This bill proposes changes to the calculation of state retirement annuities for Group I members (employee or teacher retirees) in New Hampshire. The key change is that the reduction of a retiree's annuity will now be applied at the member's full retirement age under the federal Social Security system instead of at age 65. The bill amends RSA 100-A:5, I(b), RSA 100-A:6, I(b)(1)(A) and (B), and RSA 100-A:6, I(d)(1)(A) and (B) to reflect this change. The language "age 65" is deleted and replaced with "the member’s full retirement age for Social Security" in the relevant sections of the law. This adjustment will affect the state annuity calculations both before and after the member reaches the new specified age.

The fiscal note attached to the bill indicates that there will be no fiscal impact in FY 2024-2025 since contribution rates for that period have already been certified and are not subject to change. However, there is an expected increase in expenditures of $1,410,000 for the state and $5,740,000 for political subdivisions in FY 2026. The New Hampshire Retirement System (NHRS) projects an increase in the actuarial accrued liability by $45 million due to the provisions in the bill, which will be amortized over a period of no longer than 20 years. The NHRS also notes that there will be indeterminable administrative costs associated with reprogramming the pension administration system to accommodate these changes. The act is set to take effect 60 days after its passage.

Statutes affected:
Introduced: 100-A:5, 100-A:6