Introduced Version
SENATE BILL No. 250
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 5-1-14-15; IC 5-10.2; IC 5-10.3; IC 5-10.4;
IC 5-11-20-6.
Synopsis: Pension matters. Modifies the definition of "average of the
annual compensation" for a member of the public employees'
retirement fund (PERF) who retires after December 31, 2026. Specifies
that compensation received in contemplation of retirement is excluded
from the average of the annual compensation for particular members
of PERF and the Indiana state teachers' retirement fund (TRF).
Provides that a specified monthly pension benefit provided to a
member of PERF whose creditable service was earned only as an
elected official may not be less than $180. Repeals a provision
requiring the board of trustees of the Indiana public retirement system
(board) to maintain separate accounts for each unit of local
government. Provides that amounts forfeited under the public
employees defined contribution plan must be used as determined by the
board. (Current law requires these amounts to be used to reduce the
unfunded accrued liability of PERF.) Specifies a process by which a
fully vested member of the public employees' defined contribution plan
or the teachers' defined contribution plan may irrevocably elect to
participate in PERF or TRF, as applicable. Modifies the information
that must be included in a delinquency notice to a delinquent political
subdivision. Specifies that a delinquent political subdivision may not
be required to make a presentation to the interim study committee on
pension management oversight more than one time within a three year
period. Makes conforming amendments. (The introduced version of
this bill was prepared by the interim study committee on pension
management oversight.)
Effective: Upon passage; July 1, 2025.
Buchanan, Rogers
January 13, 2025, read first time and referred to Committee on Pensions and Labor.
2025 IN 250—LS 6769/DI 144 Introduced
First Regular Session of the 124th General Assembly (2025)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type. Also, the
word NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
between statutes enacted by the 2024 Regular Session of the General Assembly.
SENATE BILL No. 250
A BILL FOR AN ACT to amend the Indiana Code concerning
pensions.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 5-1-14-15, AS AMENDED BY P.L.146-2008,
2 SECTION 30, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
3 JULY 1, 2025]: Sec. 15. (a) Before July 1, 2008, a county or
4 municipality may issue bonds, notes, or other obligations for the
5 purpose of providing funds to pay pension benefits under IC 36-8-6,
6 IC 36-8-7, or IC 36-8-7.5.
7 (b) Notwithstanding any other law:
8 (1) bonds, notes, or other obligations issued for the purpose
9 described in this section may have a final maturity date up to, but
10 not exceeding, forty (40) years from the date of original issuance;
11 and
12 (2) the amount of bonds, notes, or other obligations that may be
13 issued for the purpose described in this section may not exceed
14 two percent (2%) of the true tax value of property located within
15 the county or municipality. and
16 (3) the proceeds of bonds, notes, or other obligations issued for
17 the purpose described in this section may be deposited to the
2025 IN 250—LS 6769/DI 144 2
1 issuing county's or municipality's separate account described in
2 IC 5-10.3-11-6.
3 (c) This section is supplemental to all other laws but does not
4 relieve a county or municipality from complying with other procedural
5 requirements for the issuance of bonds, notes, or other obligations.
6 SECTION 2. IC 5-10.2-4-3, AS AMENDED BY P.L.2-2007,
7 SECTION 93, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
8 JULY 1, 2025]: Sec. 3. (a) This subsection applies to a member who
9 retires before January 1, 2027. Except as provided in subsection (f),
10 (h), in computing the retirement benefit for a nonteacher member,
11 "average of the annual compensation" means the average annual
12 compensation calculated using the twenty (20) calendar quarters of
13 service in a position covered by the retirement fund before retirement
14 in which the member's annual compensation was the highest. However,
15 in order for a quarter to be included in the twenty (20) calendar
16 quarters, the nonteacher member must have performed service
17 throughout the calendar quarter. All twenty (20) calendar quarters do
18 need not have to be continuous but they must be in groups of four (4)
19 consecutive calendar quarters. The same calendar quarter may not be
20 included in two (2) different groups.
