hb 0671

CHAPTER 311

HB 671-FN-A - FINAL VERSION

AN ACT establishing a contributory defined benefit judicial retirement plan.

SPONSORS: Rep. R. Wheeler, Hills 48; Rep. Stone, Rock 73; Rep. O'Neil, Rock 85; Sen. Gatsas, Dist 16; Sen. Green, Dist 6; Sen. Clegg, Dist 14

This bill establishes a contributory defined benefit judicial retirement plan and repeals statutory provisions currently determining retirement salaries and benefits of supreme court, superior court, district court, and probate court judges.

The bill increases the salaries of judges upon the effective date of the contributory judicial retirement plan.

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

AN ACT establishing a contributory defined benefit judicial retirement plan.

Be it Enacted by the Senate and House of Representatives in General Court convened:

311:1 New Chapter; Judicial Retirement Plan. Amend RSA by inserting after chapter 100-B the following new chapter:

100-C:1 Definitions. The following words and phrases as used in this chapter, unless a different meaning is plainly required by the context, shall have the following meanings:

I. "Accumulated contributions" means the sum of all the amounts deducted from the compensation of a member.

II. "Actuarial equivalent" means a benefit of equal value when computed at regular interest upon the basis of the mortality tables last adopted by the board of trustees.

(b) An individual who has demonstrated to the satisfaction of the board of trustees that such individual has the educational background necessary for the practice of actuarial science and has had at least 7 years of actuarial experience.

IV. "Beneficiary" means any person receiving a retirement allowance or other benefit as provided in this chapter.

VI. "Creditable service" means prior service plus membership service, as provided in RSA 100-C:4.

VIII. "Judicial retirement plan" or "plan" means the New Hampshire judicial retirement plan as defined in RSA 100-C:2.

IX. "Member" means any full-time supreme court, superior court, district court, or probate court judge.

X. "Member annuity" means annual payments for life derived from the accumulated contributions of the member.

XI. "Membership service" means service rendered while a member of the judicial retirement plan.

XII. "Predecessor system" means any state retirement plans or systems for judges in effect prior to the date of implementation of the judicial retirement plan by this chapter.

XIII. "Regular interest" means interest at such rate or rates compounded annually as may be set from time to time by the board of trustees.

XIV. "Retirement" means withdrawal from active service with a retirement allowance granted under the provisions of this chapter.

XV. "Retirement allowance" means the sum of the member annuity and the state annuity. All retirement allowances shall be payable in equal monthly installments which shall cease with the last monthly payment prior to death, unless otherwise specifically provided for in this chapter; provided, however, that if the retirement allowance is less than $10 per month, it may be paid, at the discretion of the board of trustees, in quarterly or semiannual installments due at the midpoint of such period, or in a lump sum of equivalent actuarial value.

XVI. "Retirement system" means the New Hampshire retirement system as defined in RSA 100-A:2.

XVII. "Service" means service as a supreme court, superior court, full-time district court, or full-time probate court justice.

XIX. "State annuity" means annual payments for life derived from contributions by the state.

XX. "Terminal funding" means providing the full present value of the total liability for benefit improvement. Unless otherwise specified, the source of terminal funding shall be the special account established under RSA 100-A:13, III(g).

I. The judicial retirement plan is hereby established. It shall be known as the New Hampshire judicial retirement plan, and by such name all of its business shall be transacted, all of its funds invested, and all of its cash, securities and other property held in trust for the purpose for which received. It is intended for all time to meet the requirements of a qualified pension trust within the meaning of section 401(a), and to qualify as a governmental plan within the meaning of section 414(d) of the United States Internal Revenue Code of 1986, as amended. It is a defined benefit plan providing disability, death, and retirement protection to members and their families.

II. The board of trustees shall have the exclusive authority and full power to invest and manage those assets of the judicial retirement plan and may cause any stock or other securities to be registered and held in the name of a nominee without mention of the judicial retirement plan's ownership, provided that no nominee shall have possession of or access to the stock or other securities unless the nominee shall be an officer of a corporate custodian of such stock or other securities, in which case the custodian shall maintain on its books accurate and current records of the New Hampshire judicial retirement plan's interest in such stock or other securities and the custodian shall be strictly liable for all acts or omissions of the nominee in connection with such stock or other securities and the nominee shall be bonded by the custodian.

