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--- version:Introduced+++ version:(document, no version)@@ -1,3601 +1,14 @@-LEGISLATURE OF NEBRASKA-ONE HUNDRED NINTH LEGISLATURE-FIRST SESSION-LEGISLATIVE BILL 295+AMENDMENTS TO LB295-Introduced by Nebraska Retirement Systems Committee: Ballard, 21,-Chairperson; Clements, 2; Hardin, 48; Juarez, 5;-Sorrentino, 39.-Read first time January 15, 2025-Committee: Nebraska Retirement Systems-A BILL FOR AN ACT relating to relating to retirement; to amend sections1-23-2320, 42-1102, 79-902, 79-904.01, 79-915, 79-956, 79-978,2-79-9,103, 79-9,106, 79-9,117, 79-9,118, 81-2014, 81-2016, 81-2017,3-84-1301, 84-1307, 84-1322, 84-1502, 84-1504, and 84-1511, Reissue4-Revised Statutes of Nebraska, and sections 23-2301, 23-2306, 24-701,5-and 24-703.01, Revised Statutes Cumulative Supplement, 2024; to6-redefine terms and change provisions relating to termination,7-documents used to demonstrate United States citizenship or lawful8-presence in the United States, repayment of gross distributions or9-benefits, cost-of-living adjustments, deadlines for filing forms10-relating to survivorship annuities, and employee leave for11-preretirement planning programs under the County Employees12-Retirement Act, the Judges Retirement Act, the School Employees13-Retirement Act, the Class V School Employees Retirement Act, the14-Nebraska State Patrol Retirement Act, and the State Employees15-Retirement Act; to change a definition in the Spousal Pension Rights16-Act; to restate legislative intent under the Nebraska State Patrol17-Retirement Act; to change provisions relating to calling meetings of18-the Public Employees Retirement Board and paying per diems and19-expenses for members of the Public Employees Retirement Board; to20-change provisions relating to demonstrating United States21-citizenship or lawful presence in the United States for22+Introduced by Ballard, 21.+1. On page 37, line 5, strike "one hundred twenty", show as1+stricken, and insert " two hundred seventy". 2+2. On page 51, line 3, strike "creditable", show as stricken, and3+insert " membership". 4+AM18LB295-2025+MJP - 01/22/2025+AM18LB295-2025+MJP - 01/22/2025-1--participation in a deferred compensation plan; to harmonize1-provisions; and to repeal the original sections.2-Be it enacted by the people of the State of Nebraska,3-LB295-2025-LB295-2025--2--Section 1. Section 23-2301, Revised Statutes Cumulative Supplement,1-2024, is amended to read: 2-23-2301 For purposes of the County Employees Retirement Act, unless3-the context otherwise requires: 4-(1)(a) Actuarial equivalent means the equality in value of the5-aggregate amounts expected to be received under different forms of an6-annuity payment. 7-(b) For a member hired prior to January 1, 2018, the mortality8-assumption used for purposes of converting the member cash balance9-account shall be the 1994 Group Annuity Mortality Table using a unisex10-rate that is fifty percent male and fifty percent female. For purposes of11-converting the member cash balance account attributable to contributions12-made prior to January 1, 1984, that were transferred pursuant to the act,13-the 1994 Group Annuity Mortality Table for males shall be used.14-(c) For a member hired on or after January 1, 2018, or rehired on or15-after January 1, 2018, after termination of employment and being paid a16-retirement benefit or taking a refund of contributions, the mortality17-assumption used for purposes of converting the member cash balance18-account shall be a unisex mortality table that is recommended by the19-actuary and approved by the board following an actuarial experience20-study, a benefit adequacy study, or a plan valuation. The mortality table21-and actuarial factors in effect on the member's retirement date will be22-used to calculate the actuarial equivalency of any retirement benefit;23-(2) Annuity means equal monthly payments provided by the retirement24-system to a member or beneficiary under forms determined by the board25-beginning the first day of the month after an annuity election is26-received in the office of the Nebraska Public Employees Retirement27-Systems or the first day of the month after the employee's termination of28-employment, whichever is later. The last payment shall be at the end of29-the calendar month in which the member dies or in accordance with the30-payment option chosen by the member; 31-LB295-2025-LB295-2025--3--(3) Annuity start date means the date upon which a member's annuity1-is first effective and shall be the first day of the month following the2-member's termination or following the date the application is received by3-the board, whichever is later; 4-(4) Cash balance benefit means a member's retirement benefit that is5-equal to an amount based on annual employee contribution credits plus6-interest credits and, if vested, employer contribution credits plus7-interest credits and dividend amounts credited in accordance with8-subdivision (4)(c) of section 23-2317; 9-(5)(a) Compensation means gross wages or salaries payable to the10-member for personal services performed during the plan year. Compensation11-does not include insurance premiums converted into cash payments,12-reimbursement for expenses incurred, fringe benefits, per diems, or13-bonuses for services not actually rendered, including, but not limited14-to, early retirement inducements, cash awards, and severance pay, except15-for retroactive salary payments paid pursuant to court order,16-arbitration, or litigation and grievance settlements. Compensation17-includes overtime pay, member retirement contributions, and amounts18-contributed by the member to plans under sections 125, 403(b), and 457 of19-the Internal Revenue Code or any other section of the code which defers20-or excludes such amounts from income. 