HB 4647 Summary

• Creates a two-tier retirement system for public school employees, with Tier 1 (defined benefit) for existing members and Tier 2 (defined contribution) for new hires after February 1, 2018.

• Tier 2 qualified participants must contribute 6% of compensation to individual accounts, with employers contributing 3% (starting February 1, 2018), and participants direct their own investments among available options.

• Closes service credit purchase opportunities after September 29, 2017 at 5 p.m., including for sabbaticals, parental leave, out-of-system service, and state service.

• Establishes separate contribution rates and 10-year amortization schedules for different cohorts of members, with normal cost contribution rates subject to minimum thresholds and unfunded liability caps varying by employer type.

• Requires experience investigation studies every 5 years and automatic adjustments to retirement age for Tier 2 members based on mortality changes, with provisions protecting members within 5 years of retirement age.