100-C:3 Membership. Membership in the judicial retirement plan shall be mandatory for any full-time supreme court, superior court, district court, or probate court judge.

I. Creditable service at retirement on which the retirement allowance of a member shall be based shall consist only of that membership service since such judge became a member of the judicial retirement plan plus that service credited a member for retirement allowance, if any, under the provisions of former RSA 490:2; RSA 491:2, RSA 502-A:6-a, or RSA 547:2-a in effect on the date of implementation of this chapter.

II. The board shall fix and determine by appropriate rules how much service in any year is equivalent to one year of service, but in no case shall it allow credit for a period of absence without pay of more than a month's duration, nor shall more than one year of service be creditable for all service in a calendar year. Service rendered for the full normal working time in any year shall be equivalent to one year's service.

I. Any member who has at least 15 years of creditable service and is at least 60 years of age, or who has at least 10 years of creditable service and is at least 65 years of age, or who has at least 7 years of service and is 70 years of age may retire on a service retirement allowance or a reduced service retirement allowance, upon written application to the board setting forth on what date, not less than 30 days nor more than 90 days subsequent to the filing of the application, the member desires to be retired. During such period of notification, the member may have separated from service.

II. A member who is at least 65 years of age with 10 years of creditable service may retire on a service retirement allowance equal to 75 percent of the member's final year's salary.

III. A member who is 70 years of age with 7 years of creditable service may retire on a service retirement allowance equal to 45 percent of the member's final year's salary. A member who is 70 years of age shall be granted an additional 10 percent over the 45 percent level for each year of creditable service the member has over 7 years.

IV. A member who is at least 60 years of age with at least 15 years of service may retire on a service retirement allowance equal to 70 percent of the member's final year's salary. A member who has at least 15 years of service and is at least 60 years of age shall be granted an additional percent over the 70 percent level for each year of continued service over 15 years.

V. Under no circumstance shall any service retirement allowance pursuant to this section exceed 75 percent of the member's final year's salary.

VI. Any member attaining eligibility for 75 percent of the member's final year's salary shall not be required to make employee contributions to the plan pursuant to RSA 100-C:14.

100-C:6 Disability Retirement Benefits. Regardless of a member's length of service, any member who becomes permanently and totally disabled may apply to the board of trustees to retire on a disability retirement allowance not less than 30 nor more than 90 days subsequent to the filing of such application. Such application shall be granted provided that a physician or physicians designated by the board of trustees, after a medical examination of such member, certifies that the member is mentally or physically incapacitated for further performance of duty, that such incapacity is likely to be permanent, and that such person should be retired. A member's disability retirement allowance shall be equal to 70 percent of the member's final year's salary.

I. If a member dies in office, his or her surviving spouse, as long as he or she remains unmarried, or, if the member leaves no spouse, or at the surviving spouse's death or remarriage, then the member's child or children under the age of 18 years and until they respectively reach their eighteenth birthday, shall annually be entitled to 1/2 of the member's final year's salary. In case there is more than one child, the compensation shall be divided equally among them.

II. If such member dies having terminated service as such and having become entitled to benefits pursuant to RSA 100-C:5 or RSA 100-C:6, his or her surviving spouse, as long as he or she remains unmarried, or, if the member leaves no spouse, or at the surviving spouse's death or remarriage, then the member's child or children under the age of 18 years and until they respectively reach their eighteenth birthday, shall annually be entitled to 1/2 the member's final year's salary. In case there is more than one child, the compensation shall be divided equally among them.

I. If a member ceases to be a judge for reasons other than retirement or death, the amount of such member's accumulated contributions shall be paid to such member within 3 months after such member's written request therefor, provided that the member may not file a written request for such payment until at least 30 days from the date the member ceases to be a judge. Upon the refund of such contributions all rights of the member, any beneficiary, and any survivor of the member under this chapter shall terminate.

II. Upon the death of a member in service who does not have a surviving spouse or dependent children, the amount of the member's accumulated contributions shall be paid to any beneficiary or beneficiaries nominated by the member, if living, or otherwise to the member's estate.

III. Upon the death of a member who does not have a surviving spouse or dependent children, after retirement allowance payments have commenced, any excess amount of the member's accumulated contributions at retirement over the sum of the retirement allowance payments received shall be paid in one sum to the beneficiary or beneficiaries nominated by the member, if living, otherwise to the member's estate.