21 (b) This subsection applies to a member who retires after
22 December 31, 2026. This subsection does not apply to a teacher
23 member described in subsection (d) or (e). Except as provided in
24 subsection (h), in computing the retirement benefit for a
25 nonteacher member, "average of the annual compensation" means
26 average annual compensation calculated using the greater of the
27 following:
28 (1) The five (5) calendar years of service before retirement in
29 which the member's annual compensation for the calendar
30 year was the highest.
31 (2) The five (5) fiscal years of service before retirement in
32 which the member's annual compensation for the fiscal year
33 was the highest.
34 (c) The following apply to the calculation under subsection (b):
35 (1) A year does not qualify for inclusion in the calculation
36 unless:
37 (A) the year is equal to twelve (12) months; and
38 (B) the member received creditable service for at least six
39 (6) months throughout the year.
40 (2) A calendar year begins on January 1.
41 (3) A fiscal year begins on July 1.
42 (4) The five (5) years need not be continuous.
2025 IN 250—LS 6769/DI 144 3
1 (b) (d) This subsection does not apply to a teacher member
2 described in subsection (c). (e). In computing the retirement benefit for
3 a teacher member, "average of the annual compensation" means the
4 average annual compensation for the five (5) years of service before
5 retirement in which the member's annual compensation was highest. In
6 order for a year to be included in the five (5) years, the teacher member
7 must have received for the year credit under IC 5-10.4-4-2 for at least
8 one-half (1/2) year of service. The five (5) years do need not have to be
9 continuous.
10 (c) (e) This subsection applies to a member of the Indiana state
11 teachers' retirement fund who serves in an elected position for which
12 the member takes an unpaid leave of absence. In computing the
13 retirement benefit for a teacher member described in this subsection for
14 years of service to which IC 5-10.4-5-7 does not apply, "average of the
15 annual compensation" means the annual compensation for the one (1)
16 year of service before retirement in which the member's annual
17 compensation was highest. In order for a year to be used, the teacher
18 member must have received for the year credit under IC 5-10.4-4-2 for
19 at least one-half (1/2) year of service.
20 (d) (f) Subject to IC 5-10.2-2-1.5, "annual compensation" means:
21 (1) the basic salary earned by and paid to the member plus the
22 amount that would have been part of that salary but for:
23 (A) the state's, a school corporation's, a participating political
24 subdivision's, or a state educational institution's paying the
25 member's contribution to the fund for the member; or
26 (B) the member's salary reduction agreement established under
27 Section 125, 403(b), or 457 of the Internal Revenue Code; and
28 (2) in the case of a member described in subsection (c) (e) and for
29 years of service to which IC 5-10.4-5-7 does not apply, the basic
30 salary that was not paid during the year but would have been paid
31 to the member during the year under the member's employment
32 contracts, if the member had not taken any unpaid leave of
33 absence to serve in an elected position.
34 The portion of a back pay award or a similar award that the board
35 determines is compensation under an agreement or under a judicial or
36 an administrative proceeding shall be allocated by the board among the
37 years the member earned or should have earned the compensation.
38 Only that portion of the award allocated to the year the award is made
39 is considered to have been earned during the year the award was made.
40 Interest on an award is not considered annual compensation for any
41 year.
42 (e) (g) This subsection applies to a member who retires before
2025 IN 250—LS 6769/DI 144 4
1 January 1, 2027. Compensation of not more than two thousand dollars
2 ($2,000) received from the employer in contemplation of the member's
3 retirement, including severance pay, termination pay, retirement bonus,
4 or commutation of unused sick leave or personal leave, may be
5 included in the total annual compensation from which the average of
6 the annual compensation is determined, if it is received:
7 (1) before the member ceases service; or
8 (2) within twelve (12) months after the member ceases service.
9 (f) (h) This subsection applies to a member of the general assembly:
10 (1) who is a participant in the legislators' retirement system
11 established under IC 2-3.5;
12 (2) who is also a member of the public employees' retirement fund
13 or the Indiana state teachers' retirement fund; and
14 (3) whose years of service in the general assembly may not be
15 considered in determining the average of the annual
16 compensation under this section, as provided in
17 IC 2-3.5-1-2(b)(2) or IC 2-3.5-3-1(c).
18 The board shall use the board's actuarial salary increase assumption to
19 project the salary for any previous year needed to determine the
20 average of the annual compensation.
