New Mexico 2023 Regular Session

New Mexico House Bill HB210 Compare Versions

Only one version of the bill is available at this time.

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28	28	HOUSE BILL 210
29	29	56
30	30	TH LEGISLATURE
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33	33	STATE
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35	35	OF
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37	37	NEW
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39	39	MEXICO
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42	42	FIRST SESSION
43	43	,
44	44
45	45	2023
46	46	INTRODUCED BY
47	47	Patricia A. Lundstrom and Patricia Roybal Caballero and
48	48	Christine Chandler and Roberto "Bobby" J. Gonzales
49	49	AN ACT
50	50	RELATING TO PUBLIC EMPLOYEE PENSIONS; PROVIDING A TEMPORARY,
51	51	ADDITIONAL, NON-COMPOUNDING PAYMENT TO CERTAIN RETIRED MEMBERS
52	52	UNDER THE PUBLIC EMPLOYEES RETIREMENT ACT.
53	53	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
54	54	SECTION 1. Section 10-11-118 NMSA 1978 (being Laws 2020,
55	55	Chapter 11, Section 61) is amended to read:
56	56	"10-11-118. COST-OF-LIVING ADJUSTMENTS--QUALIFIED PENSION
57	57	RECIPIENT--DECLINING INCREASE.--
58	58	A. As used in this section:
59	59	(1) "cost-of-living adjustment hurdle rate"
60	60	means the investment rate of return required to fund a cost-of-
61	61	living adjustment in excess of one-half percent, as determined
62	62	by the association's actuaries;
63	63	(2) "funded ratio" means the ratio of the
64	64	.223867.1 underscored material = new
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91	91	actuarial value of the assets of the fund to the actuarial
92	92	accrued liability of the association for payments from the
93	93	fund, as determined by the association's actuaries;
94	94	(3) "preceding calendar year" means the full
95	95	calendar year preceding the July 1 on which pensions are being
96	96	adjusted; and
97	97	(4) "smoothed investment rate of return" means
98	98	a calculation made by spreading the difference between the
99	99	expected actuarial value in investment income and the actual
100	100	market value investment income over a smoothing period, as
101	101	determined by the association's actuaries.
102	102	B. A qualified pension recipient is eligible for a
103	103	cost-of-living pension adjustment. A qualified pension
104	104	recipient is:
105	105	(1) a normal retired member who has been
106	106	retired for at least two full calendar years from the effective
107	107	date of the latest retirement prior to July 1 of the year in
108	108	which the pension is being adjusted;
109	109	(2) a normal retired member who has attained
110	110	the age of sixty-five years and has been retired for at least
111	111	one full calendar year from the effective date of the member's
112	112	latest retirement prior to July 1 of the year in which the
113	113	pension is being adjusted;
114	114	(3) a disability retired member who has been
115	115	retired for at least one full calendar year from the effective
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144	144	date of the latest retirement prior to July 1 of the year in
145	145	which the pension is being adjusted;
146	146	(4) a survivor beneficiary who has received a
147	147	survivor pension for at least two full calendar years; or
148	148	(5) a survivor beneficiary of a deceased
149	149	retired member who otherwise would have been retired at least
150	150	two full calendar years from the effective date of the latest
151	151	retirement prior to July 1 of the year in which the pension is
152	152	being adjusted.
153	153	C. [Except as provided in Subsections F, G and H of
154	154	this section] During fiscal years [2021, 2022 and 2023 ] 2024,
155	155	2025, 2026, 2027 and 2028 , a qualified pension recipient who
156	156	has attained the age of sixty-five shall receive an annual,
157	157	non-compounding, additional payment. The amount of the payment
158	158	shall be determined each fiscal year by multiplying the amount
159	159	of annual pension payments, inclusive of all cost-of-living
160	160	adjustments prior to that fiscal year [2021], by two percent.
161	161	D. Beginning May 1, 2023 and no later than each May
162	162	1 thereafter, the retirement board shall certify to the
163	163	association the:
164	164	(1) funded ratio as of June 30 of the
165	165	preceding calendar year; and
166	166	(2) smoothed investment rate of return as of
167	167	June 30 of the preceding calendar year.
168	168	E. Except as provided in Subsections F, G and H of
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197	197	this section, beginning July 1, 2023 and each July 1
198	198	thereafter, immediately following the retirement board's
199	199	certification of the funded ratio and smoothed investment rate
200	200	of return, the cost-of-living adjustment to a qualified pension
201	201	recipient payable pursuant to the Public Employees Retirement
202	202	Act shall be determined as an amount equal to the smoothed
203	203	investment rate of return on the actuarial value of assets on
204	204	June 30 of the preceding calendar year less the cost-of-living
205	205	adjustment hurdle rate, as determined by the association's
206	206	actuaries, multiplied by the funded ratio on June 30 of the
207	207	preceding calendar year or five-tenths percent, whichever is
208	208	greater, and subject to the following conditions:
209	209	(1) if the funded ratio of the fund is less
210	210	than one hundred percent on June 30 of the preceding calendar
211	211	year, the amount of the adjustment made pursuant to this
212	212	subsection shall not exceed three percent;
213	213	(2) if the funded ratio of the fund is equal
214	214	to or greater than one hundred percent on June 30 of the
215	215	preceding calendar year, the adjustment made pursuant to this
216	216	subsection shall not exceed five percent;
217	217	(3) notwithstanding the provisions of this
218	218	subsection, a qualified pension recipient shall receive a
219	219	minimum annual cost-of-living adjustment of five-tenths
220	220	percent; and
221	221	(4) the amount of increase shall be determined
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250	250	by multiplying the amount of pension, inclusive of all prior
251	251	adjustments, by the cost-of-living adjustment as determined by
252	252	this subsection.
253	253	F. For a normal retired member who worked for at
254	254	least twenty-five years under one or more applicable coverage
255	255	plans and whose annual pension benefit, after all previous
256	256	annual cost-of-living adjustments, is equal to an amount not
257	257	greater than twenty-five thousand dollars ($25,000), the
258	258	pension benefit shall be increased by two and one-half percent
259	259	each July 1. The amount of the increase shall be determined by
260	260	multiplying the amount of pension, inclusive of all prior
261	261	adjustments, by two and one-half percent.
262	262	G. For a disability retired member whose annual
263	263	pension benefit, after all previous annual cost-of-living
264	264	adjustments, is equal to an amount not greater than twenty-five
265	265	thousand dollars ($25,000), the pension benefit shall be
266	266	increased by two and one-half percent each July 1. The amount
267	267	of the increase shall be determined by multiplying the amount
268	268	of pension, inclusive of all prior adjustments, by two and one-
269	269	half percent.
270	270	H. For a normal retired member who has attained the
271	271	age of seventy-five years prior to July 1, 2020, the pension
272	272	benefit shall be increased by two and one-half percent each
273	273	July 1. The amount of the increase shall be determined by
274	274	multiplying the amount of pension, inclusive of all prior
275	275	.223867.1
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303	303	adjustments, by two and one-half percent.
304	304	I. A qualified pension recipient may decline an
305	305	increase in a pension by giving the association written notice
306	306	of the decision to decline the increase at least thirty days
307	307	prior to the date the increase would take effect."
308	308	SECTION 2. EFFECTIVE DATE.--The effective date of the
309	309	provisions of this act is July 1, 2023.
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