IV. The return of a member's contributions shall include accrued interest at such rates as the board of trustees may from time to time determine in its discretion.

100-C:9 Designation of Beneficiaries; Effect. When more than one person is designated by the member as beneficiary under this chapter, the member may provide the portion of the whole sum which each designee shall receive and may also provide that on the death of one of multiple designees the share of that designee shall automatically be added to the share of another or other designees or be payable to the estate of the member.

100-C:10 Maximum Benefit Limitations. Notwithstanding any other provisions of this chapter, the maximum benefit payable to any retired member or beneficiary of the New Hampshire judicial retirement plan shall be limited to such extent as may be necessary to conform to the requirements of sections 401(a)(9) and 415 of the United States Internal Revenue Code of 1986 for a qualified retirement plan.

I. The judicial retirement plan shall be administered by a board of trustees, which shall be separate from the board of trustees of the New Hampshire retirement system. The board of the judicial retirement plan shall have the exclusive authority and full power to administer and to invest and manage those assets of the judicial retirement plan.

II. The board of trustees of the judicial retirement plan shall consist of 7 members. The governor and council shall appoint 2 trustees, one of whom the governor shall designate to serve as chairman of the board of trustees, and who shall be qualified persons with business experience and not members of the judicial retirement plan, and who shall serve for a term of 3 years and until such trustee's successor is appointed and qualified, except that the original appointment of one of the trustees shall be for a term of one year. The chief justice of the state supreme court, with the advice and consent of the chief justice of the superior court and the administrative justices of the district and probate courts, shall appoint 3 trustees, who shall be active members of the judicial retirement plan, and who shall serve for a term of 3 years and until such trustee's successor is appointed and qualified, except that the original appointment of one of the trustees shall be for a term of one year, and the original appointment of another of the trustees shall be for a term of 2 years. One member of the state senate shall be appointed biennially by the senate president as a trustee of the board, and one member of the house of representatives shall be appointed biennially by the speaker of the house as a trustee of the board.

III.(a) In addition to those other powers conferred herein, the board of trustees shall have exclusive authority and full power, consistent with the board's duties under this chapter, to:

(1) Establish an administrative budget sufficient to exercise the board's powers and to perform the board's duties and, as appropriate and reasonable, draw upon assets of the plan to fund the budget;

(2) Obtain by employment or contract the services necessary to exercise the board's powers and perform the board's duties, including actuarial, auditing, custodial, investment, and legal services; and

(3) Procure and dispose of goods and property necessary to exercise the board's powers and perform the board's duties.

(b) In exercising its authority under this section, the board shall be subject to the fiduciary duties of this chapter, but not to civil service, personnel, procurement, or similar general laws relating to the subjects of subparagraph III(a).

IV. The members of the board of trustees shall serve without compensation but shall be reimbursed for actual and necessary traveling and other expenses and disbursements incurred or made by them in the discharge of their official duties.

V. Each trustee shall be entitled to one vote in the board of trustees. Five trustees shall constitute a quorum for the transaction of any business. Four trustees voting shall be necessary for any resolution or action by the board at any meeting.

VI.(a) The board may engage such administrative services as may be required to transact the business of the judicial retirement plan. The compensation for such services, and all other necessary expenses of the board shall be paid at such rates and in such amounts as the board shall approve. The New Hampshire retirement system may be engaged to provide such administrative services to the judicial retirement plan on such terms as the board of trustees of each plan may both agree.

(b) The board may delegate functions, including the administration of the plan, that a prudent trustee acting in a like capacity and familiar with such matters could properly delegate under the circumstances.

(1) Selecting an agent, including administrator of the judicial retirement plan;

(2) Establishing the scope and terms of the delegation, consistent with the purposes and terms of this chapter; and

(3) Periodically reviewing the agent's performance and compliance with the terms of the delegation.

(d) In performing a delegated function, an agent owes a duty to the judicial retirement plan and to its members and beneficiaries to comply with the terms of the delegation and, if a fiduciary, to comply with the duties imposed by this chapter.

(e) A trustee of the board who complies with subparagraphs (b) and (c) shall not be liable to the plan or to its members or beneficiaries for the decisions or actions of the agent to whom the function was properly delegated.

(f) By accepting the delegation of a function from the board, an agent submits to the jurisdiction of the courts of this state.

(g) The board may limit the authority of an agent to further delegate functions under this section.

