SCS/HCS/HB 356 - This act modifies provisions of MOSERS retirement law, with the main changes being to the survivor options and Cost-of-Living Adjustments (COLAs).

SURVIVOR OPTION. This act modifies option 2 ("Joint and 50%") and option 1 ("Joint and 100%") by eliminating the option 2 reduction and decreasing the option 1 reduction by the same amount. Currently the unreduced survivor option applies to Department of Conservation retirees, but not general MOSERS members. This act would apply both options 1 and 2 to both general MOSERS and Conservation.

Option 2. This act modifies the "Joint and 50%" survivor option (spouse gets 50% of what the member is eligible to receive) by allowing this option to be taken unreduced. Under this option, the member would be eligible for 100% of the benefit with a 50% survivor option for the spouse. In addition, the member would receive a lump sum payment for the difference in the reduction and the full benefit.

Option 1. This act also modifies the "Joint and 100%" survivor option (spouse gets 100% of what the member is eligible to receive) by allowing this option to be taken with a reduction which is set-off in part by the difference in the actuarial reductions between options 1 and 2. Currently there is roughly a 13% reduction in the member s retirement benefit (member generally gets about 87% of their benefit). Under this option, the "Joint and 100%" reduction will be decreased by roughly 7%, with the member generally eligible for about 94% of the benefit and the surviving spouse would receive the same benefit upon the member s death. In addition, the member also would receive a lump sum payment for the difference in reductions.

These survivor option modifications only apply to members who retired after October 1, 1984.

COST-OF-LIVING ADJUSTMENTS (COLAs). Currently, all members (MOSERS and Highway) receive a COLA based on 80% of the Consumer Price Index (CPI), with a minimum COLA of 4%, maximum 5%, until they reach 65% of their initial benefit. This act modifies the COLA in three levels--retired, current employees and new employees. Those already retired and having reached the 65% cap before 10/1/96, will receive a new COLA (80% of CPI, maximum 5%) beginning 9/1/97. Retirees who reach the cap after 10/1/96 will receive the new COLA beginning on their anniversary date. Current employees will receive the existing COLA until the 65% cap is reached and then will begin receiving the new COLA. Newly hired employees will receive the new COLA.

JUDICIAL RETIREMENT. This act also establishes actuarial funding of the Judicial Retirement System, effective 7/1/98.

KILLER OF SPOUSE. This act also prohibits a spouse convicted of killing a member from receiving benefits.

HEALTH BENEFITS. Members on long-term disability will receive a subsidy towards health care under the Missouri Consolidated Health Care Plan.

SPECIAL CONSULTANTS. This act adds a number of special consultant provisions to implement the survivor option and COLA changes, and to other retirement provisions already being applied, but missing that language.

This act also makes numerous other technical changes, including modifications of military service references in accordance with federal law, and changing unemancipated minor provisions to "under 21".
MARGARET J. TOALSON