LRB-2278/1
FFK:kjf
2017 - 2018 LEGISLATURE
April 20, 2017 - Introduced by Senators Stroebel, Moulton, Kapenga, Nass and
Marklein, cosponsored by Representatives August, Hutton, Allen, Duchow,
Gannon, Knodl and Steffen. Referred to Committee on Government
Operations, Technology and Consumer Protection.
SB190,1,5 1An Act to amend 40.02 (33) (a) (intro.), 40.02 (33) (c), 40.23 (1) (a) (intro.), 40.23
2(1) (am) 2., 40.23 (1) (bm), 40.25 (2) and 40.63 (7); and to create 40.02 (33) (am)
3of the statutes; relating to: increasing the minimum retirement age under the
4Wisconsin Retirement System and determining final average earnings for the
5purpose of calculating Wisconsin Retirement System annuities.
Analysis by the Legislative Reference Bureau
For individuals who first become participating employees in the Wisconsin
Retirement System on or after the effective date of this bill, this bill increases the
minimum retirement age for general participants from age 55 to age 60 and for
protective occupation participants from age 50 to age 52. The bill does not change
the minimum retirement age for an individual who was a participating employee in
the WRS before the effective date of the bill.
For individuals who first become participating employees in the WRS on or
after the effective date of this bill, this bill modifies the formula method for
calculating a participant's retirement annuity by calculating the participant's final
average earning using the participant's five highest annual earning periods rather
than three highest annual earning periods. Under current law, when a WRS
participant terminates covered employment and becomes eligible for an annuity, the
Department of Employee Trust Funds calculates the participant's annuity amount
using two methods and pays the participant an annuity using whichever method
results in a higher amount. The first method, known as the formula method, is based

on the participant's final average earnings, the participant's number of years of
creditable service, and a percentage multiplier. Under current law, a participant's
final average earnings is a monthly rate of earnings calculated based on the three
annual earnings periods in which the participant's earnings were highest. The
second method is to calculate the amount of a money purchase annuity, which is
determined based on the sum of a participant's accumulated required and additional
contributions plus an amount that equals the participant's accumulated required
contributions. This bill does not change the formula method for calculating a
participant's annuity if the participant was a participating employee in the WRS
before the effective date of the bill.
Because this bill relates to public employee retirement or pensions, it may be
referred to the Joint Survey Committee on Retirement Systems for a report to be
printed as an appendix to the bill.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB190,1 1Section 1. 40.02 (33) (a) (intro.) of the statutes is amended to read:
SB190,2,42 40.02 (33) (a) (intro.) The For a participant who was a participating employee
3before the effective date of this paragraph .... [LRB inserts date], the
monthly rate
4of earnings, ignoring any fractions of a dollar, obtained by dividing:
SB190,2 5Section 2. 40.02 (33) (am) of the statutes is created to read:
SB190,2,86 40.02 (33) (am) For a participant who first became a participating employee
7on or after the effective date of this paragraph .... [LRB inserts date], the monthly
8rate of earnings, ignoring any fractions of a dollar, obtained by dividing:
SB190,2,139 1. The participant's total earnings received or considered to be received under
10sub. (22) (e), (ef), or (em) and for which contributions are made under s. 40.05 (1) and
11(2) during the 5 annual earnings periods (excluding any period more than 5 years
12prior to the effective date for any participating employer) in which the earnings were
13the highest, subject to federal annual compensation limits; by
SB190,2,1414 2. Twelve times the total amount of creditable service for the 5 periods.
SB190,3
1Section 3. 40.02 (33) (c) of the statutes is amended to read:
SB190,3,42 40.02 (33) (c) For a participant who makes an election under s. 40.30 (2), the
3monthly rate of earnings applicable under par. (a), (am), or (b), increased as provided
4under s. 40.30 (4) (b) but subject to federal annual compensation limits.
SB190,4 5Section 4. 40.23 (1) (a) (intro.) of the statutes is amended to read:
SB190,3,206 40.23 (1) (a) (intro.) Except as provided in par. (am), any participant who was
7a participating employee before the effective date of this paragraph .... [LRB inserts
8date],
who has on or before the annuity effective date attained age 55, and any
9participant who first became a participating employee on or after the effective date
10of this paragraph .... [LRB inserts date], who has on or before the annuity effective
11date attained age 60,
any protective occupation participant who was a participating
12employee before the effective date of this paragraph .... [LRB inserts date],
who has
13on or before the annuity effective date attained age 50, on or before the annuity
14effective date
and any protective occupation participant who first became a
15participating employee on or after the effective date of this paragraph .... [LRB
16inserts date], who has on or before the annuity effective date attained age 52
shall
17be entitled to a retirement annuity in accordance with the actuarial tables in effect
18on the effective date of the annuity if the participant submits an application for a
19retirement annuity on a form furnished by the department and all of the following
20apply:
SB190,5 21Section 5. 40.23 (1) (am) 2. of the statutes is amended to read:
SB190,4,1122 40.23 (1) (am) 2. Any participant who has attained age 55 if the participant was
23a participating employee before the effective date of this paragraph .... [LRB inserts
24date], or age 60 if the participant first became a participating employee on or after
25the effective date of this paragraph .... [LRB inserts date],
and who is a participant