VII. The board shall keep a record of all of its proceedings. In furtherance of public disclosure:

(2) A summary description of any material modification in the terms of the plan and any material change in the information required to be contained in the summary plan description, to the extent the modification or change has not been integrated into an updated summary plan description;

(b) The board shall make available for public examination in the principal administrative offices of the plan or in such other places as the board may designate:

(3) Summary descriptions of modifications or changes described in subparagraph (a)(2) that have been provided to members and beneficiaries but have not yet been integrated into the summary plan description;

(c) Upon written request by a plan member, beneficiary, or member of the public, the board by its administrator shall provide a copy of any publication described in subparagraph (b). Except as otherwise provided herein, the board may charge a reasonable fee to cover the cost of providing copies. The board by its administrator shall provide the copies within 30 days after the request or, if a fee is charged, within 30 days after receiving payment.

VIII. The board of trustees shall direct the administrator of the plan to make the following disclosure to members and beneficiaries of the judicial retirement plan:

(a) The administrator shall furnish to each member and to each beneficiary who is receiving benefits under the plan:

(1) A copy of the most recent summary plan description, along with any summary descriptions of modifications or changes described in paragraph VII(a)(2); within 30 days after a person becomes a member or, in the case of a beneficiary, within 30 days after a person first receives benefits;

(2) The summary description of any modifications or changes described in paragraph VII(a)(2), within 7 months after the end of the fiscal year of the plan in which a modification or change has been made;

(3) A copy of an updated summary plan description that integrates all modifications and changes at intervals not exceeding 5 years; and

(4) The annual report within 7 months after the end of each fiscal year of the plan.

(b) The board by its administrator shall provide to a member or beneficiary a statement containing information that would permit the member or beneficiary to reasonably estimate projected benefits to the extent the information is regularly maintained by the plan. The information may be provided periodically with the annual report or upon written request of the member or beneficiary. The information need not be provided to a member or beneficiary who is currently receiving benefits.

(c) A member who is not currently receiving benefits is entitled without charge to one statement under subparagraph (b) during any fiscal year of the plan. The administrator may charge a reasonable fee to cover the cost of providing additional statements. The administrator shall provide the statements within 30 days of receipt of the member or beneficiary's written request or, if a fee is charged, within 30 days after receiving payment.

(d) A summary plan description and summary description of modifications or changes provided herein must be written in a manner calculated to be understood by the average member and be accurate and sufficiently comprehensive reasonably to inform the members and beneficiaries of their rights and obligations under the plan and shall contain:

(5) A description of the plan's requirements concerning eligibility for participation and benefits;

(6) A description of the plan's provisions providing for nonforfeitable benefits;

(7) A description of circumstances that may result in disqualification, ineligibility, or denial or loss of benefits;

(8) A description of the benefits provided by the plan, including the manner of calculating benefits and any benefits provided for spouses and survivors;

(12) The procedures to claim benefits under the program and the administrative procedures available under the program for the redress of claims that are denied in whole or in part; and

(1) The summary plan and of updated summary plan descriptions at the same time such are first furnished to plan members or beneficiaries pursuant to subparagraph (a)(3);

(2) Any summary description of modifications or changes within 7 months after the end of the fiscal year in which a modification or change has been made; and

(3) Disclosures of the plan's financial and actuarial status and its annual report within 7 months after the end of each fiscal year of the plan.

IX. The board shall make disclosures of the financial and actuarial status of the judicial retirement plan as provided herein.

(1) An auditing agency of this state which has no direct relationship with the functions or activities of the judicial retirement plan or its fiduciaries other than:

(B) A person who is an independent public accountant, certified or licensed by a regulatory authority of a state.

(2) The individual's descendant, sibling, or parent, or the spouse of the individual's descendant, sibling, or parent;

(4) A trust or estate in which an individual described in above subparagraphs (1), (2), or (3) has a substantial interest;

(5) A trust or estate for which the individual has fiduciary responsibilities; or

(6) An incompetent, ward, or minor for whom the individual has fiduciary responsibilities.

