EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*sb0481*
SENATE BILL 481
P6 3lr1356
CF HB 424
By: Senator Lewis Young Senators Lewis Young and Benson
Introduced and read first time: February 3, 2023
Assigned to: Budget and Taxation
Committee Report: Favorable with amendments
Senate action: Adopted
Read second time: March 3, 2023
CHAPTER ______
AN ACT concerning 1
State Retirement and Pension System – Nonvested Accounts – Regular Interest 2
FOR the purpose of requiring a certain rate of interest on certain member contributions in 3
an active member’s nonvested account in the State Retirement and Pension System 4
if the member has not withdrawn contributions from the nonvested account and is 5
not eligible to receive a certain vested allowance; providing for the retroactive 6
application of this Act; and generally relating to the accrual of interest on member 7
contributions in the State Retirement and Pension System. 8
BY repealing and reenacting, with amendments, 9
Article – State Personnel and Pensions 10
Section 22–215, 23–213, 24–206, 25–204, 26–205, and 27–203 11
Annotated Code of Maryland 12
(2015 Replacement Volume and 2022 Supplement) 13
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 14
That the Laws of Maryland read as follows: 15
Article – State Personnel and Pensions 16
22–215. 17
(a) Except as provided in subsection (b) of this section, regular interest is payable 18
on member contributions at the rate of 4% a year compounded annually, until retirement 19
or withdrawal of the accumulated contributions. 20 2 SENATE BILL 481
(b) [No] EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION , NO 1
further interest shall be paid on member contributions after membership ends if the former 2
member is not eligible to receive a vested allowance under Title 29, Subtitle 3 of this article. 3
(C) (1) IN THIS SUBSECTION , “ACTIVE MEMBER ” MEANS A MEMBER WHO 4
IS NOT SEPARATED FRO M EMPLOYMENT WITH TH E STATE OR A PARTICIPAT ING 5
EMPLOYER OF ONE OF T HE SEVERAL SYSTEMS . 6
(2) THIS SUBSECTION AP PLIES ONLY TO AN IND IVIDUAL WHO: 7
(I) IS A FORMER MEMBER O F THE EMPLOYEES’ RETIREMENT 8
SYSTEM OR THE TEACHERS’ RETIREMENT SYSTEM; 9
(II) IS NOT ELIGIBLE TO R ECEIVE A VESTED ALLO WANCE FROM 10
THE EMPLOYEES’ RETIREMENT SYSTEM OR THE TEACHERS’ RETIREMENT SYSTEM 11
UNDER TITLE 29, SUBTITLE 3 OF THIS ARTICLE; 12
(III) HAS NOT WITHDRAWN TH E INDIVIDUAL ’S MEMBER 13
CONTRIBUTIONS FROM T HE EMPLOYEES’ RETIREMENT SYSTEM OR THE TEACHERS’ 14
RETIREMENT SYSTEM; AND 15
(IV) IS AN ACTIVE MEMBER OF ONE OF THE SEVERA L SYSTEMS. 16
(3) AN INDIVIDUAL DESCRIB ED IN PARAGRAPH (2) OF THIS 17
SUBSECTION SHALL REC EIVE REGULAR INTERES T AT THE RATE DESCRI BED UNDER 18
SUBSECTION (A) OF THIS SECTION ON T HE INDIVIDUAL’S MEMBER CONTRIBUTIO NS 19
IN A NONVESTED ACCOU NT IN THE EMPLOYEES’ RETIREMENT SYSTEM OR THE 20
TEACHERS’ RETIREMENT SYSTEM WHILE THE INDIVIDUAL IS AN ACTIVE MEMBER 21
OF ONE OF THE SEVERA L SYSTEMS. 22
23–213. 23
(a) Except as provided in subsection (b) of this section, regular interest is payable 24
on member contributions at the rate of 5% per year compounded annually until retirement 25
or withdrawal of contributions and interest. 26
(b) Except as provided in [subsection (c)] SUBSECTIONS (C) AND (D) of this 27