21 SECTION 3. IC 5-10.2-4-3.2 IS ADDED TO THE INDIANA
22 CODE AS A NEW SECTION TO READ AS FOLLOWS
23 [EFFECTIVE JULY 1, 2025]: Sec. 3.2. (a) This section applies to the
24 calculation of the average of the annual compensation under
25 section 3 of this chapter.
26 (b) For purposes of this section, "compensation received in
27 contemplation of retirement" means compensation that:
28 (1) a member received:
29 (A) during the member's last year of service; and
30 (B) after the member's last year of service; and
31 (2) is greater than one hundred twenty percent (120%) of the
32 compensation the member received during the year before the
33 member's last year of service.
34 (c) For a member who:
35 (1) retires after December 31, 2026; and
36 (2) served in a covered position during the entire year before
37 the member's last year of service;
38 compensation received in contemplation of retirement is excluded
39 from the average of the annual compensation.
40 (d) For purposes of this section, a year must begin on January
41 1 or July 1.
42 SECTION 4. IC 5-10.2-5-43, AS ADDED BY P.L.12-2008,
2025 IN 250—LS 6769/DI 144 5
1 SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
2 JULY 1, 2025]: Sec. 43. (a) The pension portion (plus postretirement
3 increases to the pension portion) provided by employer contributions
4 of the monthly benefit payable after December 31, 2008, to a member
5 of the public employees' retirement fund (or to a survivor or beneficiary
6 of a member of the public employees' retirement fund) who retired or
7 was disabled before January 1, 2008, shall be increased by:
8 (1) two percent (2%) for members who retired after December 31,
9 1999; and
10 (2) two and one-half (2.5%) percent for members who retired
11 before January 1, 2000.
12 (b) In addition to any other cost of living increase provided under
13 this chapter, the pension portion (plus postretirement increases to the
14 pension portion) provided by employer contributions of the monthly
15 benefit payable after December 31, 2008, to a member of the public
16 employees' retirement fund (or to a survivor or beneficiary of a member
17 of the public employees' retirement fund) who:
18 (1) is a retired member of the fund; with at least ten (10) years of
19 creditable service and
20 (2) has attained vested status (as defined in IC 5-10.2-1-8);
21 may not be less than one hundred eighty dollars ($180).
22 (c) Subsection (b) does not apply to a member of the public
23 employees' retirement fund (or to a survivor or beneficiary of a member
24 of the public employees' retirement fund) whose creditable service was
25 earned only as an elected official.
26 (d) (c) The increases specified in this section:
27 (1) are based on the date of the member's latest retirement or
28 disability;
29 (2) do not apply to benefits payable in a lump sum; and
30 (3) are in addition to any other increase provided by law.
31 SECTION 5. IC 5-10.3-7-1, AS AMENDED BY P.L.92-2019,
32 SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
33 JULY 1, 2025]: Sec. 1. (a) This section does not apply to:
34 (1) members of the general assembly; or
35 (2) employees covered by section 3 of this chapter.
36 (b) As used in this section, "employees of the state" includes:
37 (1) employees of the judicial circuits whose compensation is paid
38 from state funds;
39 (2) elected and appointed state officers;
40 (3) prosecuting attorneys and deputy prosecuting attorneys of the
41 judicial circuits, whose compensation is paid in whole or in part
42 from state funds, including participants in the prosecuting
2025 IN 250—LS 6769/DI 144 6
1 attorneys retirement fund established under IC 33-39-7;
2 (4) employees in the classified service;
3 (5) employees of any state department, institution, board,
4 commission, office, agency, court, or division of state government
5 receiving state appropriations and having the authority to certify
6 payrolls from appropriations or from a trust fund held by the
7 treasurer of state or by any department;
8 (6) employees of any state agency that is a body politic and
9 corporate;
10 (7) except as provided under IC 5-10.5-7-4, employees of the
11 board of trustees of the Indiana public retirement system;
12 (8) persons who:
13 (A) are employed by the state;
14 (B) have been classified as federal employees by the United
15 States Secretary of Agriculture; and
16 (C) are excluded from coverage as federal employees by the
17 federal Social Security program under 42 U.S.C. 410;
18 (9) the directors and employees of county offices of family and
19 children; and
20 (10) members and employees of the state lottery commission.
