AB1098: Bill Text

LRB-5791/1

MIM:skw/cdc/emw

2023 - 2024 LEGISLATURE

2023 Assembly BILL 1098

February 20, 2024 - Introduced by Law Revision Committee. Referred to Committee on Rules.

AB1098,1,5 An Act to amend 40.05 (1) (b) 1a., 40.23 (1) (bm) and 40.63 (7) of the statutes; relating to: contributions by protective occupation participants and separation from service for retirement benefits under the Wisconsin Retirement System (suggested as remedial legislation by the Department of Employee Trust Funds).

Analysis by the Legislative Reference Bureau

This bill corrects a reference to a date for the purposes of contributions to the Wisconsin Retirement System by county jailers who are first certified as protective occupation participants for purposes of the WRS on or after January 1, 2024, in a county that did not classify county jailers as protective occupation participants before that date.

Under current law, if an application for long-term disability benefits or an application for a disability annuity by a participant who is at least minimum retirement age under the WRS is denied, and the applicant applies for a regular annuity, the effective date of the annuity is set as the date on which the disability benefits or disability annuity would have been effective. Federal law prohibits a participant in a qualified retirement plan, such as the WRS, from having a benefit effective date that is before the participant has a bona fide separation from service. The bill sets the effective date for a regular retirement annuity for participants whose application for long-term disability benefits or a disability annuity is denied as the later of the date that would have been the effective date of that annuity or those benefits or the day after the participant's separation from service.

For further information, see the Notes provided by the Law Revision Committee of the Joint Legislative Council.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

Law Revision Committee prefatory note: This bill is a remedial legislation proposal, requested by the Department of Employee Trust Funds and introduced by the Law Revision Committee under s. 13.83 (1) (c) 4. and 5., stats. After careful consideration of the various provisions of the bill, the Law Revision Committee has determined that this bill makes minor substantive changes in the statutes, and that these changes are desirable as a matter of public policy.

AB1098,1 Section 1. 40.05 (1) (b) 1a. of the statutes, as created by 2023 Wisconsin Act 4, is amended to read:

AB1098,2,7 40.05 (1) (b) 1a. Contributions under par. (a) 7. that are made by county jailers who are first certified as protective occupation participants on or after January 1, 2024, and who are employed in a county that did not classify county jailers as protective occupation participants on July 1, 2022 January 1, 2024, shall be treated as employee contributions.

Note: This Section changes a date for purposes of contributions to the Wisconsin Retirement System made by county jailers who were not classified as protective occupation participants before that date.

AB1098,2 Section 2. 40.23 (1) (bm) of the statutes is amended to read:

AB1098,2,16 40.23 (1) (bm) If an application by a participant age 55 or over, or by a protective occupation participant age 50 or over, for long-term disability insurance benefits is disapproved under rules promulgated by the department, the date which would have been the effective date for the insurance benefits, or the day after the date of separation from the last participating employer, whichever is later, shall be the retirement annuity effective date if requested by the applicant within 60 days of the disapproval or, if the disapproval is appealed, within 60 days of the final disposition of the appeal.

Note: This Section establishes that if certain participants in the Wisconsin Retirement System apply for long-term disability insurance benefits and the application is not approved under rules promulgated by the Department of Employee Trust Funds, the effective date for a regular retirement annuity will be the later of the date that would have been the effective date of the insurance benefits had the application been approved, or the day after the date of separation from the last participating employer.

AB1098,3 Section 3. 40.63 (7) of the statutes is amended to read:

AB1098,3,8 40.63 (7) If an application, by a participant age 55 or over, or by a protective occupation participant age 50 or over, for any disability annuity is disapproved, the date which would have been the disability annuity effective date , or the day after the date of separation from the last participating employer, whichever is later, shall be the retirement annuity effective date if so requested by the applicant within 60 days of the disapproval or, if the disapproval is appealed, within 60 days of final disposition of the appeal.

Note: This Section establishes that if certain participants in the Wisconsin Retirement System apply for disability insurance benefits and the application is not approved, the effective date for a regular retirement annuity will be the later of the date that would have been the effective date of the insurance benefits had the application been approved, or the day after the date of separation from the last participating employer.

AB1098,4 Section 4. Effective dates. This act takes effect on the day after publication, except as follows:

AB1098,3,12 (1) The treatment of s. 40.05 (1) (b) 1a. takes effect retroactively to January 1, 2024.

AB1098,3,13 (End)