A. Except as provided in Subsection D of this section, for a member whose annual salary is greater than twenty thousand dollars ($20,000), the member shall make contributions to the fund according to the following schedule:
(1) from July 1, 2013 through June 30, 2014, the member contribution rate shall be ten and one-tenth percent of the member’s annual salary; and
(2) on and after July 1, 2014, the member contribution rate shall be ten and seven-tenths percent of the member’s annual salary.
B. On and after July 1, 2008, for a member whose annual salary is twenty thousand dollars ($20,000) or less, the member contribution rate shall be seven and nine-tenths percent of the member’s annual salary.
C. Except as provided in Subsection D of this section, each local administrative unit shall make an annual contribution to the fund according to the following schedule:
(1) from July 1, 2013 through June 30, 2014, a sum equal to thirteen and fifteen-hundredths percent of the annual salary of each member employed by the local administrative unit; and
(2) on and after July 1, 2014, a sum equal to thirteen and nine-tenths percent of the annual salary of each member employed by the local administrative unit.
D. If, in a calendar year, the salary of a member, initially employed by a local administrative unit on or after July 1, 1996, equals the annual compensation limit set pursuant to Section 401(a)(17) of the Internal Revenue Code of 1986 [26 USCS § 401(a)(17)], as amended, then:
(1) for the remainder of that calendar year, no additional member contributions or local administrative unit contributions for that member shall be made pursuant to this section; provided that no member shall be denied service credit solely because contributions are not made by the member or on behalf of the member pursuant to the provisions of this subsection; and
(2) the amount of the annual compensation limit shall be divided into four equal portions, and, for purposes of attributing contributory employment and crediting service credit, each portion shall be attributable to one of the four quarters of the calendar year.
HISTORY:
1953 77-9-20, enacted by Laws 1967, ch. 16, § 144; 1974, ch. 5, § 1; 1981, ch. 293, § 1; 1984, ch. 19, § 2; 1991, ch. 140, § 1; 1992, ch. 117, § 1; 2005, ch. 273, § 1; 2008, ch. 68, § 1; 2009, ch. 127, § 11; 2010, ch. 67, § 1; 2011, ch. 178, § 13; 2013, ch. 61, § 1.
Amendment Notes.
The 2005 amendment, effective June 17, 2005, in Subsection A, substituted “according to the following schedule:” for “in the amount of seven and six-tenths percent of his annual salary”; added Paragraphs A(1) through (5); deleted former Subsection B and Subsection C, which pertained to local administrative yearly contributions of sums equal to 7.06 percent and 8.65 percent of the annual salary of each member employed by the unit, respectively; and added Subsection B.
The 2008 amendment, effective July 1, 2008, added the exception in the introductory paragraphs in Subsections A and B; and added Subsection C.
The 2009 amendment, effective July 1, 2009, added “except that, from July 1, 2009 through June 30, 2011, for members whose annual salary is greater than twenty thousand dollars ($20,000), the member contribution rate shall be nine and four-tenths percent of the member’s annual salary” in (A)(5); in (B)(6), substituted “ten and nine-tenths” for “twelve and four-tenths” and added “except that, for members whose annual salary is twenty thousand dollars ($20,000) or less, the local administrative unit shall contribute twelve and four-tenths percent of the member’s annual salary” at the end; and in (A)(7), substituted “eleven and sixty-five hundredths” for “thirteen and fifteen-hundredths” and added “except that, for members whose annual salary is twenty thousand dollars ($20,000) or less, the local administrative unit shall contribute thirteen and fifteen-hundredths percent of the member’s annual salary.”
The 2010 amendment, effective July 1, 2010, substituted “June 30, 2011” for “June 30, 2010” in (B)(6); in (B)(7), substituted “July 1, 2011 through June 30, 2012, a sum equal to thirteen and fifteen-hundredths percent” for “July 1, 2010 through June 30, 2011, a sum equal to eleven and sixty-five hundredths percent”, and deleted “except that, for members whose annual salary is twenty thousand dollars ($20,000) or less, the local administrative unit shall contribute thirteen and fifteen-hundredths percent of the member’s annual salary” following “local administrative unit”; and substituted “July 1, 2012” for “July 1, 2011” in (B)(8).