21 (c) An employee of the state or of a participating political
22 subdivision who:
23 (1) became a full-time employee of the state or of a participating
24 political subdivision in a covered position; and
25 (2) had not become a member of the fund;
26 before April 1, 1988, shall on April 1, 1988, become a member of the
27 fund unless the employee is excluded from membership under section
28 2 of this chapter.
29 (d) Except as otherwise provided, any individual who becomes a
30 full-time employee of the state or of a participating political
31 subdivision in a covered position after March 31, 1988, becomes a
32 member of the fund on the date the individual's employment begins
33 unless the individual is excluded from membership under section 2 of
34 this chapter.
35 (e) An individual:
36 (1) who becomes a full-time employee of a political subdivision
37 in a covered position after June 30, 2015;
38 (2) who is employed by a political subdivision that has elected in
39 an ordinance or resolution adopted under IC 5-10.3-6-1 and
40 approved by the board to require an employee in the covered
41 position to become a member of the fund; and
42 (3) who is not excluded from membership under section 2 of this
2025 IN 250—LS 6769/DI 144 7
1 chapter;
2 becomes a member of the fund on the date the individual's employment
3 begins.
4 (f) An individual:
5 (1) who becomes a full-time employee of a political subdivision
6 in a covered position after an ordinance or resolution described in
7 subdivision (2) that is adopted by the political subdivision has
8 been approved by the board;
9 (2) who is employed by a political subdivision that has elected in
10 an ordinance or resolution adopted under IC 5-10.3-6-1 and
11 approved by the board:
12 (A) to allow an employee in the covered position to become a
13 member of the fund or a member of the public employees'
14 defined contribution plan at the discretion of the employee;
15 and
16 (B) to require an employee in a covered position to make an
17 election under IC 5-10.3-12-20.5 in order to become a member
18 of the plan;
19 (3) who does not make an election under IC 5-10.3-12-20.5 to
20 become a member of the public employees' defined contribution
21 plan; and
22 (4) who is not excluded from membership under section 2 of this
23 chapter;
24 becomes a member of the fund on the date the individual's employment
25 begins.
26 (g) An individual:
27 (1) who becomes a full-time employee of a political subdivision
28 in a covered position after an ordinance or resolution described in
29 subdivision (2) that is adopted by the political subdivision has
30 been approved by the board;
31 (2) who is employed by a political subdivision that has elected in
32 an ordinance or resolution adopted under IC 5-10.3-6-1 and
33 approved by the board:
34 (A) to allow an employee in the covered position to become a
35 member of the fund or the public employees' defined
36 contribution plan at the discretion of the employee; and
37 (B) to require an employee to make an election under section
38 1.1 of this chapter in order to become a member of the fund;
39 (3) who does make an election under section 1.1 of this chapter to
40 become a member of the fund; and
41 (4) who is not excluded from membership under section 2 of this
42 chapter;
2025 IN 250—LS 6769/DI 144 8
1 becomes a member of the fund on the date the individual's employment
2 begins.
3 (h) An individual who makes an election to participate in the
4 fund under IC 5-10.3-12-33 becomes a member of the fund on the
5 date the board receives the election.
6 SECTION 6. IC 5-10.3-11-3, AS AMENDED BY P.L.27-2019,
7 SECTION 5, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
8 JULY 1, 2025]: Sec. 3. The pension relief fund may be used only for
9 making payments to cities, counties, towns, and townships, referred to
10 as "units of local government" in this chapter, having pension funds
11 established under IC 18-1-12, IC 19-1-18, IC 19-1-24, IC 19-1-25-4,
12 IC 19-1-30, IC 19-1-37, or IC 19-1-44 (all before their repeal), and
13 paying reasonable administrative expenses approved by the state board.
14 Payments received by the units may be used only for
15 (1) pension payments from a pension fund listed in this section.
16 or
17 (2) withdrawals under section 6 of this chapter.
