SB-0132, As Passed Senate, February 24, 2010

SUBSTITUTE FOR

SENATE BILL NO. 132

A bill to amend 1992 PA 234, entitled

"The judges retirement act of 1992,"

by amending sections 714 and 715 (MCL 38.2664 and 38.2665), section

714 as amended by 2002 PA 95 and section 715 as amended by 1999 PA

215.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 714. (1) This section is subject to the vesting

requirements of section 715.

(2) A qualified participant's employer shall contribute to the

qualified participant's account in Tier 2 an amount equal to 4% of

the qualified participant's salary.

(3) A qualified participant may periodically elect to

contribute up to 3% of his or her salary to his or her Tier 2

account. The qualified participant's employer shall make an

additional contribution to the qualified participant's Tier 2

account in an amount equal to the contribution made by the

qualified participant under this subsection.

(4) A qualified participant may make contributions in addition

to contributions made under subsection (3) to his or her Tier 2

account as permitted by the state treasurer and the internal

revenue code. The qualified participant's employer shall not match

contributions made by the qualified participant under this

subsection.

(5) A qualified participant who makes a written election under

section 701a may elect to contribute up to 6% of his or her salary

to his or her Tier 2 account. In lieu of employer contributions

under subsection (3), the qualified participant's employer shall

make an additional contribution to the qualified participant's Tier

2 account in an amount equal to the contribution made by the

qualified participant under this subsection. This subsection

applies for a period as determined by the department that equals

the time in which a Tier 1 member was not able to make

contributions to the Tier 2 plan because of the temporary

restraining order issued in the case of Michigan judges assn v

Treasurer of the State of Michigan, case no. 98-DT-72771-CV (Ed

Mi).

(6) Beginning January 1, 2002, each qualified participant who

was first eligible to become a qualified participant on or before

November 1, 2010 and who is a plan 1 member or a plan 2 member,

upon taking office and so long as he or she remains in office,

shall contribute 2.0% of the qualified participant's compensation

to the retirement system. The retirement system shall deposit the

contribution under this subsection into the reserve for health

benefits for hospital and medical-surgical and sick care benefits

as provided in section 719.

Sec. 715. (1) A qualified participant is immediately 100%

vested in his or her contributions made to Tier 2. A qualified

participant shall vest in the employer contributions made on his or

her behalf to Tier 2 according to the following schedule:

(a) Upon completion of 2 years of service, 50%.

(b) Upon completion of 3 years of service, 75%.

(2) A qualified participant who was first eligible to become a

qualified participant on or before November 1, 2010 is vested in

the health insurance coverage provided in section 719 if the

qualified participant meets 1 of the following requirements:

(a) The qualified participant has completed 4 years of service

as a qualified participant and was not a member, deferred vested

member, or former nonvested member of Tier 1.

(b) The qualified participant was a member, deferred vested

member, or former nonvested member of Tier 1 who made an election

to participate in Tier 2 pursuant to section 701 or 701a, and who

has met the service requirements he or she would have been required

to meet in order to vest in health benefits under section 509.

Enacting section 1. This amendatory act does not take effect

unless House Bill No. 4194 of the 95th Legislature is enacted into

law.