SENATE BUDGET AND APPROPRIATIONS COMMITTEE
STATEMENT TO
[First Reprint]
ASSEMBLY, No. 1675
with committee amendments
STATE OF NEW JERSEY
DATED: MARCH 17, 2025
The Senate Budget and Appropriations Committee reports
favorably and with committee amendments Assembly Bill No. 1675
(1R).
As amended, this bill extends the length of time a member of the
Teachers’ Pension and Annuity Fund (TPAF) can maintain their
membership and member tier in the TPAF following a period of
discontinuance, both prior to and following the effective date of the
bill. Under current law, membership in the TPAF ceases if an
individual discontinues service for more than two years. This bill
extends the period of discontinuance to 10 years.
The bill also extends the length of time a member who left service
for certain qualifying reasons may return to service and includes
among the qualifying reasons those who voluntarily left service with
10 or more years of service credit. Under current law, membership in
the TPAF may continue if the member returns to service within a
period of 10 years from the date of discontinuance from service. This
bill extends the period of discontinuance to 15 years so long as the
teacher has not withdrawn their accumulated member's contributions
from the retirement system, provided that the administration of this
provision is consistent with IRS rules governing minimum required
distributions from a qualified retirement plan.
Under the bill, a person who returns to service with an employer
within the time period of 10 or 15 years will be eligible for enrollment
in the fund based on the eligibility requirements for enrollment for the
member’s tier at the time of the member’s termination of service prior
to the return.
The bill is retroactive and requires that a person who returned to
service with an employer prior to the effective date of the bill within
the time period of 10 or 15 years will be enrolled in the fund and will
be placed in the member’s tier at the time of the member’s termination
of service prior to the return. There will be no additional contributions
imposed on the member or the member’s employer.
This bill requires the Division of Pensions and Benefits to make
such adjustments and transfers as will be necessary to ensure the 2
enrollment of the member in the fund and placement in the same tier
pursuant to this bill.
As amended and reported by the committee, Assembly Bill No.
1675 (1R) is identical to Senate Bill No. 2078 (1R), which was also
amended and reported by the committee on this date.
COMMITTEE AMENDMENTS :
The committee amended the bill to clarify that members who left
service for certain qualifying reasons and are returning to service after
15 years may do so provided that the administration of this provision is
consistent with IRS rules governing minimum required distributions
from a qualified retirement plan.
FISCAL IMPACT:
Fiscal information for this bill is currently unavailable.