESS OF FOUR THOUSAND EIGHT HUNDRED DOLLARS TO FIVE PERCENT OF ALL EARNABLE COMPENSATION IN THE CASE OF CLASS ONE MEMBERS, AND FROM FOUR PERCENT OF THE FIRST FOUR THOUSAND EIGHT HUNDRED DOLLARS OF EARNABLE COMPENSATION AND SIX PERCENT OF EARNABLE COMPENSATION IN EXCESS OF FOUR THOUSAND EIGHT HUNDRED DOLLARS TO SIX PERCENT OF ALL EARNABLE COMPENSATION IN THE CASE OF CLASS TWO MEMBERS; TO AMEND THE 1976 CODE BY ADDING SECTION 9-1-1767 SO AS TO INCREASE RETIREMENT BENEFITS PAYABLE DUE TO RETIREMENT BEFORE JULY 1, 1988, BY TEN PERCENT, AND TO MAKE ALL THE PROVISIONS OF THIS ACT EFFECTIVE JULY 1, 1988.

Be it enacted by the General Assembly of the State of South Carolina:

Service retirement benefits

SECTION 1. (A) Section 9-1-1550(A)(3) of the 1976 Code is amended to read:

"(3) If he has a prior service certificate in full force and effect, an additional employer annuity which must be equal to the employee annuity which would have been provided at age sixty-five or at age of retirement, whichever is less, by twice the contributions which he would have made during his entire period of prior service had the System been in operation and had he contributed thereunder during such entire period.

Upon retirement from service on or after July 1, 1988, a Class One member shall receive a service retirement allowance computed as follows: If the member's service retirement date occurs on or after his sixty-fifth birthday, or after he has completed thirty or more years of creditable service, the allowance must be equal to one and thirty-five hundredths percent of his average final compensation multiplied by the number of years of his creditable service.

If the member's service retirement date occurs before his sixty-fifth birthday and before he completes thirty years of creditable service, his service retirement allowance is computed as above, but is reduced by five-twelfths of one percent thereof for each month by which his retirement date precedes the first day of the month, prorated for periods less than a month, coincident with or next following his sixty-fifth birthday.

Notwithstanding the foregoing provisions, any Class One member who retires on or subsequent to July 1, 1976, shall receive not less than the

benefit provided under the formula in effect prior to July 1, 1976."

(B) Section 9-1-1550(B) of the 1976 Code is amended to read:

"(B) Upon retirement from service on or after July 1, 1988, a Class Two member shall receive a service retirement allowance computed as follows:

(1) If the member's service retirement date occurs on or after his sixty-fifth birthday or after he has completed thirty or more years of creditable service, the allowance must be equal to one and seven-tenths percent of his average final compensation, multiplied by the number of years of his creditable service.

(2) If the member's service retirement date occurs before his sixty-fifth birthday and before he completes the thirty years of creditable service, his service retirement allowance is computed as in item (1) above but is reduced by five-twelfths of one percent thereof for each month, prorated for periods less than a month, by which his retirement date precedes the first day of the month coincident with or next following his sixty-fifth birthday.

(3) Notwithstanding the foregoing provisions, any Class Two member whose creditable service commenced prior to July 1, 1964, shall receive not less than the benefit provided by subsection (A) of this section."

Retirement contribution

SECTION 2. The third paragraph of Section 9-1-1020 of the 1976 Code is amended to read:

"The rates of the deductions must be, without regard to a member's coverage under the Social Security Act, as follows: in the case of Class One members, five percent of earnable

compensation and, in the case of Class Two members, six percent of earnable compensation."

Benefits increased

SECTION 3. Article 13, Chapter 1, Title 9 of the 1976 Code is amended by adding:

"Section 9-1-1767. Effective July 1, 1988, the benefits payable due to retirement before July 1, 1988, must be increased by ten percent."

Time effective

SECTION 4. This act takes effect July 1, 1988.