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LEGISLATURE OF NEBRASKA
ONE HUNDRED NINTH LEGISLATURE
SECOND SESSION
LEGISLATIVE BILL 1166
Introduced by Juarez, 5; Ballard, 21; Lonowski, 33; Murman, 38; Rountree,
3.
Read first time January 21, 2026
Committee: Nebraska Retirement Systems
A BILL FOR AN ACT relating to the School Employees Retirement Act; to1
amend section 79-958, Revised Statutes Supplement, 2025; to change2
applicability of the employee contribution rate as prescribed; to3
repeal the original sections; and to declare an emergency.4
Be it enacted by the people of the State of Nebraska,5
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Section 1. Section 79-958, Revised Statutes Supplement, 2025, is1
amended to read: 2
79-958 (1)(a) Beginning on September 1, 2012, and prior to July 1,3
2025, for the purpose of providing the funds to pay for formula4
annuities, every employee shall be required to deposit in the School5
Retirement Fund nine and seventy-eight hundredths of one percent of6
compensation. 7
(b) Beginning in 2025 and each year thereafter, the employee8
contribution rate shall be calculated as of July 1 and based on the9
funded ratio of the actuarial value of assets in the School Retirement10
Fund in the most recent previous year as reported in the annual actuarial11
valuation report for the retirement system prepared for the retirement12
board pursuant to section 84-1503. 13
(c)(i) The employee contribution rate that is calculated as of July14
1, 2025, shall apply beginning July 1, 2025, and prior to July 1, 2026.15
(ii) The employee contribution rate that is calculated as of July 1,16
2026, shall apply beginning July 1, 2026, and prior to September 1, 2027.17
(iii) Beginning in 2027 and each year thereafter, the employee18
contribution rate that is calculated as of July 1 of such year shall19
apply beginning September 1 of such year and prior to September 1 of the20
next year after such year. 21
(d) Beginning on July 1, 2025, for the purpose of providing the22
funds to pay for formula annuities, every employee shall deposit the23
following amounts into the School Retirement Fund:24
(i) If the funded ratio on the actuarial value of assets in the25
School Retirement Fund is less than ninety-six percent, nine and three-26
quarters of one percent of compensation; 27
(ii) If the funded ratio on the actuarial value of assets in the28
School Retirement Fund is ninety-six percent or greater and less than29
ninety-eight percent, eight and three-quarters of one percent of30
compensation; 31
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(iii) If the funded ratio on the actuarial value of assets in the1
School Retirement Fund is ninety-eight percent or greater and less than2
one hundred percent, eight percent of compensation; and3
(iv) If the funded ratio on the actuarial value of assets in the4
School Retirement Fund is one hundred percent or greater, seven and one-5
quarter of one percent of compensation. 6
(e) (c) Deposits under this subsection shall be transmitted at the7
same time and in the same manner as required employer contributions.8
(2) For the purpose of providing the funds to pay for formula9
annuities, every employer shall be required to deposit in the School10
Retirement Fund one hundred one percent of the required contributions of11
the school employees of each employer. Such deposits shall be transmitted12
to the retirement board at the same time and in the same manner as such13
required employee contributions. 14
(3) The employer shall pick up the member contributions required by15
this section for all compensation paid on or after January 1, 1986, and16
the contributions so picked up shall be treated as employer contributions17
pursuant to section 414(h)(2) of the Internal Revenue Code in determining18
federal tax treatment under the code and shall not be included as gross19
income of the member until such time as they are distributed or made20
available. The contributions, although designated as member21
contributions, shall be paid by the employer in lieu of member22
contributions. The employer shall pay these member contributions from the23
same source of funds which is used in paying earnings to the member. The24
employer shall pick up these contributions by a compensation deduction25
through a reduction in the cash compensation of the member. Member26
contributions picked up shall be treated for all purposes of the School27
Employees Retirement Act in the same manner and to the same extent as28
member contributions made prior to the date picked up.29
(4) The employer shall pick up the member contributions made through30
irrevocable payroll deduction authorizations pursuant to sections 79-92131
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and 79-933.03 to 79-933.06, and the contributions so picked up shall be1
treated as employer contributions in the same manner as contributions2
picked up under subsection (3) of this section. 3
Sec. 2. Original section 79-958, Revised Statutes Supplement, 2025,4
is repealed. 5
Sec. 3. Since an emergency exists, this act takes effect when6
passed and approved according to law. 7
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