(2) The name and principal business office of the administrator appointed by the board of trustees;

(3) The name and business address of each member of the board of trustees and a brief description of how the trustee was selected;

(7) Financial statements and notes to the financial statements in conformity with generally accepted accounting principles;

(8) An opinion on the financial statements by a qualified public accountant in conformity with generally accepted auditing standards;

(9) Actuarial schedules and notes to the actuarial schedules in conformity with generally accepted actuarial principles and practices for measuring pension obligations;

(10) An opinion by the actuary that the actuarial schedules are complete and accurate to the best of the actuary's knowledge, that each assumption and method used in preparing the schedules is reasonable, that the assumptions and methods in the aggregate are reasonable, and that the assumptions and methods in combination offer the actuary's best estimate of anticipated experience;

(11) A description of any material interest held by any trustee, administrator, or employee who is a fiduciary with respect to the investment and management of assets of the plan, and, if the fiduciary is an individual, by a related person of the beneficiary, in any material transaction with the plan within the last 3 years or proposed to be effected;

(12) A schedule of the rates of return, net of total investment expense, on assets of the plan overall and on assets aggregated by category over the most recent one-year, 3-year, 5-year, and 10-year periods, to the extent available, and the rates of return stated against appropriate benchmarks for assets of the system overall and for each category over each period; and

(13) A schedule of the sum of total investment expense and total general administrative expense paid by the plan for the fiscal year expressed as a percentage of the fair value of assets of the system on the last day of the fiscal year, and an equivalent percentage for the preceding 5 fiscal years.

(b) The financial statements, but not the notes, required by paragraph IX(c)(7);

(f) Other material to summarize fairly and accurately the annual disclosure of the plan's financial and actuarial status; and

(g) A general notice of the availability of the public, member and beneficiary information provided herein.

100-C:12 Fiduciary Duties of Board of Trustee in Investing and Managing Assets of Judicial Retirement Plan.

I. The members of the board of trustees shall be the trustees of all funds of the judicial retirement plan created under this chapter and shall have full power to invest, and reinvest such funds, subject to all the terms, conditions, limitations, and restrictions herein. Each member of the board of trustees or other fiduciary shall discharge duties with respect to the plan:

(b) For the exclusive purpose of providing benefits to members and beneficiaries and paying reasonable expenses of administering the plan;

(c) With the care, skill, and caution under the circumstances then prevailing which a prudent person acting in a like capacity and familiar with those matters would use in the conduct of an activity of like character and purpose;

(d) Impartially, taking into account any differing interests of members and beneficiaries;

(f) In accordance with a good-faith interpretation of the law governing the judicial retirement plan.

II. In investing and managing assets of the judicial retirement plan, the board of trustees:

(4) Needs for liquidity, regularity of income, and preservation or appreciation of capital; and

(b) Shall diversify the investments of the plan unless the board reasonably determines that, because of special circumstances, it is clearly prudent not to do so;

(d) May invest in any kind of property or type of investment consistent with the fiduciary provisions of this chapter.

III. The board may return a member or state contribution, or make alternative arrangements for reimbursement, if the board determines the contribution was made because of a mistake of fact or law.

IV. In evaluating the performance of a trustee or other fiduciary of the plan, compliance by the trustee or other fiduciary with those duties and liabilities under this chapter shall be determined in light of the facts and circumstances existing at the time of the trustee or fiduciary's decision or action and not by hindsight; and the board's investment and management decisions shall be evaluated not in isolation but in the context of the trust portfolio as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the plan.

V. The board of trustees may insure against liability or losses occurring because of a breach of duty hereunder if the insurance is purchased or provided either by the trustee or fiduciary personally or, on the trustee or fiduciary's behalf, by the state, the plan, the employer whose members participate in the plan, or the trustee or fiduciary's employer.

I. All of the assets of the judicial retirement plan shall be credited, according to the purpose for which they are held, between 2 funds, namely, the member annuity savings fund and the state annuity accumulation fund. In making the determinations required under this section for financing the judicial retirement plan, the board shall determine and use an appropriate actuarial funding methodology. The board shall direct the plan's actuary to prepare biennial valuations of the system's assets and liabilities commencing with a valuation prepared as of the date of implementation of this chapter. Such biennial valuation shall be the sole basis for determining the annual contribution requirements of the judicial retirement plan until the next following biennial valuation.

