AB495, s. 13 3Section 13. 40.04 (4) (a) 2m. of the statutes is amended to read:
AB495,11,104 40.04 (4) (a) 2m. Debited, if a participant terminates covered employment on
5or after January 1, 1990, but before the effective date of this subdivision .... [revisor
6inserts date],
and applies for a benefit under s. 40.25 (2), with an amount equal to
7the amount by which the fixed annuity division interest credited on or after
8January 1, 1990, but before the effective date of this subdivision .... [revisor inserts
9date],
to employe required contributions, exceeds the interest crediting at an annual
10rate of 3% on each prior year's closing balance.
AB495, s. 14 11Section 14. 40.04 (7) (a) (intro.) of the statutes is amended to read:
AB495,12,912 40.04 (7) (a) (intro.) As otherwise elected by a participant prior to April 30,
131980, or on or after January 1, 2001. Any participant who was a participant prior
14to April 30, 1980, and
whose accounts on January 1, 1982, include credits segregated
15for a variable annuity shall have his or her employe required and additional
16contributions made on or after January 1, 1982, credited to the variable annuity
17division in a manner consistent with the participant's election prior to April 30, 1980,
18unless prior to January 1, 1982, the participant terminated such election under s.
1940.85, 1979 stats. Any participant who elects or has elected to have any of his or her
20credits segregated for a variable annuity on or after January 1, 2001, shall have his
21or her employe required and additional contributions made on or after the date of the
22participant's election, credited to the variable annuity division in a manner
23consistent with the participant's election.
The department shall by rule provide that
24any participant who elects or has elected variable participation prior to April 30,
251980, or on or after January 1, 2001, may elect to cancel that variable participation

1as to future contributions. The department's rules shall permit a participant who
2elects or has elected to cancel variable participation as to future contributions, or an
3annuitant, to elect to transfer previous variable contribution accumulations to the
4fixed annuity division. A transfer of variable contribution accumulations under this
5paragraph shall result in the participant receiving the accrued gain or loss from the
6participant's variable participation. A participant may specify that election to cancel
7participation in the variable annuity division is conditional. If the participant so
8specifies the election is effective on the first date on which it may take effect on which
9the participant:
AB495, s. 15 10Section 15. 40.05 (2) (cm) of the statutes is created to read:
AB495,12,1611 40.05 (2) (cm) The department may adjust the unfunded prior service liability
12balance of the Wisconsin retirement system under par. (b) and of each employer that
13makes contributions under par. (b) to reflect any changes in the assumed rate and
14the assumption for across-the-board salary increases specified in s. 40.02 (7) if the
15actuary recommends and the board approves the changes or if otherwise provided
16by law.
AB495, s. 16 17Section 16. 40.23 (2m) (b) of the statutes is amended to read:
AB495,13,618 40.23 (2m) (b) Except as provided in s. 40.26, subject to the limitations under
19section 415 of the internal revenue code Internal Revenue Code, the initial amount
20of the normal form annuity shall be an amount equal to 65% 70%, or 85% for
21participants whose formula rate is determined under par. (e) 4., of the participant's
22final average earnings plus the amount which can be provided under pars. (c) and
23(d) or, if less, shall be in the monthly amount equal to the sum of the amounts
24determined under pars. (c), (d) and (e) as modified by par. (f) and in accordance with
25the actuarial tables in effect on the annuity effective date. If the participant has

1creditable service under both par. (e) 4. and another category under par. (e), the
2percent applied under this paragraph shall be determined by multiplying the
3percent that each type of creditable service is of the participant's total creditable
4service by 85% and 65% 70%, respectively, and adding the results, except that the
5resulting benefit may not be less than the amount of the normal form annuity that
6could be paid based solely on the creditable service under par. (e) 4.
AB495, s. 17 7Section 17. 40.23 (2m) (e) 1. of the statutes is amended to read:
AB495,13,118 40.23 (2m) (e) 1. For each participant for creditable service of a type not
9otherwise specified in this paragraph that is performed before January 1, 2000,
101.765%; for such creditable service that is performed on or after January 1, 2000
,
111.6%.
AB495, s. 18 12Section 18. 40.23 (2m) (e) 2. of the statutes is amended to read:
AB495,13,1513 40.23 (2m) (e) 2. For each participant for creditable service as an elected official
14or as an executive participating employe that is performed before January 1, 2000,
152.165%; for such creditable service that is performed on or after January 1, 2000
, 2%.