18 SECTION 7. IC 5-10.3-11-6 IS REPEALED [EFFECTIVE JULY
19 1, 2025]. Sec. 6. (a) The state board shall maintain separate accounts
20 for each unit of local government for purposes of this section. The
21 accounts are separate and distinct accounts within the public
22 employees' retirement fund and the pension relief fund.
23 (b) A unit of local government may do the following:
24 (1) Make deposits at any time to the separate account established
25 for the unit under this section.
26 (2) Withdraw once each year from the unit's separate account all
27 or a part of the balance in the account to pay pension benefits
28 under IC 36-8-6, IC 36-8-7, or IC 36-8-7.5.
29 (3) Direct the state board at any time to pay from the unit's
30 separate account all or a part of either or both of the following:
31 (A) The unit's employer contributions under IC 36-8-8-6.
32 (B) The contributions paid by the unit for a member under
33 IC 36-8-8-8(a).
34 SECTION 8. IC 5-10.3-12-25, AS AMENDED BY P.L.241-2015,
35 SECTION 35, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
36 UPON PASSAGE]: Sec. 25. (a) Member contributions and net
37 earnings on the member contributions in the member contribution
38 subaccount belong to the member at all times and do not belong to any
39 employer.
40 (b) A member is vested in the employer contribution subaccount in
41 accordance with the following schedule:
42 Years of participation in the Vested percentage of
2025 IN 250—LS 6769/DI 144 9
1 plan employer contributions
2 and earnings
3 1 20%
4 2 40%
5 3 60%
6 4 80%
7 5 100%
8 For purposes of vesting in the employer contribution subaccount, only
9 a member's full years of participation in the plan may be counted.
10 (c) The amount that a member may withdraw from the member's
11 account is limited to the vested portion of the account.
12 (d) A member who attains normal retirement age is fully vested in
13 all amounts in the member's account.
14 (e) If a member separates from service with the member's employer
15 before the member is fully vested in the employer contribution
16 subaccount, the amount in the employer contribution subaccount that
17 is not vested is forfeited as of the date the member separates from
18 service.
19 (f) Amounts forfeited under subsection (e) must be used to reduce
20 the unfunded accrued liability of the fund as determined under
21 IC 5-10.2-2-11(a)(3) and IC 5-10.2-2-11(a)(4). as determined by the
22 board.
23 (g) A member may not earn creditable service (as defined in
24 IC 5-10.2-3-1(a)) under the plan.
25 SECTION 9. IC 5-10.3-12-27, AS AMENDED BY P.L.86-2018,
26 SECTION 18, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
27 JULY 1, 2025]: Sec. 27. (a) For purposes of this section, "member"
28 includes an individual who makes an election to participate in the
29 fund under section 33 of this chapter.
30 (a) (b) If a member dies:
31 (1) while in service in a position covered by the plan but not in
32 the line of duty; or
33 (2) after terminating service in a position covered by the plan but
34 before withdrawing the member's account;
35 to the extent that the member is vested, the member's account shall be
36 paid to the beneficiary or beneficiaries designated by the member on
37 a form prescribed by the board. The amount paid shall be valued as
38 provided in IC 5-10.2-2-3 and IC 5-10.2-2-4 (expired). The board shall
39 invest the total amount in the member's account in the stable value fund
40 not later than thirty (30) days after receiving notification of a member's
41 death.
42 (b) (c) If there is no properly designated beneficiary, or if no
2025 IN 250—LS 6769/DI 144 10
1 beneficiary survives the member, the member's account shall be paid
2 to:
3 (1) the surviving spouse of the member;
4 (2) if there is not a surviving spouse, the surviving dependent or
5 dependents of the member in equal shares; or
6 (3) if there is not a surviving spouse or dependent, the member's
7 estate.
8 (c) (d) The beneficiary or beneficiaries designated under subsection
9 (a) (b) or a survivor determined under subsection (b) (c) may elect to
10 have the member's account paid as:
11 (1) a lump sum;
12 (2) a direct rollover to another eligible retirement plan; or
13 (3) a monthly annuity in accordance with rules of the board.
14 A monthly annuity is an option only on or after the beneficiary or
15 survivor attains sixty-two (62) years of age. The board shall establish
16 the forms of annuity by rule, in consultation with the board's actuary.
