AB 324

For individuals who first become participating employees in the Wisconsin

Retirement System on or after the effective date of this bill, this bill increases the

minimum retirement age for general participants from age 55 to age 60 and for

protective occupation participants from age 50 to age 52. The bill does not change

the minimum retirement age for an individual who was a participating employee in

the WRS before the effective date of the bill.

For individuals who first become participating employees in the WRS on or

after the effective date of this bill, this bill modifies the formula method for

calculating a participant's retirement annuity by calculating the participant's final

average earning using the participant's five highest annual earning periods rather

than three highest annual earning periods. Under current law, when a WRS

participant terminates covered employment and becomes eligible for an annuity, the

Department of Employee Trust Funds calculates the participant's annuity amount

using two methods and pays the participant an annuity using whichever method

results in a higher amount. The first method, known as the formula method, is based

on the participant's final average earnings, the participant's number of years of

creditable service, and a percentage multiplier. Under current law, a participant's

final average earnings is a monthly rate of earnings calculated based on the three

annual earnings periods in which the participant's earnings were highest. The

second method is to calculate the amount of a money purchase annuity, which is

determined based on the sum of a participant's accumulated required and additional

contributions plus an amount that equals the participant's accumulated required

contributions. This bill does not change the formula method for calculating a

participant's annuity if the participant was a participating employee in the WRS

before the effective date of the bill.

Because this bill relates to public employee retirement or pensions, it may be

referred to the Joint Survey Committee on Retirement Systems for a report to be

printed as an appendix to the bill.