AB495, s. 19 16Section 19. 40.23 (2m) (e) 3. of the statutes is amended to read:
AB495,13,2017 40.23 (2m) (e) 3. For each participant subject to titles II and XVIII of the federal
18social security act Social Security Act, for service as a protective occupation
19participant that is performed before January 1, 2000, 2.165%; for such creditable
20service that is performed on or after January 1, 2000
, 2%.
AB495, s. 20 21Section 20. 40.23 (2m) (e) 4. of the statutes is amended to read:
AB495,13,2522 40.23 (2m) (e) 4. For each participant not subject to titles II and XVIII of the
23federal social security act Social Security Act, for service as a protective occupation
24participant that is performed before January 1, 2000, 2.665%; for such creditable
25service that is performed on or after January 1, 2000
, 2.5%.
AB495, s. 21
1Section 21. 40.23 (2m) (em) of the statutes is created to read:
AB495,14,32 40.23 (2m) (em) 1. For the purpose of determining the applicable percentage
3rate under par. (e), all of the following shall apply:
AB495,14,64 a. Any creditable service forfeited by a participating employe before January
51, 2000, and which is subsequently reestablished by the participating employe under
6s. 40.25 (6), shall be considered to have been performed before January 1, 2000.
AB495,14,97 b. Any creditable service received under s. 40.25 (7), which is based on service
8performed before January 1, 2000, shall be considered to have been performed before
9January 1, 2000.
AB495,14,1210 c. Any creditable military service received under s. 40.02 (15) (c), which is based
11on creditable service performed before January 1, 2000, shall be considered to have
12been performed before January 1, 2000.
AB495,14,1413 2. This paragraph shall only apply to participants who are participating
14employes on or after January 1, 2000.
AB495, s. 22 15Section 22. 40.26 (2) (b) of the statutes is amended to read:
AB495,14,2416 40.26 (2) (b) The amount of the annuity payments, excluding any portion
17originally provided by additional contributions, which would have been paid under
18the terminated annuity, if the annuity had been a straight life annuity, prior to the
19participant's normal retirement date or prior to the annuity termination date,
20whichever would first occur, shall be credited to a memorandum account which is
21subject to s. 40.04 (4) (a) 2., 2g. and 2m. and (c). If the annuity was recomputed under
22s. 40.08 (1m) because of a qualified domestic relations order, the memorandum
23account established under this paragraph shall be adjusted as provided under s.
2440.08 (1m) (f) 2.
AB495, s. 23 25Section 23. 40.26 (5) (c) of the statutes is amended to read:
AB495,15,9
140.26 (5) (c) Any annuity or lump sum payment made to the participant shall
2be considered to have been made in error and is subject to s. 40.08 (4). The sum of
3the payments made in error shall be credited to a memorandum account. The
4memorandum account is subject to s. 40.04 (4) (a) 2., 2g. and 2m. and (c). If the
5annuity was recomputed under s. 40.08 (1m), the memorandum account established
6under this paragraph shall be adjusted pursuant to s. 40.08 (1m) (f) 2. The
7retirement account of a participant paid in error, and whose annuity was terminated,
8shall be reestablished as if the terminated annuity had never been effective,
9including the crediting of interest.
AB495, s. 24 10Section 24. 40.73 (1) (a) (intro.) of the statutes is amended to read:
AB495,15,1511 40.73 (1) (a) (intro.) Upon the death of a participant, other than an annuitant
12or a participating employe, the sum of the additional and employe required
13contribution accumulations credited to the participant's account on the beneficiary
14annuity effective date or, in the case of a lump sum payment, the first day of the
15month in which the death benefit is approved. In addition:
AB495, s. 25 16Section 25. 40.73 (1) (am) of the statutes is created to read:
AB495,15,2217 40.73 (1) (am) Upon the death of a participating employe who has not attained
18age 55, and any protective occupation participant who has not attained age 50, the
19sum of the additional contribution and twice the employe required contribution
20accumulations credited, including any interest credited to the accumulations, to the
21participant's account on the beneficiary annuity effective date or, in the case of a
22lump sum payment, the first day of the month in which the death benefit is approved.