21-(b) Compensation in excess of the limitations set forth in section22-401(a)(17) of the Internal Revenue Code shall be disregarded. For an23-employee who was a member of the retirement system before the first plan24-year beginning after December 31, 1995, the limitation on compensation25-shall not be less than the amount which was allowed to be taken into26-account under the retirement system as in effect on July 1, 1993;27-(6) Date of adoption of the retirement system by each county means28-the first day of the month next following the date of approval of the29-retirement system by the county board or January 1, 1987, whichever is30-earlier; 31-LB295-2025-LB295-2025--4--(7) Date of disability means the date on which a member is1-determined by the board to be disabled; 2-(8) Defined contribution benefit means a member's retirement benefit3-from a money purchase plan in which member benefits equal annual4-contributions and earnings pursuant to section 23-2309 and, if vested,5-employer contributions and earnings pursuant to section 23-2310;6-(9) Disability means an inability to engage in any substantially7-gainful activity by reason of any medically determinable physical or8-mental impairment which was initially diagnosed or became disabling while9-the member was an active participant in the plan and which can be10-expected to result in death or be of a long-continued and indefinite11-duration; 12-(10) Employee means all persons or officers who are employed by a13-county of the State of Nebraska on a permanent basis, persons or officers14-employed by or serving in a municipal county formed by at least one15-county participating in the retirement system, persons employed as16-provided in section 2-1608, all elected officers of a county, and such17-other persons or officers as are classified from time to time as18-permanent employees by the county board of the county by which they are19-employed, except that employee does not include judges, employees or20-officers of any county having a population in excess of two hundred fifty21-thousand inhabitants as determined by the most recent federal decennial22-census, or, except as provided in section 23-2306, persons making23-contributions to the School Employees Retirement System of the State of24-Nebraska; 25-(11) Employee contribution credit means an amount equal to the26-member contribution amount required by section 23-2307;27-(12) Employer contribution credit means an amount equal to the28-employer contribution amount required by section 23-2308;29-(13) Final account value means the value of a member's account on30-the date the account is either distributed to the member or used to31-LB295-2025-LB295-2025--5--purchase an annuity from the plan, which date shall occur as soon as1-administratively practicable after receipt of a valid application for2-benefits, but no sooner than forty-five days after the member's3-termination; 4-(14) Five-year break in service means a period of five consecutive5-one-year breaks in service; 6-(15) Full-time employee means an employee who is employed to work7-one-half or more of the regularly scheduled hours during each pay period;8-(16) Future service means service following the date of adoption of9-the retirement system; 10-(17) Guaranteed investment contract means an investment contract or11-account offering a return of principal invested plus interest at a12-specified rate. For investments made after July 19, 1996, guaranteed13-investment contract does not include direct obligations of the United14-States or its instrumentalities, bonds, participation certificates or15-other obligations of the Federal National Mortgage Association, the16-Federal Home Loan Mortgage Corporation, or the Government National17-Mortgage Association, or collateralized mortgage obligations and other18-derivative securities. This subdivision shall not be construed to require19-the liquidation of investment contracts or accounts entered into prior to20-July 19, 1996; 21-(18) Hire date or date of hire means the first day of compensated22-service subject to retirement contributions; 23-(19) Interest credit rate means the greater of (a) five percent or24-(b) the applicable federal mid-term rate, as published by the Internal25-Revenue Service as of the first day of the calendar quarter for which26-interest credits are credited, plus one and one-half percent, such rate27-to be compounded annually; 28-(20) Interest credits means the amounts credited to the employee29-cash balance account and the employer cash balance account at the end of30-each day. Such interest credit for each account shall be determined by31-LB295-2025-LB295-2025--6--applying the daily portion of the interest credit rate to the account1-balance at the end of the previous day. Such interest credits shall2-continue to be credited to the employee cash balance account and the3-employer