ORS 238.730: Unfunded Actuarial Liability Resolution Program.

(1) The Public Employees Retirement Board shall establish an Unfunded Actuarial Liability Resolution Program. Under the program, the board shall provide technical expertise to manage projected employer contribution rate changes. Funding plans developed under the program must be based on actuarial reports prepared under ORS 238.605. (2) A participating public employer shall participate in the program. (3) The board may use moneys in the Employer Incentive Fund established in section 1, chapter 105, Oregon Laws 2018, for reasonable administrative costs incurred under this section. [2018 c.105 §26; 2019 c.355 §54; 2021 c.135 §7] 238.730. (1) The Public Employees Retirement Board shall establish an Unfunded Actuarial Liability Resolution Program. Under the program, the board shall provide technical expertise to manage projected employer contribution rate changes. Funding plans developed under the program must be based on actuarial reports prepared under ORS 238.605. (2) A participating public employer shall participate in the program. (Employer Incentive Fund) Sec. 1. (1) The Employer Incentive Fund is established in the State Treasury, separate and distinct from the General Fund. Interest earned by the Employer Incentive Fund shall be credited to the fund. Interest earned by the fund may be used under section 2, chapter 105, Oregon Laws 2018, to match lump sum payments made under ORS 238.229. (2) Moneys in the fund are continuously appropriated to the Public Employees Retirement Board for the purposes described in sections 2 and 26 [238.730], chapter 105, Oregon Laws 2018. (3) Moneys in the fund shall be invested in the Oregon Short Term Fund established under ORS 293.728. [2018 c.105 §1; 2019 c.355 §46] Sec. 2. (1)(a) The Public Employees Retirement Board shall establish a process for distributing the moneys in the Employer Incentive Fund established under section 1, chapter 105, Oregon Laws 2018. (b) The process must allow a participating public employer to apply to reserve matching amounts in the Employer Incentive Fund by committing to make a qualifying lump sum payment of at least $25,000 to an account established under ORS 238.229. (2) The board shall adopt rules establishing: (a) The percentage of a lump sum payment that may be matched by distributions from the fund, not to exceed 25 percent of a qualifying lump sum payment. (b) The maximum matching amount that may be reserved by a participating public employer, not to exceed the greater of: (A) Five percent of the unfunded actuarial liability attributable to the employer, as determined in the most recent report prepared under ORS 238.605; or (B) $300,000. (c) The qualifications for lump sum payments that may be matched under this section, including a requirement that a qualifying lump sum payment may not be a payment from moneys borrowed by the employer. (d) A requirement that the participating public employer participate in the Unfunded Actuarial Liability Resolution Program to develop a plan under ORS 238.730. (3)(a) For 90 days after the board begins accepting applications under subsection (1) of this section, a participating public employer may apply to reserve matching amounts from the Employer Incentive Fund under subsection (1) of this section only if the unfunded actuarial liability attributable to the employer, as determined in the most recent report prepared under ORS 238.605, is more than 200 percent of the employer’s payroll for members of the Public Employees Retirement System. (b) After the 90-day period described in paragraph (a) of this subsection, any participating public employer may apply to reserve matching funds from the Employer Incentive Fund under subsection (1) of this section. (4)(a) The board shall approve applications that meet the qualifications established under subsection (2) of this section in the order in which the applications are submitted. The board shall continue approving applications as long as adequate moneys in the Employer Incentive Fund are available. (b) After all of the moneys available in the Employer Incentive Fund are reserved for matching under paragraph (a) of this subsection, the board may establish a waiting list for the remaining timely submitted applications and, if sufficient moneys in the Employer Incentive Fund become available, shall approve, in the order in which the applications were submitted, applications that meet the qualifications established under subsection (2) of this section. (5) The board shall transfer matching amounts approved under subsection (4) of this section from the Employer Incentive Fund to the approved employers’ accounts established under ORS 238.229. (6) The board may transfer moneys from the Employer Incentive Fund to the Public Employees Retirement Fund established under ORS 238.660 for crediting to the reserves for pension accounts and annuities as provided in ORS 238.670 (2). (7) The board may use moneys in the Employer Incentive Fund for reasonable administrative costs incurred under this section. [2018 c.105 §2; 2019 c.355 §47; 2021 c.135 §9] Sec. 3. (1) Section 2, chapter 105, Oregon Laws 2018, as amended by section 47, chapter 355, Oregon Laws 2019, is repealed July 1, 2042. (2)(a) The Employer Incentive Fund established under section 1, chapter 105, Oregon Laws 2018, is abolished on July 1, 2042. (b) The unexpended moneys remaining in the Employer Incentive Fund on July 1, 2042, shall be transferred to the General Fund. [2018 c.105 §3; 2019 c.355 §48; 2020 s.s.2 c.10 §16] (School Districts Unfunded Liability Fund) Sec. 24. (1) The School Districts Unfunded Liability Fund is established in the State Treasury, separate and distinct from the General Fund. Interest earned by the School Districts Unfunded Liability Fund shall be credited to the fund. The fund consists of moneys transferred, allocated or appropriated to the fund. (2) Moneys in the fund are continuously appropriated to the Public Employees Retirement Board for the purpose of reducing the liabilities of participating public employers, as defined in ORS 238.005, that are school districts. (3) Moneys in the fund shall be invested in the Oregon Short Term Fund established under ORS 293.728. (4)(a) No later than June 30, 2025, the board shall apply all moneys in the fund on February 28, 2025, in equal amounts against all school district employers’ individual 2025-2027 employer contribution rates. (b) The board shall apply any moneys that are credited to the fund after February 28, 2025, in equal amounts against all school district employers’ individual employer contribution rates for the biennium following the crediting. (5) No later than February 1 of each odd-numbered year, the board shall report to the Oregon Department of Administrative Services and the Legislative Fiscal Officer an estimate of how moneys will be distributed under this section in the following biennium. [2018 c.105 §24; 2019 c.355 §51; 2020 s.s.2 c.10 §19; 2025 c.18 §1] Sec. 52. The School Districts Unfunded Liability Fund established under section 24, chapter 105, Oregon Laws 2018, is abolished on July 1, 2042. The unexpended moneys remaining in the fund on July 1, 2042, shall be transferred to the General Fund. [2019 c.355 §52] (Reports to Joint Committee on Ways and Means) Sec. 27. Section 28 of this 2018 Act is added to and made a part of ORS chapter 238. [2018 c.105 §27] Sec. 28. During each regular session of the Legislative Assembly, the Public Employees Retirement Board shall report to the Joint Committee on Ways and Means on the status of the Employer Incentive Fund established in section 1 of this 2018 Act, the School Districts Unfunded Liability Fund established in section 24 of this 2018 Act and the Unfunded Actuarial Liability Resolution Program established under section 26 of this 2018 Act [238.730]. [2018 c.105 §28] Sec. 29. Section 28, chapter 105, Oregon Laws 2018, is repealed on January 2, 2042. [2018 c.105 §29; 2019 c.355 §53] SHORT TITLE