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A4054
ASSEMBLY, No. 4054
STATE OF NEW JERSEY
222nd LEGISLATURE
�
INTRODUCED FEBRUARY 12, 2026
Sponsored by:
Assemblywoman� VERLINA REYNOLDS-JACKSON
District 15 (Hunterdon and Mercer)
Assemblyman� ANTHONY S. VERRELLI
District 15 (Hunterdon and Mercer)
Assemblywoman� LINDA S. CARTER
District 22 (Somerset and Union)
SYNOPSIS
���� Requires transfer of certain participants of DCRP to
PERS.
CURRENT VERSION OF TEXT
���� As introduced.
��
An Act
concerning the transfer of certain participants from the Defined Contribution
Retirement Program to the Public Employees� Retirement System and supplementing
P.L.1954, c.84 (C.43:15A-1 et seq.).
����
Be It Enacted
by the Senate and General Assembly of the State of New Jersey:
���� 1.� a.� Notwithstanding the
provisions of any other law, rule, or regulation to the contrary, all employees
of school districts or boards of education hired on or after the effective date
of P.L.��� , c.���� (C.������� ) (pending before the Legislature as this bill)
who earn more than the minimum salary requirements for members eligible to
enroll on or after November 2, 2008, and on or before May 21, 2010, and would
otherwise be eligible for enrollment in the Public Employees� Retirement System
but for the fact that such employees do not meet the minimum work hours
eligibility requirements, pursuant to P.L.1954, c.84 (C.43:15A-1 et seq.), but
who work more than 20 hours per week, shall be enrolled as members of the
Public Employees� Retirement System and shall be entitled to and shall receive
the same benefits received by members of the retirement system who enrolled in
the system after July 1, 2011.�
���� b.� Public school employees
who are enrolled as participants of the Defined Contribution Retirement Program
established pursuant to P.L.2007, c.92 (C.43:15C-1 et seq.) on the effective
date of P.L. , c.��� (C.������ ) (pending before the
Legislature as this bill), shall be enrolled in the Public Employee�s
Retirement System pursuant to the provisions of subsection a. of this section
within 180 days following that effective date.� Each employee shall be given
service credit in the Public Employees� Retirement System for service starting
on the employee�s date of enrollment in the Defined Contribution Retirement
Program.�
���� Service credit transferred
from a participant of the Defined Contribution Retirement Program under this
subsection shall be recognized as service credit to determine eligibility for
deferred retirement, early retirement, service retirement, disability retirement,
veteran�s retirement, health benefits enumerated under the School Employees�
Health Benefits Program, and other benefits as determined to be appropriate by
the Division of Pensions and Benefits; provided, however, that any years of
service credit transferred to the Public Employees� Retirement System from the
Defined Contribution Retirement Program pursuant to this subsection shall not
be used to calculate the amount of the pension benefits the member would
receive in retirement as set forth by P.L.1954, c.84 (C.43:15A-1 et seq.).
���� The actuary for the Public
Employees' Retirement System shall determine the unfunded accrued liability
resulting from the transfer and coverage of employees under this subsection in
the same manner provided for the determination of the unfunded accrued liability
of the retirement system by section 24 of P.L.1954, c.84 (C.43:15A-24).� The
unfunded accrued liability shall be amortized in the manner provided by section
24 over an amortization period of 20 years. The State shall be responsible for
the one-time payment to fund the unfunded liability, which would be the difference
between the value of the funds transferred from the Defined Contribution
Retirement Program and the actuarially determined unfunded liability of the
Public Employees� Retirement System resulting from the provisions of this
section.
���� c.� The value of the account
of an employee who is transferred out of the program shall be transferred from
the
Defined Contribution Retirement Program
to
the Public Employees� Retirement System
in accordance
with the relevant provisions of the federal Internal Revenue Code and Internal
Revenue Service guidance as a direct trustee-to-trustee transfer.� The transfer
shall be in accordance with a rule, method, or process that shall not result in
the transfer being deemed a distribution includible in federal gross income for
the employee. �If it is determined that the funds currently in the Defined
Contribution Retirement Program held by an employee moving to the Public
Employees' Retirement System can be moved to the Public Employees' Retirement
System fund, then the employee moving to the Public Employees' Retirement
System shall receive full service credit upon enrollment in the Public
Employees' Retirement System for the time the employee accrued in the Defined
Contribution Retirement Program.� If, however, it is determined that the
Defined Contribution Retirement Program funds cannot be moved to the Public
Employees' Retirement System in order to provide the employee full service
credit, then the employee moving to the Public Employees' Retirement System shall
not receive full service credit for the purposes of the base pension credit.
���� 2. This act shall take effect
immediately.
STATEMENT
����� This bill requires the transfer of certain
participants of the Defined Contribution Retirement Program (DCRP) to the
Public Employees� Retirement System (PERS).
����� Under the bill, employees of school districts or
boards of education who are hired on or after the effective date of this bill
and earn more than the minimum salary requirement for members eligible to
enroll on or after November 2, 2008, and on or before May 21, 2010, and would
otherwise be eligible for enrollment in the Public Employees� Retirement System
but for the fact that such employees do not meet the minimum work hours
eligibility requirements, but who work more than 20 hours per week, will be enrolled
as members of the PERS.� Those employees will be entitled to and will receive
the same benefits received by members of the retirement system who enrolled in
the system after July 1, 2011.
����� Any affected employees who are currently enrolled as
participants of the DCRP will be transferred to the PERS within 180 days of the
bill�s effective date.�
����� Upon the transfer, each employee will be given
service credit in the PERS for service starting on the employee�s date of
enrollment in the DCRP.
����� Any years of service credit transferred to the PERS
from the DCRP will be used to qualify members for retirement and health
benefits associated with the PERS, but will not be used to calculate the amount
of pension benefit.
����� Under the bill, the actuary for the PERS is required
to determine the unfunded accrued liability resulting from the transfer and
coverage of employees in the same manner provided under current law.�� The
State will be responsible for the one-time payment to fund the unfunded
liability resulting from the provisions of this bill.
����� Additionally, the value of the account of a
transferred employee is required to be transferred from the DCRP to the PERS in
accordance with the relevant provisions of the federal Internal Revenue Code
and Internal Revenue Service guidance as a direct trustee-to-trustee transfer.�
����� If it is determined that the funds currently in the
DCRP held by those employees moving to the PERS can be moved to the PERS fund,
then the employees moving to the PERS will receive full service credit upon
enrollment in the PERS for the time they accrued in the DCRP.� If, however, it
is determined that the DCRP funds cannot be moved to the PERS in order to
provide the employees with full service credit, then those employees moving to
the PERS will not receive full service credit for the purposes of the base
pension credit.