section, no further interest shall be paid on member contributions after membership ends 28
if the former member is not eligible to receive a vested allowance under Title 29, Subtitle 3 29
of this article. 30
(c) (1) In this subsection, “active member” means a member who is not 31
separated from employment with the State or a participating employer of the Employees’ 32
Pension System or the Teachers’ Pension System ONE OF THE SEVERAL S YSTEMS. 33 SENATE BILL 481 3
(2) This subsection applies only to an individual who: 1
(i) is a former member of the Alternate Contributory Pension 2
Selection EMPLOYEES’ PENSION SYSTEM OR THE TEACHERS’ PENSION SYSTEM; 3
(ii) is not eligible to receive a vested allowance from the Alternate 4
Contributory Pension Selection EMPLOYEES’ PENSION SYSTEM OR THE TEACHERS’ 5
PENSION SYSTEM under Title 29, Subtitle 3 of this article; 6
(iii) has not withdrawn the individual’s member contributions from 7
the Alternate Contributory Pension Selection EMPLOYEES’ PENSION SYSTEM OR THE 8
TEACHERS’ PENSION SYSTEM; and 9
(iv) is an active member subject to the Reformed Contributory 10
Pension Benefit OF ONE OF THE SEVERA L SYSTEMS. 11
(3) An individual described in paragraph (2) of this subsection shall receive 12
regular interest at the rate described under subsection (a) of this section on the individual’s 13
member contributions in the Alternate Contributory Pension Selection A NONVESTED 14
ACCOUNT IN THE EMPLOYEES’ PENSION SYSTEM OR THE TEACHERS’ PENSION 15
SYSTEM while the individual is an active member subject to the Reformed Contributory 16
Pension Benefit OF ONE OF THE SEVERA L SYSTEMS. 17
(D) (1) IN THIS SUBSECTION , “ACTIVE MEMBER ” MEANS A MEMBER WHO 18
IS NOT SEPARATED FRO M EMPLOYMENT WITH TH E STATE OR A PARTICIPAT ING 19
EMPLOYER OF ONE OF T HE SEVERAL SYSTEMS . 20
(2) THIS SUBSECTION APPLI ES ONLY TO AN INDIVI DUAL WHO: 21
(I) IS A FORMER MEMBER O F THE EMPLOYEES’ PENSION 22
SYSTEM; 23
(II) IS NOT ELIGIBLE TO RECEIVE A VESTED ALLOWANCE F ROM 24
THE EMPLOYEES’ PENSION SYSTEM UNDER TITLE 29, SUBTITLE 3 OF THIS ARTICLE; 25
(III) HAS NOT WITHDRAWN TH E INDIVIDUAL ’S MEMBER 26
CONTRIBUTIONS FROM T HE EMPLOYEES’ PENSION SYSTEM; AND 27
(IV) IS AN ACTIVE MEMBER OF ONE OF THE SEVERAL S YSTEMS. 28
(3) AN INDIVIDUAL DESCRIB ED IN PARAGRAPH (2) OF THIS 29
SUBSECTION SHALL REC EIVE REGULAR INTERES T AT THE RATE DESCRI BED UNDER 30
SUBSECTION (A) OF THIS SECTION ON T HE INDIVIDUAL’S MEMBER CONTRIBUTIO NS 31 4 SENATE BILL 481
IN A NONVESTED ACCOU NT IN THE EMPLOYEES’ PENSION SYSTEM WHILE THE 1
INDIVIDUAL IS AN ACT IVE MEMBER OF ONE OF THE SEVERAL SYSTEMS . 2
24–206. 3
(a) Except as provided in subsection (b) of this section, regular interest is payable 4
on member contributions at the rate of 4% a year, compounded annually, until retirement 5
or withdrawal of the accumulated contributions. 6
(b) [No] EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION , NO 7
further interest shall be paid on member contributions after membership ends if the former 8
member is not eligible to receive a vested allowance under Title 29, Subtitle 3 of this article. 9
(C) (1) IN THIS SUBSECTION , “ACTIVE MEMBER ” MEANS A MEMBER WHO 10
IS NOT SEPARATED FROM E MPLOYMENT WITH THE STATE OR A PARTICIPAT ING 11