(a) The member annuity savings fund shall be a fund in which shall be accumulated the contributions deducted from the compensation of members to provide for their member annuities. The board of trustees shall certify to the proper authority responsible for making up the payroll of the judicial branch, and such authority shall cause to be deducted from the compensation of each member, on each and every payroll for each and every payroll period, the percentage of earnable compensation applicable to such member. In determining the amount earnable by a member in a payroll period, the board may consider the rate of compensation payable to such member on the first day of a payroll period as continuing throughout the payroll period and it may omit deduction from compensation for any period less than a full payroll period if such person was not a member on the first day of the payroll period, and to facilitate the making of deductions it may modify the deduction required of any member by such an amount as shall not exceed 1/10 of one percent of the annual earnable compensation upon the basis of which such deduction is made. The amounts deducted shall be reported to the board. Each of such amounts, when deducted, shall be paid to the judicial retirement plan at such times as may be designated by the board and credited to the individual account, in the member annuity savings fund, of the member from whose compensation the deduction was made.

(b) Every member shall be deemed to consent and agree to the deductions provided in this section as a condition of membership.

(c) The accumulated contributions of a member withdrawn by such member, or paid to such member's estate or to such member's designated beneficiary in event of the member's death in service, shall be paid from the member annuity savings fund. Upon the retirement of a member, such member's accumulated contributions shall be transferred from the member annuity savings fund to the state annuity accumulation fund.

(a) The state annuity accumulation fund shall be the fund in which shall be accumulated all reserves for the payment of all state annuities payable from contributions made by the state, any amounts transferred to the fund from a similar fund under one or more of the predecessor systems, and amounts transferred from the member annuity savings fund and from which shall be paid all benefits payable under the plan other than those payable from the member annuity savings fund.

(b) The contributions of the state for benefits under the judicial retirement plan shall consist of a percentage of the earnable compensation of its members to be known as the "normal contribution," and an additional amount to be known as the "accrued liability contribution." The rate percent of such normal contribution in each instance shall be fixed on the basis of the liabilities of the plan with respect to its members.

(c) Commencing with the valuation as required in paragraph I, the actuary in determining the percentage normal contribution rate may include a projection of the membership, earnable compensation, and assets of the judicial retirement plan from the valuation date to the beginning of the year to which such percentage normal contribution rate is applicable; or the actuary may base such determination on the anticipated level of contribution as is necessary to maintain such reasonable actuarial funded ratio as may be directed by the board of trustees, and for purposes of this determination the actuarial funded ratio shall be the ratio of the fair market value of the judicial retirement plan's assets to the present value of accumulated benefits under the judicial retirement plan for all members, but without regard to any future compensation increase.

(d) Immediately following the actuarial valuation prepared under paragraph I, the board shall have an actuary determine the amount of the unfunded accrued liability as the amount of the total liabilities of the state annuity accumulation fund which is not dischargeable by the total of the funds in hand to the credit of the state annuity accumulation fund, and the normal contributions to be made on account of the members during the remainder of their active service. The amount so determined shall be known as the "unfunded accrued liability". On the basis of the unfunded accrued liability, the board shall have an actuary determine the level annual contribution required to discharge such amount over a period of 20 years from the date of implementation of this chapter.

(e) The total amount payable to the state annuity accumulation fund in each year shall not be less than the normal contribution rate multiplied by the total compensation earnable by all members for such year, plus the amount of the accrued liability contribution necessary to liquidate the unfunded accrued liability as determined by the actuary under subparagraph (d) above.

(f) All interest and dividends earned on the funds of the judicial retirement plan shall be credited to the state annuity accumulation fund. The board shall allow interest at such rate or rates as it shall determine from time to time on the individual accounts of members in the member annuity savings fund and shall annually transfer such interest amount from the state annuity accumulation fund. Such interest shall be compounded monthly or more frequently as the board of trustees may determine and shall be allowed to the date of processing upon termination of active service for any reason including withdrawal, retirement, or death.

(g) There shall be a special account for additional benefits held by the board of trustees. Beginning with the first state fiscal year ending after the date of implementation of the judicial retirement plan, all of the earnings of the judicial retirement plan which are in excess of 9.5 percent shall be allocated to the special account. None of the assets held in the special account shall be used in the actuarial determination of the rate percent of normal contribution as set forth in subparagraphs (b) and (c). The actuarial cost of all legislation enacted during each fiscal year and calling for funding from the special account shall be withdrawn from the special account, as of June 30 of each year, after funds are credited to the special account as provided in this subparagraph. The special account shall be used only to fund or partially fund additional benefits as follows: first, to provide supplemental allowances, or COLAs, pursuant to RSA 100-C:17, and, second, to the extent that funds may be available in the special account, to provide additional benefits to retired members and beneficiaries of the judicial retirement plan.