AB495, s. 26 23Section 26. 40.73 (1) (c) of the statutes is amended to read:
AB495,16,1824 40.73 (1) (c) In lieu of the benefit payable under par. (a) or (b), upon Upon the
25death of a participating employe who, prior to death, met all of the requirements

1under s. 40.23 (1) except termination of employment and the filing of an application,
2if the beneficiary to whom a death benefit is payable is a dependent of the
3participating employe
natural person, or a trust in which such a beneficiary the
4natural person
has a beneficial interest, the present value on the day following the
5date of death of the life annuity to the beneficiary which would have been payable
6if the participating employe had been eligible to receive a retirement annuity,
7computed under s. 40.23 or 40.26, beginning on the date of death and had elected to
8receive the annuity in the form of a joint and survivor annuity providing the same
9amount of annuity to the surviving beneficiary as the reduced amount payable
10during the participant's lifetime. If there is more than one beneficiary the amount
11of the annuity and its present value will be determined as if the oldest of the
12beneficiaries were the sole beneficiary. If the death benefit payable to the beneficiary
13under this paragraph would be less than the amount determined under par. (a) or
14(b) the death benefit shall be payable under par. (a) or (b) and this paragraph shall
15not be applicable to the beneficiary. An annuitant receiving an annuity only under
16s. 40.24 (1) (f), which annuity was an immediate annuity, shall be deemed a
17participating employe for purposes of this paragraph only, but the amount payable
18under s. 40.24 (1) (f) shall not be changed.
AB495, s. 27 19Section 27. Nonstatutory provisions.
AB495,16,2120 (1) Transfer of funds from the transaction amortization account of the
21fixed retirement investment trust
.
AB495,17,322 (a) On December 31, 1999, after the annual distribution required under section
2340.04 (3) (a) of the statutes for the 1999 calendar year is made, $4,000,000,000 shall
24be distributed from the transaction amortization account of the fixed retirement
25investment trust to the reserves and accounts of the fixed retirement investment

1trust in an amount equal to a percentage of the total distribution determined by
2dividing each reserve's and account's balance on the prior January 1 by the total
3balance of the fixed retirement investment trust on the prior January 1.
AB495,17,254 (b) 1. The employe trust funds board shall determine each participating
5employer's share of the increase in the employer accumulation reserve that results
6from the distribution under paragraph (a ) and shall establish for each employer a
7credit balance in the employer accumulation reserve that equals the employer's
8share of the increase in the employer accumulation reserve that results from the
9distribution under paragraph (a), based on each employer's share of covered payroll
10in 1998. The total amount that shall be reserved for credit balances under this
11subdivision shall be $200,000,000. In lieu of requiring that an employer make
12required employer contributions under section 40.05 (2) (b) of the statutes, the
13employe trust funds board, beginning no later than March 1, 2000, shall deduct from
14the employer's credit balance in the employer accumulation reserve, on a monthly
15basis, an amount that the employer would otherwise have been required to
16contribute under section 40.05 (2) (b) of the statutes had there been no establishment
17of the credit balance from the distribution under paragraph (a). For any employer
18that is not required to make contributions under section 40.05 (2) (b) of the statutes,
19the employe trust funds board, beginning no later than March 1, 2000, shall deduct
20from the employer's credit balance in the employer accumulation reserve, on a
21monthly basis, an amount that the employer would otherwise have been required to
22contribute under section 40.05 (2) (a) of the statutes had there been no establishment
23of the credit balance from the distribution under paragraph (a). The employe trust
24funds board shall make such deductions until the credit balance is exhausted, at
25which time the employer shall resume making all required employer contributions.
AB495,18,5
12. The total amount of the increase in the employer accumulation reserve that
2results from the distribution under paragraph (a ) and that remains after the
3establishment of the credit balances under subdivision 1. shall, on the
4recommendation of the actuary, be applied to funding any liabilities created by the
5treatment of section 40.23 (2m) (e) 1., 2., 3. and 4. of the statutes in this act.
AB495,18,96 (c) The total amount distributed to the employe accumulation reserve under
7paragraph (a) shall be credited to participants' accounts based on their account
8balances as of January 1, 1999, pursuant to section 40.04 (4) (a) 2. and 2g. of the
9statutes.
AB495,18,1110 (d) The total amount distributed to the annuity reserve under paragraph (a )
11shall be distributed as provided under section 40.27 (2) of the statutes.