EMPLOYER OF ONE OF T HE SEVERAL SYSTEMS . 12
(2) THIS SUBSECTION APPLI ES ONLY TO AN INDIVI DUAL WHO: 13
(I) IS A FORMER MEMBER O F THE STATE POLICE RETIREMENT 14
SYSTEM; 15
(II) IS NOT ELIGIBLE TO RECEIVE A VESTED ALL OWANCE FROM 16
THE STATE POLICE RETIREMENT SYSTEM UNDER TITLE 29, SUBTITLE 3 OF THIS 17
ARTICLE; 18
(III) HAS NOT WITHDRAWN TH E INDIVIDUAL ’S MEMBER 19
CONTRIBUTIONS FROM T HE STATE POLICE RETIREMENT SYSTEM; AND 20
(IV) IS AN ACTIVE MEMBER OF ONE OF THE SEVERAL SY STEMS. 21
(3) AN INDIVIDUAL DESCRIB ED IN PARAGRAPH (2) OF THIS 22
SUBSECTION SHALL REC EIVE REGULAR INTERES T AT THE RATE DESCRI BED UNDER 23
SUBSECTION (A) OF THIS SECTION ON T HE INDIVIDUAL’S MEMBER CONTRIBUTIO NS 24
IN A NONVESTED ACCOU NT IN THE STATE POLICE RETIREMENT SYSTEM WHILE THE 25
INDIVIDUAL IS AN ACT IVE MEMBER OF ONE OF THE SEVERAL SYSTEMS . 26
25–204. 27
(a) Except as provided in subsection (b) of this section, regular interest is payable 28
on member contributions at the rate of 4% a year, compounded annually, until retirement 29
or withdrawal of the accumulated contributions. 30
SENATE BILL 481 5
(b) [No] EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION , NO 1
further interest shall be paid on member contributions after membership ends if the former 2
member is not eligible to receive a vested allowance under Title 29, Subtitle 3 of this article. 3
(C) (1) IN THIS SUBSECTION , “ACTIVE MEMBER ” MEANS A MEMBER WHO 4
IS NOT SEPARATED FRO M EMPLOYMENT WITH TH E STATE OR A PARTICIPAT ING 5
EMPLOYER OF ONE OF T HE SEVERAL SYSTEMS . 6
(2) THIS SUBSECTION APPLI ES ONLY TO AN INDIVI DUAL WHO: 7
(I) IS A FORMER MEMBER O F THE CORRECTIONAL OFFICERS’ 8
RETIREMENT SYSTEM; 9
(II) IS NOT ELIGIBLE TO R ECEIVE A VESTED ALLO WANCE FROM 10
THE CORRECTIONAL OFFICERS’ RETIREMENT SYSTEM UNDER TITLE 29, SUBTITLE 11
3 OF THIS ARTICLE; 12
(III) HAS NOT WITHDRAWN TH E INDIVIDUAL ’S MEMBER 13
CONTRIBUTIONS FROM T HE CORRECTIONAL OFFICERS’ RETIREMENT SYSTEM; AND 14
(IV) IS AN ACTIVE MEMBER OF ONE OF THE SEVERA L SYSTEMS. 15
(3) AN INDIVIDUAL DESCRIB ED IN PARAGRAPH (2) OF THIS 16
SUBSECTION SHALL REC EIVE REGULAR INTERES T AT THE RATE DESCRI BED UNDER 17
SUBSECTION (A) OF THIS SECTION ON T HE INDIVIDUAL’S MEMBER CONTRIBUTIO NS 18
IN A NONVESTED ACCOU NT IN THE CORRECTIONAL OFFICERS’ RETIREMENT 19
SYSTEM WHILE THE INDI VIDUAL IS AN ACTIVE MEMBER OF ONE OF THE SEV ERAL 20
SYSTEMS. 21
26–205. 22
(a) Except as provided in subsection (b) of this section, regular interest is payable 23
on member contributions until retirement or withdrawal of accumulated contributions at 24
the rate of: 25
(1) 4% a year, compounded annually, for a member who has transferred 26
from the Employees’ Retirement System on or before December 31, 2004; or 27
(2) 5% a year, compounded annually, for each other member. 28
(b) [No] EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION , NO 29
further interest shall be paid on member contributions after membership ends if the former 30
member is not eligible to receive a vested allowance under Title 29, Subtitle 3 of this article. 31
6 SENATE BILL 481
(C) (1) IN THIS SUBSECTION , “ACTIVE MEMBER ” MEANS A MEMBER WHO 1
IS NOT SEPARATED FROM EMPLOYM ENT WITH THE STATE OR A PARTICIPAT ING 2