IV. State Contributions. On or before the first day of October preceding each regular session of the state legislature, the board of trustees shall certify to the commissioner of administrative services the amounts which will become due and payable by the state during the biennium next following to the judicial retirement plan and it shall be the duty of the commissioner of administrative services in preparing the executive budget for each ensuing biennium to include in the budget the amounts so certified which amounts shall be appropriated by the legislature. The amounts so certified under this paragraph shall include the unfunded accrued liability of the judicial retirement plan; provided, however, that if bonds are issued to fund or eliminate the unfunded accrued liability, the payments of principal and interest for the bonds or notes shall be made from the general fund.

100-C:14 Member Contributions. All member contributions to the judicial retirement plan shall be payable only with respect to membership service, and picked up by the state by means of payroll deduction and shall be treated as employer contributions for purposes of Section 414(h) of the Internal Revenue Code of 1986, as amended. The member contribution rate shall be fixed biennially by the board of trustees and shall be calculated so that the rate percent of earnable compensation deducted is one-half of the annual contribution requirements of the judicial retirement plan as determined in RSA 100-C:13, I. In no year shall the member contribution rate exceed 10 percent of a member's earnable compensation. Once a member attains eligibility for a service retirement allowance equal to 75 percent of the member's final year's salary pursuant to RSA 100-C:5, said member shall not be required to have deductions made from earnable compensation for purposes of this section provided that the state contributions for such member under RSA 100-C:13, IV shall continue until the member's retirement.

I. The right of a person to any benefit or to any other right accrued or accruing to any person under the provisions of this chapter, and the moneys in the funds created by this chapter, shall be exempted from any state, county, or municipal tax in the state; shall not be subject to execution, trustee process, attachment or any other process whatsoever, legal or equitable; and shall be unassignable except as provided in paragraph II.

II. Notwithstanding any provision of law to the contrary, the right of a person to any benefit or to any other right accrued or accruing to any person under the provisions of this chapter, and the moneys in the funds created by this chapter shall be subject to assignment, attachment, and execution to the same extent as such rights under private retirement systems.

100-C:16 Protection Against Fraud. Any person who knowingly makes any false statement or falsifies or permits to be falsified any record or records of the judicial retirement plan in any attempt to defraud the system as a result of such act, shall be guilty of a class B felony if a natural person, or guilty of a felony if any other person. Should any change or error in the records result in any member or beneficiary receiving from the plan more or less than such person would have been entitled to receive had the records been correct, the board of trustees shall have the power to correct such error, and to adjust as far as practicable the payments in such a manner that the actuarial equivalent of the benefit to which such member or beneficiary was correctly entitled shall be paid.

I. On February 1 of each year, the fiscal committee of the general court may approve COLA's upon certification from the board of the amount of the COLA which may be granted based on the funds available in the special account. The board shall direct an actuary to certify to the fiscal committee the funds available, and any other information required by the committee, including but not limited to any change in the Consumer Price Index-Urban for the year prior to the year in which the allowance is granted. Any such supplemental allowance when granted by the fiscal committee of the general court shall become a permanent addition to the beneficiary's base retirement allowance, and shall be included in the monthly annuity paid to the retired member, or to the member's beneficiary if the member is deceased and the beneficiary is receiving an allowance.

II.(a) The granting of any such supplemental allowance, or of any increase in supplemental allowances, shall be contingent on terminal funding of the total actuarial cost thereof at the time of granting. Such terminal funding shall be from the special account established under RSA 100-C:13, III(g).

(b) No supplemental allowance shall be granted or increased if such grant or increase would reduce the funds in the special account to an amount less than zero.

311:2 Probate Court Judges; Retirement Benefits Reference Removed. Amend RSA 547:2-a to read as follows:

547:2-a Full-Time Judges. A probate judge designated to be full-time pursuant to RSA 491-A:4, IV shall not be permitted to engage in the practice of law to any degree. Full-time probate judges shall receive the salary specified in RSA 491-A:1 [~~and shall be entitled to the same disability and retirement benefits as full-time justices of the district court~~]. Full-time judges designated pursuant to RSA 491-A:4, IV shall assist the probate courts in the other counties whenever a probate judge in such other county is disqualified, disabled, or otherwise unable to sit.

