Committee advances bill letting veterans buy up to 36 months of service credit toward state retirement

Senator Rhett presented Senate Bill 11 to the Senate retirement committee, saying the bill would permit certain veterans who are state employees to obtain month-for-month credible service of between one and 36 months toward their retirement if they meet specified conditions, and the committee voted to advance the measure by voice vote.

"This bill does is allows certain military members to attain credible service towards retirement benefits month for month up to 36 months," Senator Rhett told the committee, describing the bill's scope and typical use by employees near the end of their careers.

Under the language described in the hearing, eligible military service must have been active-duty service performed on or after Jan. 1, 1990, and veterans must have at least 10 years of membership service as a state employee to be eligible to buy the credit. Applicants must follow a method prescribed by the board of trustees, submit proof of qualifying active military service (the sponsor cited a DD Form 214 as an example), and pay an amount determined by the board equal to the "full actuarial cost" of the credited service. The sponsor said the cost is typically paid up front and that a payment plan option exists under the applicable code section.

Committee members sought definitions and limits: Senator Harbin and others asked whether the bill covers active duty only (the sponsor said "active duty, not guard, reserve, just active duty"), whether eligibility requires an honorable discharge (the sponsor said the DD214 indicating an honorable discharge would be required), and whether there is a minimum length of military service for eligibility (the sponsor said no minimum beyond the active-duty requirement, so one month of active-duty service could be credited if the veteran met other conditions).

Senator Walker clarified that the bill requires members to have at least 10 years of state membership service and asked about payment timing; committee discussion referred to existing payment provisions including an upfront payment within 90 days or the option of a payment plan in another code section. Senator Rhett said the provision is revenue-neutral and that the Office of Policy and Legislative Analysis supplied a fact sheet outlining implementation details.

Senator Rhett also told the committee this is a two-year bill that will require an actuarial study to determine the fiscal cost, and that the bill would move forward to a study and later consideration. A motion to pass and second were offered and the committee advanced the bill by unanimous voice vote.

The committee did not adopt further amendments at the hearing. The transcript records that the committee will obtain the actuarial study and additional fiscal information during the bill's study period prior to final action.