EMPLOYER OF ONE OF T HE SEVERAL SYSTEMS . 3
(2) THIS SUBSECTION APPLI ES ONLY TO AN INDIVI DUAL WHO: 4
(I) IS A FORMER MEMBER O F THE LAW ENFORCEMENT 5
OFFICERS’ PENSION SYSTEM; 6
(II) IS NOT ELIGIBLE TO RECEIVE A VESTED ALLOWANCE FROM 7
THE LAW ENFORCEMENT OFFICERS’ PENSION SYSTEM UNDER TITLE 29, SUBTITLE 8
3 OF THIS ARTICLE; 9
(III) HAS NOT WITHDRAWN TH E INDIVIDUAL ’S MEMBER 10
CONTRIBUTIONS FROM T HE LAW ENFORCEMENT OFFICERS’ PENSION SYSTEM; AND 11
(IV) IS AN ACTIVE MEMBER O F ONE OF THE SEVERAL SYSTEMS. 12
(3) AN INDIVIDUAL DESCRIB ED IN PARAGRAPH (2) OF THIS 13
SUBSECTION SHALL REC EIVE REGULAR INTERES T AT THE RATE DESCRI BED UNDER 14
SUBSECTION (A) OF THIS SECTION ON T HE INDIVIDUAL’S MEMBER CONTRIBUTIO NS 15
IN A NONVESTED ACCOUNT IN TH E LAW ENFORCEMENT OFFICERS’ PENSION 16
SYSTEM WHILE THE INDI VIDUAL IS AN ACTIVE MEMBER OF ONE OF THE SEVERAL 17
SYSTEMS. 18
27–203. 19
(a) Except as provided in subsection (b) of this section, regular interest is payable 20
on member contributions at the rate of 4% a year compounded annually, until retirement 21
or withdrawal of the accumulated contributions. 22
(b) (1) This subsection applies only to an individual who becomes a member of 23
the Judges’ Retirement System on or after July 1, 2012. 24
(2) [No] EXCEPT AS PROVIDED IN SUBSECTION (C) OF THIS SECTION, 25
NO further interest shall be paid on member contributions after membership ends if the 26
former member is not eligible to receive a vested allowance under Title 29, Subtitle 3 of this 27
article. 28
(C) (1) IN THIS SUBSECTION , “ACTIVE MEMBER ” MEANS A MEMBER WHO 29
IS NOT SEPARATED FRO M EMPLOYMENT WITH TH E STATE OR A PARTICIPAT ING 30
EMPLOYER OF ONE OF T HE SEVERAL SYSTEMS . 31
(2) THIS SUBSECTION APPLI ES ONLY TO AN INDIVI DUAL WHO: 32
SENATE BILL 481 7
(I) IS A FORMER MEMBER O F THE JUDGES’ RETIREMENT 1
SYSTEM; 2
(II) IS NOT ELIGIBLE TO R ECEIVE A VESTED ALLO WANCE FROM 3
THE JUDGES’ RETIREMENT SYSTEM UNDER TITLE 29, SUBTITLE 3 OF THIS 4
ARTICLE; 5
(III) HAS NOT WITHDRAWN TH E INDIVIDUAL ’S MEMBER 6
CONTRIBUTIONS FROM T HE JUDGES’ RETIREMENT SYSTEM; AND 7
(IV) IS AN ACTIVE MEMBER OF ONE OF THE SEVERA L SYSTEMS. 8
(3) AN INDIVIDUAL DESCRIB ED IN PARAGRAPH (2) OF THIS 9
SUBSECTION SHALL REC EIVE REGULAR INTERES T AT THE RATE DESCRI BED UNDER 10
SUBSECTION (A) OF THIS SECTION ON T HE INDIVIDUAL’S MEMBER CONTRIBUTIONS 11
IN A NONVESTED ACCOU NT IN THE JUDGES’ RETIREMENT SYSTEM WHILE THE 12
INDIVIDUAL IS AN ACT IVE MEMBER OF ONE OF THE SEVERAL SYSTEMS . 13
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall be construed to 14
apply retroactively and shall be applied to and interpreted to provide payment of interest 15
on an individual’s contributions as a former member in one of the several systems of the 16
State Retirement and Pension System beginning on the date the individual became a 17
member of one of the several systems if the individual is an active member of one of the 18
several systems on the effective date of this Act. 19
SECTION 2. 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 20
July 1, 2023. 21
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
President of the Senate.
________________________________________________________________________________
Speaker of the House of Delegates.