17 Further, the board may establish a minimum account balance or a
18 minimum monthly payment amount that is required in order for a
19 beneficiary or survivor to select the monthly annuity option.
20 (d) (e) If a member dies in the line of duty while in service in a
21 covered position, the designated beneficiary or beneficiaries or the
22 surviving spouse or dependents, as applicable, are entitled to payment
23 of the member's account as provided in this section. In addition, if the
24 member was not fully vested in the employer contribution subaccount,
25 the account is deemed to be fully vested for purposes of withdrawal
26 under this section.
27 SECTION 10. IC 5-10.3-12-33 IS ADDED TO THE INDIANA
28 CODE AS A NEW SECTION TO READ AS FOLLOWS
29 [EFFECTIVE JULY 1, 2025]: Sec. 33. (a) This section applies
30 notwithstanding sections 20, 20.3, 20.5, and 31 of this chapter.
31 (b) An employer that participates in the fund may allow a
32 member who is fully vested in the employer contribution
33 subaccount under section 25(b) of this chapter to make an election
34 to participate in the fund.
35 (c) The following apply to an election made under subsection
36 (b):
37 (1) The election must be made:
38 (A) within a time; and
39 (B) in a form and manner;
40 approved by the board.
41 (2) An employee who makes an election:
42 (A) becomes a member of the fund; and
2025 IN 250—LS 6769/DI 144 11
1 (B) is no longer a member of the plan;
2 on the date described in IC 5-10.3-7-1(h).
3 (3) The election is irrevocable.
4 (d) A member who does not make an election under subsection
5 (b) remains a member of the plan. The failure to make an election
6 under subsection (b) is irrevocable.
7 SECTION 11. IC 5-10.4-4-1, AS AMENDED BY P.L.104-2022,
8 SECTION 16, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
9 JULY 1, 2025]: Sec. 1. (a) The members of the fund include:
10 (1) legally qualified and regularly employed teachers in the public
11 schools;
12 (2) persons employed by a governing body, who were qualified
13 before their election or appointment;
14 (3) legally qualified and regularly employed teachers at Ball State
15 University, Indiana State University, University of Southern
16 Indiana, and Vincennes University;
17 (4) legally qualified and regularly employed teachers in a state
18 educational institution whose teachers devote their entire time to
19 teaching;
20 (5) legally qualified and regularly employed teachers in state
21 benevolent, charitable, or correctional institutions;
22 (6) legally qualified and regularly employed teachers in an
23 experimental school in a state university who teach elementary or
24 high school students;
25 (7) as determined by the board, certain instructors serving in a
26 state educational institution extension division not covered by a
27 state retirement law;
28 (8) employees and officers of the department of education and of
29 the fund who were qualified before their election or appointment;
30 (9) a person who:
31 (A) is employed as a nurse appointed under IC 20-34-3-6 by a
32 school corporation located in a city having a population of more
33 than sixty-nine thousand (69,000) and less than sixty-nine
34 thousand five hundred (69,500); and
35 (B) participated in the fund before December 31, 1991, in the
36 position described in clause (A); and
37 (10) persons who are employed by the fund.
38 (b) Teachers in any state institution who accept the benefits of a
39 state supported retirement benefit system comparable to the fund's
40 benefits may not come under the fund unless permitted by law or the
41 rules of the board.
42 (c) The members of the fund do not include substitute teachers who
2025 IN 250—LS 6769/DI 144 12
1 have not obtained an associate degree or a baccalaureate degree.
2 (d) Except as provided in IC 5-10.4-8-18, the members of the fund
3 do not include individuals who participate in the teachers' defined
4 contribution plan under IC 5-10.4-8.
5 (e) An individual who makes an election to participate in the
6 fund under IC 5-10.4-8-18 becomes a member of the fund on the
7 date the board receives the election.
8 SECTION 12. IC 5-10.4-8-13, AS ADDED BY P.L.217-2017,
9 SECTION 58, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
10 JULY 1, 2025]: Sec. 13. (a) For purposes of this section, "member"
11 includes an individual who makes an election to participate in the
12 fund under section 18 of this chapter.