cash balance account after a member ceases to be an employee,4-except that no such credit shall be made with respect to the employee5-cash balance account and the employer cash balance account for any day6-beginning on or after the member's date of final account value. If7-benefits payable to the member's surviving spouse or beneficiary are8-delayed after the member's death, interest credits shall continue to be9-credited to the employee cash balance account and the employer cash10-balance account until such surviving spouse or beneficiary commences11-receipt of a distribution from the plan; 12-(21) Member cash balance account means an account equal to the sum13-of the employee cash balance account and, if vested, the employer cash14-balance account and dividend amounts credited in accordance with15-subdivision (4)(c) of section 23-2317; 16-(22) One-year break in service means a plan year during which the17-member has not completed more than five hundred hours of service;18-(23) Participation means qualifying for and making the required19-deposits to the retirement system during the course of a plan year;20-(24) Part-time employee means an employee who is employed to work21-less than one-half of the regularly scheduled hours during each pay22-period; 23-(25) Plan year means the twelve-month period beginning on January 124-and ending on December 31; 25-(26) Prior service means service prior to the date of adoption of26-the retirement system; 27-(27) Regular interest means the rate of interest earned each28-calendar year as determined by the retirement board in conformity with29-actual and expected earnings on the investments through December 31,30-1985; 31-LB295-2025-LB295-2025--7--(28) Required beginning date means, for purposes of the deferral of1-distributions and the commencement of mandatory distributions pursuant to2-section 401(a)(9) of the Internal Revenue Code and the regulations issued3-thereunder, April 1 of the year following the calendar year in which a4-member: 5-(a)(i) Terminated employment with all employers participating in the6-plan; and 7-(ii)(A) Attained at least seventy and one-half years of age for a8-member who attained seventy and one-half years of age on or before9-December 31, 2019; 10-(B) Attained at least seventy-two years of age for a member who11-attained seventy and one-half years of age on or after January 1, 2020,12-and prior to January 1, 2023; 13-(C) Attained at least seventy-three years of age for a member who14-attained seventy-two years of age after December 31, 2022, and seventy-15-three years of age prior to January 1, 2033; or 16-(D) Attained at least seventy-five years of age for a member who17-attained seventy-four years of age after December 31, 2032; or18-(b)(i) Terminated employment with all employers participating in the19-plan; and 20-(ii) Otherwise reached the date specified by section 401(a)(9) of21-the Internal Revenue Code and the regulations issued thereunder;22-(29) Required contribution means the deduction to be made from the23-compensation of employees as provided in the act; 24-(30) Retirement means qualifying for and accepting the retirement25-benefit granted under the act after terminating employment;26-(31) Retirement application means the form approved and provided by27-the retirement system for acceptance of a member's request for either28-regular or disability retirement; 29-(32) Retirement board or board means the Public Employees Retirement30-Board; 31-LB295-2025-LB295-2025--8--(33) Retirement date means (a) the first day of the month following1-the date upon which a member's request for retirement is received on a2-retirement application if the member is eligible for retirement and has3-terminated employment or (b) the first day of the month following4-termination of employment if the member is eligible for retirement and5-has filed an application but has not yet terminated employment;6-(34) Retirement system means the Retirement System for Nebraska7-Counties; 8-(35) Service means the actual total length of employment as an9-employee and is not deemed to be interrupted by (a) temporary or seasonal10-suspension of service that does not terminate the employee's employment,11-(b) leave of absence authorized by the employer for a period not12-exceeding twelve months, (c) leave of absence because of disability, or13-(d) military service, when properly authorized by the retirement board.14-Service does not include any period of disability for which disability15-retirement benefits are received under section 23-2315;16-(36) Surviving spouse means (a) the spouse married to the member on17-the date of the member's death or (b) the spouse or former spouse of the18-member if survivorship rights are provided under a qualified domestic19-relations order filed with the board pursuant to the Spousal Pension20-Rights Act. The spouse or former spouse shall supersede the spouse21-married to the member on the date of the member's death as provided under22-a qualified domestic relations order. If the benefits payable to the23-spouse or former spouse under a qualified domestic relations order are24-less than the value of benefits entitled to the surviving spouse, the25-spouse married to the member on the date of the member's death shall be26-the surviving spouse for the balance of the benefits;27-(37)(a) (37) Termination of employment occurs on the date on which a28-county which is a member of the retirement system determines that its29-employer-employee relationship with an employee is dissolved. The county30-shall notify the board of the date on which such a termination has31-LB295-2025-LB295-2025--9--occurred. 