Montana Code 19-5-404. State employer contribution — definitions
19-5-404. State employer contribution — definitions. (1) (a) Beginning July 1, 2023, the state shall pay as employer contributions an actuarially determined employer contribution that is determined annually by the public employees’ retirement board’s actuary in accordance with the provisions of this section and part of the plan’s annual actuarial valuation. This actuarially determined employer contribution is effective July 1 following the annual actuarial valuation completed in the prior calendar year.
Terms Used In Montana Code 19-5-404
- Amortization: Paying off a loan by regular installments.
- 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.
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
(b)The actuarially determined employer contribution must be the sum of the following contribution rates minus the employee contribution provided for in 19-5-402:
(i)the contribution rate determined under subsection (1)(c) to pay for the contemporary unfunded liability; and
(ii)the contribution rate determined under subsection (1)(d) to pay for the normal cost of benefits as they accrue.
(c)The contribution rate under subsection (1)(b)(i) for the contemporary unfunded liability must be the amount required on a level percentage basis to pay the annual contemporary unfunded liabilities attributable to the employer’s employees over a layered amortization schedule so that each fiscal year‘s contemporary unfunded liability is amortized over a closed 10-year period, starting with the contemporary unfunded liability for the fiscal year ending June 30, 2024.
(d)The contribution rate under subsection (1)(b)(ii) for the normal cost of benefits as they accrue must be the amount required on a level percentage basis to pay the normal cost of benefits as determined in the annual actuarial valuation as the benefits accrue for each of the employer’s employees.
(2)(a) Beginning July 1, 2024, the state shall contribute monthly from the natural resources operations special state revenue account, established in 15-38-301, to the judges’ pension trust fund an actuarially determined employer contribution that is determined annually by the public employees’ retirement board’s actuary in accordance with the provisions of this section and part of the plan’s annual actuarial valuation for the chief water court judge. This actuarially determined employer contribution is effective July 1 following the annual actuarial valuation completed in the prior calendar year.
(b)The actuarially determined employer contribution must be the sum of the following contribution rates minus the employee contribution provided in 19-5-402:
(i)the contribution rate determined under subsection (2)(c) to pay for the contemporary unfunded liability; and
(ii)the contribution rate determined under subsection (2)(d) to pay for the normal cost of benefits as they accrue.
(c)The contribution rate under subsection (2)(b)(i) for the contemporary unfunded liability must be the amount required on a level percentage basis to pay the annual contemporary unfunded liabilities attributable to the employer’s employees over a layered amortization schedule so that each fiscal year’s contemporary unfunded liability is amortized over a closed 10-year period, starting with the contemporary unfunded liability for the fiscal year ending June 30, 2024.
(d)The contribution rate under subsection (2)(b)(ii) for the normal cost of benefits as they accrue must be the amount required on a level percentage basis to pay the normal cost of benefits as determined in the annual actuarial valuation as the benefits accrue for each of the employer’s employees.
(3)For the purposes of this section, the following definitions apply:
(a)”Contemporary unfunded liability” means the plan’s annual fiscal year actuarial gains and losses smoothed over 5 years starting with the fiscal year ending June 30, 2019.
(b)”Legacy unfunded liability” means the unfunded liability of the plan as of June 30, 2023.