HB 1038 Summary

• Increases employee contribution rates for members hired after June 30, 2012: Class A and B members contribute 9.8% (up from 7.8%), while firefighters, police officers, and corrections officers contribute 14.2% (up from 12.2%)

• Raises retirement eligibility requirements for new members after June 30, 2012: requires age 60 with 10 years service or age 55 with 25 years service (compared to age 55 with 5 years service for existing members)

• Reduces retirement benefit accrual rates for new members: 1.75% per year for regular service and 2.25% for special duty personnel, down from 2% and 2.5% respectively for existing members

• Reduces regular interest credit from 4.5% to 2% annually for members hired after June 30, 2011, with a board study due by 2021 to evaluate the rate

• Modifies employer contribution rates, increasing from 15% to 25% for police/firefighters and 13.75% to 17% for other employees by fiscal year 2015-2016