1-(b) Termination of employment does not occur if an employee whose2-employer-employee relationship with a county is dissolved enters into an3-employer-employee relationship with the same or another county which4-participates in the Retirement System for Nebraska Counties and there are5-less than one hundred twenty days between the date when the employee's6-employer-employee relationship ceased with the county and the date when7-the employer-employee relationship commenced with the same or another8-county which qualifies the employee for participation in the plan.9-(c) It is the responsibility of the employer that is involved in the10-termination of employment to notify the board of such change in11-employment and provide the board with such information as the board deems12-necessary. 13-(d) If the board determines that termination of employment has not14-occurred and a retirement benefit has been paid to a member of the15-retirement system pursuant to section 23-2319, the board shall require16-the member who has received such benefit to repay the benefit to the17-retirement system unless the board determines that all or any portion of18-such benefit was the result of an inadvertent overpayment; and19-(38) Vesting credit means credit for years, or a fraction of a year,20-of participation in another Nebraska governmental plan for purposes of21-determining vesting of the employer account. 22-Sec. 2. Section 23-2306, Revised Statutes Cumulative Supplement,23-2024, is amended to read: 24-23-2306 (1) The membership of the retirement system shall be25-composed of all persons who are or were employed by member counties and26-who maintain an account balance with the retirement system.27-(2) The following employees of member counties are authorized to28-participate in the retirement system: (a) All permanent full-time29-employees who have attained the age of eighteen years shall begin30-participation in the retirement system upon employment and full-time31-LB295-2025-LB295-2025--10--elected officials shall begin participation in the retirement system upon1-taking office, (b) all permanent part-time employees who have attained2-the age of eighteen years may exercise the option to begin participation3-in the retirement system within the first thirty days of employment, and4-(c) all part-time elected officials may exercise the option to begin5-participation in the retirement system within thirty days after taking6-office. An employee who exercises the option to begin participation in7-the retirement system shall remain in the system until termination or8-retirement, regardless of any change of status as a permanent or9-temporary employee. 10-(3) No employee of a member county shall be authorized to11-participate in the retirement system provided for in the County Employees12-Retirement Act unless the employee is a United States citizen or is13-lawfully present in the United States. The employing member county and14-the employee shall maintain at least one of the following documents ,15-which shall be unexpired , if applicable to the particular document or16-which has an expiration date that has been extended by the United States17-Department of Homeland Security or the United States Citizenship and18-Immigration Services so that such document is still valid , to demonstrate19-United States citizenship or lawful presence in the United States as of20-the employee's date of hire and produce any such document so maintained21-upon request of the retirement board or the Nebraska Public Employees22-Retirement Systems: 23-(a) A state-issued driver's license; 24-(b) A state-issued identification card; 25-(c) A state-issued motor vehicle learner's permit;26-(d) (c) A certified copy of a birth certificate or delayed birth27-certificate issued in any state, territory, or possession of the United28-States; 29-(e) (d) A Consular Report of Birth Abroad issued by the United30-States Department of State; 31-LB295-2025-LB295-2025--11--(f) (e) A United States passport; 1-(g) (f) A foreign passport with a United States visa;2-(h) (g) A United States Certificate of Naturalization;3-(i) (h) A United States Certificate of Citizenship;4-(j) (i) A tribal certificate of Native American blood or similar5-document; 6-(k) (j) A United States Citizenship and Immigration Services7-Employment Authorization Document, Form I-766; 8-(l) (k) A United States Citizenship and Immigration Services9-Permanent Resident Card, Form I-551; or 10-(m) (l) Any other document issued by the United States Department of11-Homeland Security or the United States Citizenship and Immigration12-Services granting employment authorization in the United States and13-approved by the retirement board. 