13 (a) (b) If a member dies:
14 (1) while in service in a position covered by the plan; or
15 (2) after terminating service in a position covered by the plan but
16 before withdrawing the member's account;
17 to the extent that the member is vested, the member's account shall be
18 paid to the beneficiary or beneficiaries designated by the member on
19 a form prescribed by the board. The amount paid must be valued as
20 provided in IC 5-10.2-2-3. The board shall invest the total amount in
21 the member's account in the stable value fund not later than thirty (30)
22 days after receiving notification of a member's death.
23 (b) (c) If there is no properly designated beneficiary, or if no
24 beneficiary survives the member, the member's account shall be paid
25 to:
26 (1) the surviving spouse of the member;
27 (2) if there is not a surviving spouse, the surviving dependent or
28 dependents of the member in equal shares; or
29 (3) if there is not a surviving spouse or dependent, the member's
30 estate.
31 (c) (d) The beneficiary or beneficiaries designated under subsection
32 (a) (b) or a survivor determined under subsection (b) (c) may elect to
33 have the member's account paid as:
34 (1) a lump sum;
35 (2) a direct rollover to another eligible retirement plan; or
36 (3) a monthly annuity in accordance with rules of the board.
37 A monthly annuity is an option only on or after the date the beneficiary
38 or survivor becomes sixty-two (62) years of age. The board shall
39 establish the forms of annuity by rule, in consultation with the board's
40 actuary. Further, The board may establish a minimum account balance
41 or a minimum monthly payment amount that is required in order for a
42 beneficiary or survivor to select the monthly annuity option.
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1 SECTION 13. IC 5-10.4-8-18 IS ADDED TO THE INDIANA
2 CODE AS A NEW SECTION TO READ AS FOLLOWS
3 [EFFECTIVE JULY 1, 2025]: Sec. 18. (a) This section applies
4 notwithstanding sections 6 and 17 of this chapter.
5 (b) A member who is fully vested in the employer contribution
6 subaccount under section 11 of this chapter may make an election
7 to participate in the fund.
8 (c) The following apply to an election made under subsection
9 (b):
10 (1) The election must be made:
11 (A) within a time; and
12 (B) in a form and manner;
13 approved by the board.
14 (2) An employee who makes an election under subsection (b):
15 (A) becomes a member of the fund; and
16 (B) is no longer a member of the plan;
17 on the date described in IC 5-10.4-4-1(e).
18 (3) The election is irrevocable.
19 (d) A member who does not make an election under subsection
20 (b) remains a member of the plan. The failure to make an election
21 under subsection (b) is irrevocable.
22 SECTION 14. IC 5-11-20-6, AS ADDED BY P.L.129-2024,
23 SECTION 8 AND P.L.136-2024, SECTION 5, IS AMENDED TO
24 READ AS FOLLOWS [EFFECTIVE JULY 1, 2025]: Sec. 6. (a) On or
25 before June 15 of each year, the system shall send a delinquency notice
26 to a delinquent political subdivision. The delinquency notice must
27 inform the delinquent political subdivision that: of the following:
28 (1) An employee retirement plan offered by the delinquent
29 political subdivision:
30 (A) received less than ninety-five percent (95%) of the
31 actuarially determined contribution for at least three (3) out of
32 the last five (5) immediately preceding fiscal year, years, as
33 determined by the system or its agent; or
34 (B) was less than fifty percent (50%) funded at any time during
35 the immediately preceding fiscal year, as determined by the
36 system or its agent. and
37 (2) That the delinquent political subdivision must take the steps
38 described in comply with subsection (b).
39 (b) After receiving the notice described in subsection (a), a political
40 subdivision shall make a presentation that includes a remediation plan
41 to the interim study committee on pension management oversight
42 (established by IC 2-5-1.3-4) regarding the delinquent employee
2025 IN 250—LS 6769/DI 144 14
1 retirement plan described in subsection (a). However, a delinquent
2 political subdivision may not be required to make a presentation
3 under this subsection more than one (1) time within a three (3)
4 year period.
5 SECTION 15. An emergency is declared for this act.
2025 IN 250—LS 6769/DI 144