1because of employment other than part-time service as an elected official and who
2is also a participating employee because of part-time service as an elected official
3may, after termination of all covered employment other than service as a part-time
4elected official, waive further participation under the fund for his or her current, and
5any future, part-time service as an elected official. Any election under this
6paragraph is irrevocable and is effective beginning the day after the date of election.
7Notwithstanding par. (a), any participant who elects under this paragraph may
8receive a retirement annuity for all service under the fund credited to the participant
9to the date he or she elects. The date a participant elects under this paragraph is
10deemed to be the date of separation from the last participating employer by which
11that participant was employed.
SB190,6 12Section 6. 40.23 (1) (bm) of the statutes is amended to read:
SB190,4,2513 40.23 (1) (bm) If an application by a participant who was a participating
14employee before the effective date of this paragraph .... [LRB inserts date], who has
15attained
age 55 or over, or, by a participant who first became a participating
16employee on or after the effective date of this paragraph .... [LRB inserts date], who
17has attained age 60,
by a protective occupation participant who was a participating
18employee before the effective date of this paragraph .... [LRB inserts date], who has
19attained
age 50 or over, or by a protective occupation participant who first became
20a participating employee on or after the effective date of this paragraph .... [LRB
21inserts date], who has attained age 52
, for long-term disability insurance benefits
22is disapproved under rules promulgated by the department, the date which would
23have been the effective date for the insurance benefits shall be the retirement
24annuity effective date if requested by the applicant within 60 days of the disapproval
25or, if the disapproval is appealed, within 60 days of the final disposition of the appeal.
SB190,7
1Section 7. 40.25 (2) of the statutes is amended to read:
SB190,5,212 40.25 (2) Subject to sub. (2t), if all requirements for payment of a retirement
3annuity are met except attainment of age 55 or for participants who were
4participating employees before the effective date of this paragraph .... [LRB inserts
5date], age 60 for participants who first became participating employees on or after
6the effective date of this paragraph .... [LRB inserts date],
age 50 for protective
7occupation participants who were participating employees before the effective date
8of this paragraph .... [LRB inserts date], or age 52 for protective occupation
9participants who first became participating employees on or after the effective date
10of this paragraph .... [LRB inserts date]
, a separation benefit may be paid, if the
11participant's written application for a separation benefit is received by the
12department prior to the participant's 55th birthday or for participants who were
13participating employees before the effective date of this paragraph .... [LRB inserts
14date], 60th birthday for participants who first became participating employees on or
15after the effective date of this paragraph .... [LRB inserts date],
50th birthday for
16protective occupation participants who were participating employees before the
17effective date of this paragraph .... [LRB inserts date], or 52nd birthday for protective
18occupation participants who first became participating employees on or after the
19effective date of this paragraph .... [LRB inserts date]
, in an amount equal to the
20additional and employee required contribution accumulations of the participant on
21the date the application for a separation benefit is approved.
SB190,8 22Section 8. 40.63 (7) of the statutes is amended to read:
SB190,6,923 40.63 (7) If an application, by a participant who was a participating employee
24before the effective date of this paragraph .... [LRB inserts date], who has attained

25age 55 or over, or, a participant who first became a participating employee on or after

1the effective date of this paragraph .... [LRB inserts date], who has attained age 60,

2by a protective occupation participant who was a participating employee before the
3effective date of this paragraph .... [LRB inserts date], who has attained
age 50 or
4over
, or by a protective occupation participant who first became a participating
5employee on or after the effective date of this paragraph .... [LRB inserts date], who
6has attained age 52
, for any disability annuity is disapproved, the date which would
7have been the disability annuity effective date shall be the retirement annuity
8effective date if so requested by the applicant within 60 days of the disapproval or,
9if the disapproval is appealed, within 60 days of final disposition of the appeal.
SB190,6,1010 (End)
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