District court justices prohibited from practice pursuant to $[~~106,187~~] 116,806

Probate judges prohibited from practice pursuant to RSA 547:2-a $[~~106,187~~] 116,806

311:4 District Court Judges; Part-Time. Amend RSA 491-A:3, III to read as follows:

III. The salary of a part-time justice shall not exceed 70 percent of the taxable salary of a full-time district court justice as provided by RSA 491-A:1. Judicial time shall be measured in weighted case units which shall reflect judicial time required to process a case. The compensation per weighted case unit shall be proportional to the taxable compensation for a full-time judge. A part-time justice, whose weighted caseload equals 3.5 judicial days per week, shall receive the maximum salary as provided by this section. The compensation schedule provided by this section shall be based upon the taxable salary of a full-time district court justice pursuant to RSA 491-A:1.

311:5 Probate Court Judges; Part-Time. Amend RSA 491-A:4, III to read as follows:

III. The salary of a part-time justice shall not exceed 70 percent of the taxable salary of a full-time district court justice as provided by RSA 491-A:1. Judicial time shall be measured in weighted case units which shall reflect judicial time required to process a case. The compensation per weighted case unit shall be proportional to the taxable compensation for a full-time judge. A part-time justice, whose weighted caseload equals 3.5 judicial days per week, shall receive the maximum salary as provided by this section. The compensation schedule provided in this section shall be based upon the taxable salary of a full-time district court justice pursuant to RSA 491-A:1.

I. Any judge, or the spouse or beneficiary of any such judge, who retired prior to the effective date of the repeals of RSA 490:2, RSA 491:2, RSA 493-A:2, and RSA 502-A:6-a by section 10 of this act or the amendment to RSA 547:2-a by section 2 of this act, shall continue to receive the disability and retirement benefits to which the person is entitled, provided however that the amount of the salary increase for current full-time judges provided in section 3 of this act, which amends RSA 491-A:1, shall not be included in the currently effective salary used for the calculation of the retired judge's disability or retirement benefit. Any other judicial salary increases shall be used for such calculation.

II. The supreme court is not required to consider the salary increase for full-time judges provided in section 3 of this act when determining proportional compensation of other judicial branch employees.

311:7 Appropriation. The sum of $250,000 is hereby appropriated for the fiscal year ending June 30, 2004 to the board of trustees of the judicial retirement system as established in this act. Such sum shall be nonlapsing and shall be used for legal, administrative, and other start-up costs of this act. The governor is authorized to draw a warrant for said sum out of any money in the treasury not otherwise appropriated.

311:8 Capital Appropriation; Unfunded Liability. The sum of $42,800,000 is hereby appropriated to the board of trustees of the judicial retirement system under RSA 100-C as established in this act. Such sum shall be used for the payment of the unfunded accrued liability attributable to the judicial retirement system.

311:9 Bonds Authorized. To provide funds for the appropriation made in section 8 of this act, the state treasurer is hereby authorized to borrow upon the credit of the state not exceeding the sum of $42,800,00 and for said purpose may issue bonds and notes in the name of and on behalf of the state of New Hampshire in accordance with RSA 6-A. Payments of principal and interest on the bonds and notes shall be made from the general fund of the state. The bonds shall have a term not later than 30 years from the date of issue.

I. RSA 490:2, relative to disability and retirement compensation for supreme court judges.

II. RSA 491:2, relative to disability and retirement compensation for superior court judges.

IV. RSA 502-A:6-a, relative to relative to disability and retirement compensation for district court judges.

311:11 Contingent Implementation of Judicial Retirement Plan. The provisions of section 1 of this act establishing RSA 100-C relating to contributions by members, retirement benefits, and operation of the judicial retirement plan and sections 2, 3, 6, 8, 9, and 10 of this act shall be implemented and made applicable beginning on the latter of July 1, 2004 or 180 days after the date that the board of trustees established in RSA 100-C certifies to the joint legislative fiscal committee of the judicial retirement plan's receipt of a favorable determination letter from the Internal Revenue Service as to the tax qualified status of the plan under section 401(a) of the Internal Revenue Code of 1986 as amended. Such date shall be the date of implementation of the judicial retirement plan. The provisions of RSA 100-C:11 for the appointment of the board and the administration of the duties and responsibilities of the board may begin on the effective date of this act.