This bill establishes a new Group III defined contribution retirement plan for state employees who begin service on or after July 1, 2025. It amends existing law by modifying the introductory paragraph of RSA 100-A:3, I(a) to clarify that individuals who become employees after the establishment date will join the defined benefit retirement system, while those starting service on or after July 1, 2025, will participate in the new defined contribution plan. The bill introduces new legal language that defines the Group III plan, outlines membership requirements, and specifies contribution rates, with members contributing 7% of their earnable compensation and employers contributing at least 5%. It also allows for optional membership for certain positions, such as elected officials and unclassified employees, and establishes a commission to oversee the plan's administration and investment.

Additionally, the bill stipulates that all contributions and investment returns will be 100% vested upon contribution, and it outlines the conditions under which members can withdraw funds, including termination of employment, retirement, disability, and financial hardship. Initial funding for the plan will be covered by the state general fund until July 1, 2026, after which participants will bear the costs through assessments against their accounts. The effective date for the act is set for June 30, 2025, and it clarifies that employers will not be liable for investment losses resulting from participants directing their own investments. Overall, this legislation aims to modernize retirement benefits for new state employees while ensuring compliance with federal regulations.

Statutes affected:
Introduced: 100-A:16