The 2011 amendment, effective July 1, 2011, deleted “from July 1, 2009 through June 30, 2011” following “except that” in the introductory language of (A)(5); added the (A)(5)(a) designation; added “from July 1, 2009 through June 30, 2011” in (A)(5)(a); and added (A)(5)(b) and (A)(5)(c); in (B)(7), substituted “nine and fifteen-hundredths percent” for “thirteen and fifteen-hundredths percent”; deleted former (B)(8), which read: “on and after July 1, 2012, a sum equal to thirteen and nine-tenths percent of the annual salary of each member employed by the local administrative unit”; added “except that for members . . . member’s annual salary” in (B)(7); added (B)(8) through (B)(10); and made a related change.
The 2013 amendment, effective July 1, 2013, rewrote the section.
Temporary provisions.
Laws 2008, ch. 68, § 3, effective July 1, 2008, provides that for each employee whose member contributions and local administrative unit contributions were incorrectly capped prior to July 1, 2008 because the employee’s salary exceeded the annual compensation limit set pursuant to Section 401(a)(17) of the Internal Revenue Code of 1986, as amended: A. the educational retirement board and the applicable local administrative unit shall jointly determine the amount of member contributions and local administrative unit contributions owed but not paid; B. the local administrative unit shall deposit into the educational retirement fund the total amount determined pursuant to Subsection A of this section; and C. upon the deposit pursuant to Subsection B of this section, the educational retirement board shall restore to the member all of the service credit otherwise earned by the member, but not previously credited because of the failure to make contributions, for service during the calendar years in which the contributions were incorrectly capped.
Laws 2011, 178 ch. § 14, effective July 1, 2011, provides “A. No later than September 30, 2013, the retirement board of the public employees retirement association and the educational retirement board shall each cause an actuarial study to be conducted for each retirement system administered by the board. Each study shall analyze whether the higher employee contribution rates and lower employer contribution rates required by this act and Laws 2009, Chapter 127 have had or will have an adverse actuarial effect on the retirement system in violation of Article 20, Section 22 of the constitution of New Mexico. The results of each study shall be submitted to the legislative finance committee and the governor. B. If a study concludes that a retirement system has had or will have an adverse actuarial effect as a result of the higher employee contribution rates and the lower employer contribution rates required by this act and Laws 2009, Chapter 127, the board that administers that retirement system shall submit a request for a supplemental appropriation to the second session of the fifty-first legislature in the amount that will rectify the adverse actuarial effect.”
Laws 2011, 178 ch. § 15, effective July 1, 2011, provides “For the purposes of calculating employee and employer contributions due after June 30, 2011, in determining whether an employee has an annual salary greater or less than twenty thousand dollars ($20,000), the employee’s annual salary shall be the employee’s base hourly rate at the time the contribution is made multiplied by the number of compensable hours for a full-time-equivalent in the employee’s position at the time the contribution is made as determined by the employer; provided that the department of finance and administration shall determine the number of compensable hours for a full-time-equivalent in the employee’s position for employees who are members in a retirement program provided for in the Public Employees Retirement Act, the Magistrate Retirement Act or the Judicial Retirement Act.”
Laws 2011, 178 ch. § 16, effective July 1, 2011, provides “Notwithstanding a provision of this act to the contrary, the employer and employee contribution rates required by this act for the period from July 1, 2011 through June 30, 2012 shall continue for the period from July 1, 2012 through June 30, 2013 if, after the last consensus revenue forecast before the beginning of the second session of the fiftieth legislature, the secretary of finance and administration certifies to the retirement board of the public employees retirement association, the educational retirement board and the legislative finance committee that, according to the consensus revenue forecast:
(1) general fund revenues in fiscal year 2012 will be less than one hundred million dollars ($100,000,000) more than the general fund revenue forecast reflected in the fiscal year 2012 state budget; and (2) at the end of fiscal year 2012, the total amount in the state reserve funds will be less than five percent of the total general fund appropriations for fiscal year 2012.”
Research References and Practice Aids
Cross references.
Member contributions; tax treatment, 22-11-21.1 NMSA 1978.
Return to employment; benefits continued; administrative unit contributions, 22-11-25.1 NMSA 1978.