The county and each participating agency must pay to the board each fiscal year a normal contribution and, if necessary, an additional contribution to be known as unfunded accrued liability contribution. The actuary for the retirement system must prepare an actuarial valuation and report each year.
(a) Normal contribution. The amount of normal contribution must at least match the contribution made by members each fiscal year but must not be less than the amount which could be provided by multiplying the latest published actuarial normal cost accrual rate, expressed as a percentage of covered payroll, times the payroll of covered members. The actuary for the retirement system must determine a single normal contribution, and, if necessary, an unfunded accrued liability contribution for each group which must be applicable to and payable by each participating agency. The normal contribution must be determined by the actuary for the retirement system after each actuarial valuation as the percentage of the compensation of all members which is sufficient to cover the cost of benefits determined under an actuarial cost method acceptable under the United States Treasury Regulations with respect to qualified retirement plans after taking into account members' contributions.
(b) Unfunded accrued liability contribution. The unfunded accrued liability contribution shall be the amount necessary to liquidate the base amount of the unfunded accrued liability and additions thereto, over not more than forty (40) years. The amount to liquidate annually shall be determined from the unfunded accrued liability published in the latest actuarial report. The base amount of unfunded accrued liability contributions payable by each participating agency shall be determined by the actuary on the basis of June 30, 1975, membership. Thereafter, the actuary shall determine additional unfunded accrued liabilities in excess of the June 30, 1975 base amount that emerge as the result of benefit improvements, salary increases or other applicable factors, which shall be applicable to and payable by each participating agency. The additional unfunded accrued liabilities shall be liquidated over not more than forty (40) years from date incurred.
(c) Additional contributions. The County shall make such contributions as are required annually to provide benefits under subsections (d) and (e) of section 33-45. Any contributions made on behalf of an employee who ceases to be a member as the result of separation from the County service shall be used each fiscal year to accelerate the payment of any unfunded accrued liability or to fund retirement plan improvements.
(d) Elected officials' plan. Subsections 33-40(a), (b), and (c) do not apply to the elected officials' plan. Instead, the following provisions apply:
(1) The County must contribute to the elected officials' plan in monthly installments, on behalf of each elected officials' participant, an amount equal to 8 percent of the elected officials' participants' regular earnings. The county's elected officials' contributions are to be adjusted to take into account any forfeiture under subsection 33-40(d)(2)d. In determining the amount of the County elected officials' contributions, only an elected officials' participant's regular earnings earned while that elected officials' participant made required elected officials' participant contributions are counted.
(2) The Board must allocate the County elected officials' contributions made on behalf of each elected officials' participant to a County elected officials' contributions account the Board establishes for that elected officials' participant. In addition, amounts allocated to the County elected officials' contributions account must be further allocated to sub-accounts to reflect the proportionate amount of each account in each of the applicable investment funds.
(A) As of each valuation date, the Board must value the County elected officials' contributions account of each participant on a current market value basis.
(B) An elected officials' participant has a one hundred (100) percent vested interest in that elected officials' participant's County elected officials' contributions account after the elected officials' participant attains the lesser of a full term of office or four (4) years of credited service. An elected officials' participant whose account balance in the County elected officials' contributions account is not one hundred (100) percent vested in accordance with the preceding sentence will nonetheless be one hundred (100) percent vested in that account balance from and after the effective date of a termination of the elected officials' plan.
(C) An elected officials' participant who has a one hundred (100) percent vested interest in the County elected officials' contributions account of that elected officials' participant and ends employment with the County before the participant's normal retirement date may, at the elected officials' participant's request, receive the account balance in the County elected officials' contributions account in a single lump-sum payment. An elected official who chooses to withdraw the account balance in the County elected officials' contributions account must at the same time withdraw the account balances in the required and voluntary elected officials' participant contributions accounts, and if that elected officials' participant again participates in the elected officials' plan after the withdrawal, that elected officials' participant must complete the lesser of an additional four (4) years of credited service or a full term of office in order to vest in any County elected officials' contributions made after the withdrawal.
(D) An elected officials' participant who ends employment with the County and who is not vested in any County contributions must forfeit the full account balance in the County elected officials' contributions account. If that occurs, the Chief Administrative Officer, upon the participant’s completion of a properly completed distribution form, must pay the participant, in a single lump-sum payment, the full account balances in the required elected officials' participant contributions account and the voluntary elected officials' participant contributions account, less any indebtedness to the county government or the Montgomery County Employees Federal Credit Union. The Chief Administrative Officer must consider all forfeitures arising under the elected officials' plan in determining the County elected officials' contributions and must use the forfeitures to reduce the amount of the county elected officials' contributions.
