2001 - 2002 LEGISLATURE
February 7, 2002 - Introduced by Representatives Bies, Sherman, J. Lehman,
Pocan, Musser, Ryba, Plouff, Gronemus, Williams, Black, Lassa, Turner
and
Lippert, cosponsored by Senators Risser, Burke, Wirch, Baumgart and
George. Referred to Joint Committee on Retirement Systems.
AB775,1,4 1An Act to amend 40.02 (17) (intro.), 40.22 (2) (a), 40.22 (2m) (intro.), 40.22 (2m)
2(a), 40.22 (3) (b) and 40.23 (2m) (fm); and to create 40.02 (33) (d) of the statutes;
3relating to: retirement benefits provided to educational support personnel
4under the Wisconsin retirement system.
Analysis by the Legislative Reference Bureau
This bill increases Wisconsin retirement system (WRS) benefits provided to an
"educational support personnel employee" who is defined under current law as any
school district employee other than a teacher, librarian, or administrator. The bill
makes the following changes to the WRS:
1. Under current law, to become covered under the WRS, an individual must
work for a covered employer at least one-third of what is considered full-time
employment, as determined by the department of employee trust funds (DETF) by
rule. For all WRS participants, other than teachers, librarians, and administrators,
DETF defines full-time employment to be 1,904 hours per year and one-third
employment to be 600 hours per year. In contrast, for teachers, librarians, and
administrators, DETF defines full-time employment to be 1,320 hours per year and
one-third employment to be 440 hours per year. This bill requires that educational
support personnel employees and teachers, librarians, and administrators must be
treated the same in terms of qualifying for coverage under the WRS, with full-time
employment for educational support personnel employees set at 1,320 hours per
year.

2. Under current law, the initial amount of a WRS annuity is calculated
according to one of two methods. One method consists in determining the initial
annuity amount based on the sum of a participant's accumulated additional and
employee required contributions plus an amount equal to the participant's
accumulated employee required contributions. The other method is to use a
retirement formula the variables of which are a participant's years of service,
formula multiplier, and final average earnings. The initial annuity amount that a
WRS participant may receive is the higher amount, as determined under the two
methods.
This bill provides that the final average earnings of an educational support
personnel employee are increased by 25% for the purpose of determining the initial
amount of a WRS retirement annuity under the second method.
3. Under current law, for early retirement purposes under the WRS, a
participant, other than a teacher, librarian, or administrator, with at least 0.75 of a
year of creditable service in any annual earnings period must be treated as having
one year of creditable service for that annual earnings period. To be eligible for the
treatment, the participant must have earned only a partial year of creditable service
in at least five of the ten annual earnings periods immediately preceding the annual
earnings period in which the participant terminated covered employment. This bill
reduces the amount that is required for the purpose of calculating what constitutes
a year of creditable service from 0.75 to 0.65 of a year of creditable service. The result
is that WRS participants need have worked fewer hours in a year in order to qualify
for this treatment for early retirement purposes.
This bill will be referred to the joint survey committee on retirement systems
for a detailed analysis, which will be printed as an appendix to this 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:
AB775, s. 1 1Section 1. 40.02 (17) (intro.) of the statutes is amended to read:
AB775,3,102 40.02 (17) (intro.) "Creditable service" means the creditable current and prior
3service, expressed in years and fractions of a year to the nearest one-hundredth, for
4which a participating employee receives or is considered to receive earnings under
5sub. (22) (e) or (em) and for which contributions have been made as required by s.
640.05 (1) and (2) and creditable military service, service credited under s. 40.25 (7)
7and service credited under s. 40.29, expressed in years and fractions of years to the

1nearest one-hundredth. How much service in any annual earnings period is the
2full-time equivalent of one year of creditable service shall be determined by rule by
3the department and the rules may provide for differing equivalents for different
4types of employment, except that the full-time equivalent of one year of creditable
5service for an educational support personnel employee is 1,320 hours
. Except as
6provided under pars. (i) and (k), the amount of creditable service for periods prior to
7January 1, 1982, shall be the amount for which the participant was eligible under
8the applicable laws and rules in effect prior to January 1, 1982. No more than one
9year of creditable service shall be granted for any annual earnings period. Creditable
10service is determined in the following manner for the following persons:
AB775, s. 2 11Section 2. 40.02 (33) (d) of the statutes is created to read:
AB775,3,1312 40.02 (33) (d) For an educational support personnel employee, the amount
13calculated under par. (a) multiplied by 1.25.
AB775, s. 3 14Section 3. 40.22 (2) (a) of the statutes is amended to read:
AB775,3,1815 40.22 (2) (a) Except as provided in sub. (2m), the employee is not expected to
16work at least one-third of what is considered full-time employment by the
17department, as determined by rule, or, for an educational support personnel
18employee, as specified under s. 40.02 (17) (intro.)
.
AB775, s. 4 19Section 4. 40.22 (2m) (intro.) of the statutes is amended to read:
AB775,4,220 40.22 (2m) (intro.) An employee who is not expected to work at least one-third
21of what is considered full-time employment by the department, as determined by
22rule, or, for an educational support personnel employee, as specified under s. 40.02
23(17) (intro.),
and who is not otherwise excluded under sub. (2) from becoming a
24participating employee shall become a participating employee if he or she is

1subsequently employed by the state agency or other participating employer for either
2of the following periods:
AB775, s. 5 3Section 5. 40.22 (2m) (a) of the statutes is amended to read:
AB775,4,64 40.22 (2m) (a) At least one year for at least one-third of what is considered
5full-time employment by the department, as determined by rule, or, for an
6educational support personnel employee, as specified under s. 40.02 (17) (intro.)
.
AB775, s. 6 7Section 6. 40.22 (3) (b) of the statutes is amended to read:
AB775,4,128 40.22 (3) (b) The first day after completion of one year of employment for at
9least one-third of what is considered full-time employment by the department, as
10determined by rule, or, for an educational support personnel employee, as specified
11under s. 40.02 (17) (intro.),
if the person becomes a participating employee under sub.
12(2m) after the employer's effective date of participation.
AB775, s. 7 13Section 7. 40.23 (2m) (fm) of the statutes is amended to read:
AB775,5,214 40.23 (2m) (fm) Notwithstanding s. 40.02 (17) (intro.), for purposes of
15determining creditable service under par. (f) 2., participants with at least 0.75 0.65
16of a year of creditable service in any annual earnings period shall be treated as
17having one year of creditable service for that annual earnings period. To be eligible
18for the treatment provided by this paragraph, the participant must have earned only
19a partial year of creditable service in at least 5 of the 10 annual earnings periods
20immediately preceding the annual earnings period in which the participant
21terminated covered employment, and the participant must notify the department of
22the applicability of this paragraph to the participant's service. The participant is not
23eligible for the treatment provided by this paragraph if such notification is provided
24by the participant later than 60 days after the participant's annuity effective date.

1This paragraph does not apply to service credited under s. 40.02 (15) or to creditable
2service as a teacher.
AB775, s. 8 3Section 8. Initial applicability.
AB775,5,64 (1) This act first applies to the calculation of benefits provided to participants
5in the Wisconsin retirement system who are participating employees in the
6Wisconsin retirement system on the effective date of this subsection.
AB775,5,77 (End)
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