SB2591 Summary

• Creates a new "Tier 3" benefit package for State Universities Retirement System (SURS) participants hired on or after July 1, 2015, combining a defined benefit component (1.5% of earnings per year of service) with a defined contribution component funded by employee and employer contributions.

• Modifies the "Tier 1" participant (those hired before January 1, 2011) contributions by requiring an additional contribution starting at 0.5% of earnings on July 1, 2013, increasing by 0.5% annually until reaching 2.0%, with automatic annual retirement increases reduced to one-half the consumer price index-u (versus 3% previously).

• Allows eligible participants hired between January 1, 2011 and July 1, 2015 to irrevocably elect to become Tier 3 participants by January 1, 2015, with Tier 3 participants excluded from the portable benefit package and self-managed plan.

• Changes the effective interest rate formula for fiscal years beginning July 1, 2013 to equal the 30-year U.S. Treasury bond rate plus 75 basis points, and adds 2 additional gubernatorial Board of Trustees appointments plus converts 2 elected active participant positions to gubernatorial appointments beginning in 2015.

• Specifies that no State reimbursement is required for implementing mandates created by this Act and includes a severability provision; takes effect immediately upon becoming law.