(e) Guaranteed Retirement Income Plan.
(1) Each pay period, the County must credit to each non-public safety member’s guaranteed retirement income plan account an amount equal to 6 percent for service beginning on the first pay period after June 30, 2011 and 8 percent for service beginning on the first pay period after June 30, 2012 of the member’s regular earnings. Interest must be credited at an annual rate of 7.25 percent on the County contribution credits. If the annual 7.25 percent interest rate does not comply with applicable law, the third segment rate described in Internal Revenue Code Section 430(h)(2)(G) or any successor provision must apply. Interest must be credited to a member’s guaranteed retirement income plan account balance on a monthly basis as of the last day of the month.
(2) Each pay period, the County must credit to each public safety member’s guaranteed retirement income plan account an amount equal to 8 percent for service beginning on the first pay period after June 30, 2011 and 10 percent for service beginning on the first pay period after June 30, 2012 of the member’s regular earnings. Interest must be credited at an annual rate of 7.25 percent on the County contribution credits. If the annual 7.25 percent interest rate does not comply with applicable law, the third segment rate described in Internal Revenue Code Section 430(h)(2)(G) or any successor provision must apply. Interest must be credited to a member’s guaranteed retirement income plan account balance on a monthly basis as of the last day of the month.
(3) When a member rejoins County service after military service that qualifies under Section 33-41(q) as credited service, the County must credit the member the amount that the County would have credited the member if the member worked for the County during military service. The credits must be based on the regular earnings the member would have earned during military service. If the regular earnings are not reasonably ascertainable, the County contribution credit must be based on the member’s regular earnings during a period immediately preceding military service. The averaging period is 12 months, or the full length of the member’s County service, whichever is shorter. The member must not receive any retroactive credited interest on the County contribution credits.
(4) For any member who received a contribution to the member’s guaranteed retirement income plan account under Section 33-42A, interest must be credited at an annual rate of 7.25 percent. If the annual 7.25 percent interest rate does not comply with applicable law, the third segment rate described in Internal Revenue Code Section 430(h)(2)(G) or any successor provision must apply. Interest must be credited to a member’s guaranteed retirement income plan account balance on a monthly basis as of the last day of the month. (Ord. No. 5-152; Ord. No. 6-195, § 1; 1972 L.M.C., ch. 19, § 5; 1974 L.M.C., ch. 31, § 6; 1978 L.M.C., ch. 44, § 1; 1987 L.M.C., ch. 27, § 7; 1987 L.M.C., ch. 29, § 5; 1994 L.M.C., ch. 33, § 1; 2001 L.M.C., ch. 21, § 1; 2008 L.M.C., ch.22, § 1; 2009 L.M.C., ch. 2, §§ 1, 2; 2009 L.M.C., ch. 15, § 1; 2009 L.M.C., ch. 23, § 1; 2009 L.M.C., ch. 33, § 2; 2010 L.M.C., ch. 13, § 1; 2011 L.M.C., ch. 9, § 1.)
Editor’s note—2011 L.M.C., ch. 9, § 2, states in part: Effective Date. This Act takes effect on July 1, 2011 except as otherwise provided. For a member of the Optional Plan, Integrated Plan, or Guaranteed Retirement Income Plan holding the office of County Executive, Councilmember, or Sheriff, the amendments to Sections 33-39(a)(1), 33-39(a)(2), 33-44(c), and 33-40(e)(1) took effect on December 1, 2014. For a member of the Optional Plan, Integrated Plan, or Guaranteed Retirement Income Plan holding the office of State’s Attorney, the amendments to Sections 33-39(a)(1), 33-39(a)(2), 33-44(c), and 33-40(e)(1) took effect on January 5, 2015.
2009 L.M.C., ch. 33, § 3, states, in part: Section 2 of this Act takes effect on December 6, 2010. An eligible individual who is an elected official on December 5, 2010, and remains in office on and after December 6, 2010, must decide to participate in the guaranteed retirement income plan on or before May 1, 2011. If an elected official decides to participate between December 6, 2010 and May 1, 2011, that elected official’s participation must begin on the first pay period after June 1, 2011.