Please direct any questions about the proposed rule to David Nispel, General Counsel, Department of Employee Trust Funds, P.O. Box 7931, Madison WI 53707. Telephone: (608) 264-6936. E-mail address: david.nispel@etf.wi.gov. Statement Explaining Need for Rule
This rule-making is needed to make technical updates to existing ETF rules, create consistency with statutes recently amended by the legislature, and to make other minor substantive changes.
Analysis Prepared by the Department of Employee Trust Funds
1. Statutes interpreted:
2. Statutory authority:
3. Explanation of agency authority:
By statute, the ETF Secretary is expressly authorized, with appropriate board approval, to promulgate rules required for the efficient administration of any benefit plan established in ch. 40 of the Wisconsin statutes. In addition, each state agency may promulgate rules interpreting the provisions of any statute enforced or administered by the agency if the agency considers it necessary to effectuate the purpose of the statute.
4. Related statutes or rules:
There are no other related statutes or administrative rules directly related to this technical rule.
5. Plain language analysis:
The objective of this technical rule is to make technical updates to existing ETF rules, delete obsolete language in ETF rules, create consistency with provisions in 2013 Wisconsin Act 20 related to rehired annuitants, and make other minor substantive changes. 6. Summary of, and comparison with, existing or proposed federal statutes and regulations:
The only federal regulations that may be affected by this proposed rule are provisions of the Internal Revenue Code regulating qualified pension plans. The Wisconsin Retirement System is required to be maintained as a qualified plan by s. 40.015, Stats. 7. Comparison with rules in adjacent states:
Periodically, retirement systems in adjacent states promulgate technical rules to update existing administrative rules.
8. Summary of factual data and analytical methodologies:
The department is proposing this rule to update existing rules and interpretations of existing statutes.
9. Analysis and supporting documents used to determine effect on small business or in preparation of economic impact analysis:
This rule does not have an effect on small businesses because private employers and their employees do not participate in, and are not covered by, the Wisconsin Retirement System. Please see attached economic impact analysis.
10. Effect on small business:
The rule has no effect on small businesses.
Regulatory Flexibility Analysis:
The proposed rule has no effect on small businesses because only governmental employers and their employees may participate in the benefit programs under ch. 40 of the statutes administered by the Department of Employee Trust Funds. Fiscal Estimate and Economic Impact Statement:
Please see the attached Fiscal Estimate and Economic Impact Statement.
Text of Proposed Rule
SECTION 1. ETF 10.01 (3e) is created to read:
ETF 10.01 (3e) “Highest basic pay rate” means, for purposes of s. 40.05, Stats., unless otherwise provided in a collective bargaining agreement under subch. V of ch. 111, Stats., the highest hourly rate, excluding any overtime or supplementary compensation, at which an employee accrued accumulated sick leave that is eligible for conversion under s. 13.121 (4), 36.30, 230.35 (2), 233.10, 238.04 (8), or 757.02 (5), Stats. Any supplemental compensation that is paid to a state employee who is classified under the state classified civil service as a teacher, teacher supervisor, or education director for the employee's completion of educational courses is considered as part of the employee's basic pay for purposes of this paragraph and s. 40.05, Stats. SECTION 2. ETF 10.01 (3i) is amended to read:
ETF 10.01 (3i) "Maximum voluntary contribution" means the total amount eligible under section 415 (c) of the internal revenue code, as adjusted pursuant to section 415(d) of the internal revenue code and the regulations promulgated pursuant to that section, to be contributed to the Wisconsin retirement system in a calendar year by or on behalf of a participating employee, less all required and employer-paid additional contributions which are includable in the limits of section 415 (c) of the internal revenue code, as determined by the department. SECTION 3. ETF 10.01 (3i) (Note 1) is repealed.
SECTION 4. ETF10.03 (1) is amended to read:
ETF 10.03 (1) For annual earnings periods beginning on or after January 1, 1985, each participating employer shall determine and report service in hours for each participating employee in the manner prescribed in this section. Earnings which are paid to a teacher, as defined in s. 40.02(55), Stats., an educational support personnel employee, as defined in s. 40.02 (22m), Stats., or a technical college educational support personnel employee, as defined in s. 40.02 (55g), Stats., who has contracted to receive such payments on either a 9 or 10 month contract basis, and which are paid after the beginning of a school year, as defined in s. ETF 10.01 (4m), for services rendered in the preceding school year, are deemed to be received by the teacher employee on June 30 of the preceding school year for purposes of reporting service to the department. ETF 10.01 NoteSECTION 5. ETF 10.08 (2) (a), and (c) 2. and 3. are amended to read:
ETF 10.08 (2) (a) Intent to terminate. No person may receive any retirement annuity, separation benefit or lump−sum payment from the Wisconsin retirement system without first terminating from his or her current participating employment with all participating employers. Whether the termination is a voluntary termination by the employee or an involuntary termination by the employer, the employer and employee shall act with the good−faith intent of ending the employee−employer relationship.
ETF 10.08 (2) (c) 2. The thirty-first seventy-sixth day after the benefit application is received by the department as provided in s. 40.23 (1) (a), Stats. ETF 10.08 (2) (c)ETF 10.08(2)(c)3. 3. The thirty-first seventy-sixth day after termination of employment in accordance with this section. SECTION 6. ETF 10.60 (2) is amended to read:
ETF 10.60 (2) Every employer which employs 250 or more employees shall submit the detailed annual earnings report required in the administration of subch. II of ch. 40, Stats., in an electronic format designated by the department. SECTION 7. ETF 10.633 (1) (a) to (c) are amended to read:
ETF 10.633 (1) (a) For a retirement annuity under s. 40.23 or 40.24, Stats., or s. ETF 20.04, and for a beneficiary annuity under s. 40.73 (3), Stats., the debit date shall be the twenty-first day of the same month as the date of the first annuity check or other transfer of funds payment. ETF 10.633 (1) (b) For a disability annuity under s. 40.63, Stats., the debit date shall be the twenty-first day of the same month as the date of the first disability annuity check or other transfer of funds payment. ETF 10.633 (1) (c) For a lump sum payment of any kind, including a separation benefit under s. 40.25 (2), Stats., or lump sum payments under s. 40.25 (1) or (4) or 40.73 (1) or (2), Stats., the debit date shall be the date of the benefit check payment.
