Bill 734

                    Current Status

Bill Number:               734
Ratification Number:       458
Act Number                 372
Introducing Body:          Senate
Subject:                   Relating to the South Carolina Retirement
                           System, the South Carolina Police Officers
                           Retirement system and the retirement system
                           for teachers and employees of technical
                           training schools

(A372, R458, S734)

AN ACT TO AMEND SECTIONS 9-11-210, 9-1-1020, BOTH AS AMENDED, AND 9-1-1180, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO MONTHLY PAYMENTS OF EMPLOYEE AND EMPLOYER CONTRIBUTIONS TO THE SOUTH CAROLINA RETIREMENT SYSTEM, THE SOUTH CAROLINA POLICE OFFICERS RETIREMENT SYSTEM AND THE RETIREMENT SYSTEM FOR TEACHERS AND EMPLOYEES OF TECHNICAL TRAINING SCHOOLS, SO AS TO DISALLOW CONTRIBUTIONS FOR UNUSED SICK LEAVE AND OTHER SINGLE SPECIAL PAYMENTS AT RETIREMENT.

Be it enacted by the General Assembly of the State of South Carolina:

Employee annuity savings fund

Section 1. Section 9-1-1020 of the 1976 Code, as last amended by an act of 1982 bearing Ratification Number 426, is further amended by adding at the end:

"Payments for unused sick leave and other single special payments at retirement, except up to forty-five days' pay for unused annual leave, shall not be compensation for which contributions are deductible."

The section when amended shall read:

"Section 9-1-1020. The employee annuity savings fund shall be the account in which shall be recorded the contributions deducted from the earnable compensation of members to provide for their employee annuities. Each employer shall cause to be deducted from the compensation of each member on each and every payroll of such employer for each and every payroll period four percent of his earnable compensation. With respect to each member who is eligible for coverage under the Social Security Act in accordance with the agreement entered into during 1955 in accordance with the provisions of Chapter 7 of this Title; however, such deduction shall, commencing with the first day of the period of service with respect to which such agreement is effective, be at the rate of three percent of the part of his earnable compensation not in excess of four thousand eight hundred dollars, plus five percent of the part of his earnable compensation in excess of four thousand eight hundred dollars. In the case of any member so eligible and receiving compensation from two or more employers, such deductions may be adjusted under such rules as the Board may establish so as to be as nearly equivalent as practicable to the deductions which would have been made had the member received all of such compensation from one employer. In determining the amount earnable by a member in a payroll period, the Board may consider the rate of annual earnable compensation of such member on the first day of the payroll period as continuing throughout such payroll period and it may omit deduction from earnable compensation for any period less than a full payroll period if a teacher or employee was not a member on the first day of the payroll period.

Each employer shall certify to the Board on each and every payroll or in such other manner as the Board may prescribe the amounts to be deducted and such amounts shall be deducted and, when deducted, shall be credited to said employee annuity savings fund, to the individual accounts of the members from whose compensation the deductions were made.

Notwithstanding the foregoing, effective July 1, 1964, the rates of such deductions shall be, without regard to a member's coverage under the Social Security Act, as follows: 'In the case of Class One members, three percent of the portion of earnable compensation not in excess of four thousand eight hundred dollars, and five percent of the portion in excess of four thousand eight hundred dollars; and, in the case of Class Two members, four percent of the portion of earnable compensation not in excess of four thousand eight hundred dollars, and six percent of the portion in excess of four thousand eight hundred dollars.'

Each department and political subdivision shall pick up the employee contributions required by this section for all compensation paid on or after July 1, 1982, and the contributions so picked up shall be treated as employer contributions in determining federal tax treatment under the United States Internal Revenue Code; however, each department and political subdivision shall continue to withhold federal income taxes based upon these contributions until the Internal Revenue Service, or the federal courts, rule that, pursuant to Section 414(h) of the United States Internal Revenue Code, these contributions shall not be included as gross income of the employee until such time as they are distributed or made available. The department and political subdivision shall pay these employee contributions from the same source of funds which is used in paying earnings to the employee. The department and political subdivision may pick up these contributions by a reduction in the cash salary of the employee. Employee contributions picked up shall be treated for all purposes of this section in the same manner and to the extent as employee contributions made prior to the date picked up.

Payments for unused sick leave and other single special payments at retirement, except up to forty-five days' pay for unused annual leave, shall not be compensation for which contributions are deductible."

Deductions

Section 2. Section 9-1-1180 of the 1976 Code is amended by adding at the end:

"Payments for unused sick leave and other single special payments at retirement, except up to forty-five days' pay for unused annual leave, shall not be compensation for which contributions are deductible."

The section when amended shall read:

"Section 9-1-1180. The deductions authorized hereunder from the earnable compensation of teachers, the payments by employers of teachers of the required percentages of earnable compensation and all retirement allowances or other benefits herein provided shall be calculated upon the full earnable compensation of teachers from public funds derived from any source, and all employers' contributions for teachers shall be paid by the State. Provided, further, that all employers' contributions for employees of the various county technical training schools shall be paid by the State, effective July 1, 1962.

Payments for unused sick leave and other single special payments at retirement, except up to forty-five days' pay for unused annual leave, shall not be compensation for which contributions are deductible."

Payments for unused sick leave

Section 3. Section 9-11-210 of the 1976 Code, as last amended by an act of 1982 bearing Ratification Number 426, is further amended by adding at the end:

"(12) Payments for unused sick leave and other single special payments at retirement, except up to forty-five days' pay for unused annual leave, shall not be compensation for which contributions are deductible."

Time effective

Section 4. This act shall take effect upon the approval by the Governor.