00 Enrolled HB 116 01 Relating to the use of credited military service by retired peace officers and firefighters to 02 meet certain requirements for major medical insurance coverage; and providing for an 03 effective date. 04 _______________ 05 * Section 1. AS 39.35.340(b) is amended to read: 06 (b) In order to obtain credited service under this section, an employee shall 07 make an election to do so and shall verify the period of military service. When 08 eligibility for credited service for military service has been established, an 09 indebtedness shall be determined as follows: 10 (1) determine the employee's actual compensation, or the calculated 11 annual compensation for those employees working less than 12 months, during the 12 calendar year 1976 or the year in which an employee first becomes vested under 13 AS 39.35.095 - 39.35.680, whichever is later; [, MULTIPLIED BY] 14 (2) multiply the amount determined under (1) of this subsection by 01 the number of years of military service credited under this section; [, AND THIS 02 PRODUCT MULTIPLIED BY] 03 (3) multiply the product determined under (2) of this subsection by 04 six percent for members who are first eligible to claim this military service before 05 January 1, 1987, or eight and one-half percent for members who are first eligible to 06 claim this military service on or after January 1, 1987. [INTEREST AS 07 PRESCRIBED BY REGULATION ACCRUES ON THIS INDEBTEDNESS 08 BEGINNING ON JULY 1, 1977, OR ONE YEAR FOLLOWING THE DATE A 09 PERSON FIRST BECOMES VESTED, WHICHEVER IS LATER. ANY 10 OUTSTANDING INDEBTEDNESS THAT EXISTS AT THE TIME A PERSON IS 11 APPOINTED TO RETIREMENT NECESSITATES AN ACTUARIAL 12 ADJUSTMENT TO THE BENEFITS PAYABLE BASED UPON THAT MILITARY 13 SERVICE.] 14 * Sec. 2. AS 39.35.340 is amended by adding new subsections to read: 15 (j) Notwithstanding (d) of this section, a member who retires as a peace officer 16 or firefighter may elect to use five or fewer years of credited service granted under this 17 section in computing years of credited service under AS 39.35.535(c). When 18 eligibility for credited service for military service has been established and an election 19 under this subsection has been made, an indebtedness in addition to the indebtedness 20 determined under (b) of this section shall be determined for each year of military 21 service used under this subsection, in an amount based on the increase, if any, in the 22 present value of future benefits for that year as determined by the department. 23 (k) For indebtedness determined under this section, interest as prescribed by 24 regulation accrues beginning on July 1, 1977, or one year following the date a person 25 first becomes vested, whichever is later. An outstanding indebtedness for pension 26 benefits that exists at the time a person is appointed to retirement necessitates an 27 actuarial adjustment to the pension benefits payable based on credited military service. 28 * Sec. 3. AS 39.35.541 is amended by adding a new subsection to read: 29 (b) This section does not apply to an election to use service credit and a 30 corresponding indebtedness under AS 39.35.340(j). 31 * Sec. 4. This Act takes effect immediately under AS 01.10.070(c).