Retirement cleanup bill approved

Lawmakers passed a cleanup measure related to Nebraska’s public employee retirement systems April 10.

LB820, introduced by the Nebraska Retirement Systems Committee, amends various sections of state law governing state and county retirement plans administered by the Nebraska Public Employees Retirement Systems, the Public Employees Retirement Board and the Nebraska Investment Council.

Among other provisions, the bill:
• changes the NPERS director’s title to executive director;
• consolidates language regarding approved identification documents for state retirement plan purposes;
• clarifies language regarding state contributions to the School Retirement Fund and the Omaha School Employees Retirement System Plan;
• provides for tax treatment of contributions under the Deferred Compensation Plan in designated Roth IRA accounts under the Internal Revenue Code; and
• deletes obsolete provisions related to the transfer of OSERS governance to the PERB, which is now complete.

The bill includes provisions of four additional bills.

LB433, introduced by Elkhorn Sen. Tony Sorrentino, amends the State Employees Retirement Act to provide that temporary state employees who previously were members of the state employees retirement system and return to state employment in fewer than 120 days will begin participation in the system within 30 days of returning as a temporary employee.

It also clarifies that employees of the Legislature who are hired for a limited period of time, or for a grant-funded position or a special project, will be considered temporary employees for purposes of the State Employees Retirement Act.

LB1102, sponsored by Sen. Beau Ballard of Lincoln, changes the adjustment date of cost-of-living adjustments under the Class V School Employees Retirement Act to align with the beginning of the plan year. Beginning in 2026, COLAs will be calculated and adjusted Sept. 1 of each year. The measure also changes the annuity payment date and the definition of retirement date under the act to align with the School Employees Retirement Act.

LB1103, introduced by Lincoln Sen. Eliot Bostar, increases the mandatory retirement age for members of the Nebraska State Patrol from 60 to 65 and authorizes members who joined the plan after July 1, 2016, to participate in the deferred retirement option plan.

Finally, LB1166, sponsored by Sen. Margo Juarez of Omaha, amends the School Employees Retirement Act to modify the timeline for annual adjustments to employee and employer contributions to the School Retirement Fund. Beginning in 2027, contribution rates will be calculated as of July 1 each year and apply beginning Sept. 1 of that year and prior to Sept. 1 the following year.

LB820 passed on a 49-0 vote and takes effect immediately.