Montana Code 19-3-2117. Allocation of contributions and forfeitures
19-3-2117. Allocation of contributions and forfeitures. (1) The member contributions made under 19-3-315 and additional contributions paid by the member for the purchase of service must be allocated to the plan member’s retirement account.
Terms Used In Montana Code 19-3-2117
- Compensation: means remuneration paid out of funds controlled by an employer in payment for the member's services or for time during which the member is excused from work because of a holiday or because the member has taken compensatory leave, sick leave, annual leave, banked holiday time, or a leave of absence before any pretax deductions allowed by state or federal law are made. See Montana Code 19-3-108
- Defined benefit plan: means the plan within the public employees' retirement system established in 19-3-103 that is not the defined contribution plan. See Montana Code 19-3-108
- Employer: means the state of Montana, its university system or any of the colleges, schools, components, or units of the university system for the purposes of this chapter, or any contracting employer. See Montana Code 19-3-108
- Employer contributions: means payments to a pension trust fund pursuant to 19-3-316 from appropriations of the state of Montana and from contracting employers. See Montana Code 19-3-108
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Member: means a person with a retirement account in the defined contribution plan. See Montana Code 19-3-2101
(2)Subject to subsections (3) and (4), of the employer contributions under 19-3-316 received:
(a)an amount equal to:
(i)4.19% of compensation must be allocated to the member’s retirement account;
(ii)2.37% of compensation must be allocated to the defined benefit plan as the plan choice rate;
(iii)0.04% of compensation must be allocated to the education fund as provided in 19-3-112(1)(b); and
(iv)0.3% of compensation must be allocated to the long-term disability plan trust fund established pursuant to 19-3-2141;
(b)on July 1, 2009, continuing until the additional employer contributions terminate pursuant to 19-3-316(4)(b), the percentage specified in subsection (3) of this section of compensation must be allocated to the defined benefit plan to eliminate the plan choice rate unfunded actuarial liability;
(c)on July 1, 2013, and continuing until June 30, 2015, an amount equal to 1% of compensation must be allocated to the defined benefit plan unfunded liabilities; and
(d)on July 1, 2015, and continuing until the plan choice rate unfunded actuarial liability in the defined benefit plan is fully paid, an amount equal to 1% of compensation must be allocated to the defined benefit plan as part of the plan choice rate. Effective the first full pay period in the month following the board’s verification that the plan choice rate unfunded actuarial liability is paid off, the amount equal to 1% of compensation must be allocated to the member’s retirement account until the additional employer contributions terminate pursuant to 19-3-316(4)(b).
(3)The percentage of compensation to be contributed under subsection (2)(b) is 0.27% for fiscal year 2014 and increases by 0.1% each fiscal year through fiscal year 2024. For fiscal years beginning after June 30, 2024, the percentage of compensation to be contributed under subsection (2)(b) is 1.27%.
(4)Effective the first full pay period in the month following the board’s verification that the plan choice rate unfunded actuarial liability is paid off, the 2.37% of compensation in subsection (2)(a)(ii) and the percentage of compensation in subsection (3), if any, must be allocated to the member’s retirement account.
(5)Forfeitures of employer contributions and investment income on the employer contributions may not be used to increase a member’s retirement account. The board shall allocate the forfeitures under 19-3-2116 to meet the plan’s administrative expenses, including startup expenses.