AB495,18,1212 (2) Purchase of legislative service.
AB495,18,1313 (a) In this subsection:
AB495,18,14 141. "Employer" has the meaning specified in section 40.02 (28) of the statutes.
AB495,18,16 152. "Final average earnings" has the meaning specified in section 40.02 (33) of
16the statutes.
AB495,18,18 173. "Legislative service agency" has the meaning specified in section 13.90 (1m)
18(a) of the statutes.
AB495,18,20 194. "Participating employe" has the meaning specified in section 40.02 (46) of the
20statutes.
AB495,19,1321 (b) Any person who is a participating employe on the effective date of this
22paragraph shall be granted creditable service under the Wisconsin retirement
23system for any service that was performed before the effective date of this paragraph
24as a member or employe of the legislature or employe of a legislative service agency
25and that has not been previously credited, if the participating employe was a member

1or employe of the legislature or employe of a legislative service agency for at least 600
2hours during the calendar year in which the service was performed or the calendar
3year immediately succeeding the calendar year in which the service was performed
4and if, not later than the first day of the 7th month beginning after the effective date
5of this paragraph, the participating employe submits an application for the
6creditable service to the department of employe trust funds and pays to the
7department a lump sum equal to the employe required contribution rate under
8section 40.05 (1) (a) of the statutes that is applicable to the service multiplied by the
9participating employe's final average earnings, determined as if the participating
10employe has terminated employment and applied for a retirement annuity under the
11Wisconsin retirement system on the date on which the department receives the
12participating employe's application for the creditable service, and by the number of
13months of creditable service granted under this paragraph.
AB495,19,1514 (c) An employer may pay any amount payable under paragraph (b ) on behalf
15of any participating employe.
AB495,19,2316 (d) Any liability incurred as a result of granting creditable service to a
17participating employe under paragraph (b ) that is not funded by the contributions
18made by the participating employe under paragraph (b ), or by the employer on behalf
19of the participating employe under paragraph (c ), shall be paid from the
20appropriation accounts under section 20.765 (1) (a) and (b) of the statutes. The
21amount apportioned to section 20.765 (1) (a) of the statutes and to section 20.765 (1)
22(b) of the statutes to fund the liability shall be determined by the presiding officers
23of each house of the legislature.
AB495,20,3
1(3) Authority of employe trust funds board. Notwithstanding any provision
2in this act, the employe trust funds board shall retain the authority to maintain
3proper actuarial funding of the Wisconsin retirement system.
AB495, s. 28 4Section 28. Initial applicability.
AB495,20,85 (1) Calculation of contribution rates. The treatment of section 40.02 (7) of
6the statutes first applies to the calculation of contribution rates under section 40.05
7(1) and (2) of the statutes for the Wisconsin retirement system for the 2001 calendar
8year.
AB495,20,129 (2) Calculation of retirement benefits. The treatment of section 40.23 (2m)
10(b) and (e) 1., 2., 3. and 4. of the statutes first applies to the calculation of retirement
11benefits for individuals who are participating employes in the Wisconsin retirement
12system on January 1, 2000.
AB495,20,1613 (3) Death benefits. The treatment of section 40.73 (1) (a) (intro.), (am) and (c)
14of the statutes first applies to death benefits paid to participants in the Wisconsin
15retirement system who are participating employes in the Wisconsin retirement
16system on the effective date of this subsection.
AB495,20,2017 (4) Variable annuity. The treatment of section 40.04 (7) (a) (intro.) of the
18statutes first applies to elections for variable annuity participation that are made by
19individuals who are participating employes in the Wisconsin retirement system on
20January 1, 2001.
AB495,20,2421 (5) Calculation of unfunded prior service liability balances. The treatment
22of section 40.05 (2) (cm) of the statutes first applies to the calculation of unfunded
23prior service liability balances under section 40.05 (2) (b) of the statutes for the
24Wisconsin retirement system for the 2001 calendar year.
AB495, s. 29
1Section 29. Effective dates. This act takes effect on the day after publication,
2except as follows:
AB495,21,63 (1) Elimination of transaction amortization account and creation of market
4recognition account.
The treatment of sections 25.17 (14) (f), 25.18 (1) (a) and (m)
5and 40.04 (3) (intro.), (a), (ab), (am) and (d) of the statutes takes effect on January
61, 2000.
AB495,21,77 (End)
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