14-(4)(a) The board may determine that a governmental entity currently15-participating in the retirement system no longer qualifies, in whole or16-in part, under section 414(d) of the Internal Revenue Code as a17-participating employer in a governmental plan. 18-(b)(i) To aid governmental entities in their business decisionmaking19-process, any governmental entity currently participating in the20-retirement system contemplating a business transaction that may result in21-such entity no longer qualifying, in whole or in part, under section22-414(d) of the Internal Revenue Code may notify the board in writing as23-soon as reasonably practicable, but no later than one hundred eighty days24-before the transaction is to occur. 25-(ii) The board when timely notified shall, as soon as is reasonably26-practicable, obtain from its contracted actuary the cost of any actuarial27-study necessary to determine the potential funding obligation. The board28-shall notify the entity of such cost. 29-(iii) If such entity pays the board's contracted actuary pursuant to30-subdivision (4)(c)(vi) of this section for any actuarial study necessary31-LB295-2025-LB295-2025--12--to determine the potential funding obligation, the board shall, as soon1-as reasonably practicable following its receipt of the actuarial study,2-(A) determine whether the entity's contemplated business transaction will3-cause the entity to no longer qualify under section 414(d) of the4-Internal Revenue Code, (B) determine whether the contemplated business5-transaction constitutes a plan termination by the entity, (C) determine6-the potential funding obligation, (D) determine the administrative costs7-that will be incurred by the board or the Nebraska Public Employees8-Retirement Systems in connection with the entity's removal from the9-retirement system, and (E) notify the entity of such determinations.10-(iv) Failure to timely notify the board pursuant to subdivision (4)11-(b)(i) of this section may result in the entity being treated as though12-the board made a decision pursuant to subdivision (4)(a) of this section.13-(c) If the board makes a determination pursuant to subdivision (4)14-(a) of this section, or if the entity engages in the contemplated15-business transaction reviewed under subdivision (4)(b) of this section16-that results in the entity no longer qualifying under section 414(d) of17-the Internal Revenue Code: 18-(i) The board shall notify the entity that it no longer qualifies19-under section 414(d) of the Internal Revenue Code within ten business20-days after the determination; 21-(ii) The affected plan members shall be immediately considered fully22-vested; 23-(iii) The affected plan members shall become inactive within ninety24-days after the board's determination; 25-(iv) The entity shall pay to the County Employees Retirement Fund an26-amount equal to any funding obligation; 27-(v) The entity shall pay to the County Employees Cash Balance28-Retirement Expense Fund an amount equal to any administrative costs29-incurred by the board or the Nebraska Public Employees Retirement Systems30-in connection with the entity's removal from the retirement system; and31-LB295-2025-LB295-2025--13--(vi) The entity shall pay directly to the board's contracted actuary1-an amount equal to the cost of any actuarial study necessary to aid the2-board in determining the amount of such funding obligation, if not3-previously paid. 4-(d) For purposes of this subsection: 5-(i) Business transaction means a merger; consolidation; sale of6-assets, equipment, or facilities; termination of a division, department,7-section, or subgroup of the entity; or any other business transaction8-that results in termination of some or all of the entity's workforce; and9-(ii) Funding obligation means the financial liability of the10-retirement system to provide benefits for the affected plan members11-incurred by the retirement system due to the entity's business12-transaction calculated using the methodology and assumptions recommended13-by the board's contracted actuary and approved by the board. The14-methodology and assumptions used must be structured in a way that ensures15-the entity is financially liable for all the costs of the entity's16-business transaction, and the retirement system is not financially liable17-for any of the cost of the entity's business transaction.18-(e) The board may adopt and promulgate rules and regulations to19-carry out this subsection including, but not limited to, the methods of20-notifying the board of pending business transactions, the acceptable21-methods of payment, and the timing of such payment.22-(5) Within the first one hundred eighty days of employment, a full-23-time employee may apply to the board for vesting credit for years of24-participation in another Nebraska governmental plan, as defined by25-section 414(d) of the Internal Revenue Code. During the years of26-participation in the other Nebraska governmental plan, the employee must27-have been a full-time employee, as defined in the Nebraska governmental28-plan in which the credit was earned. The board may adopt and promulgate29-rules and regulations governing the assessment and granting of vesting30-credit. 31-LB295-2025-LB295-2025--14--(6) Any employee who qualifies for membership in the retirement1-system pursuant to this section may not be disqualified from membership2-in the retirement system solely because such employee also maintains3-separate employment which qualifies the employee for membership in4-another public retirement system, nor may membership in this retirement5-system disqualify such an employee from membership in another public6-retirement system solely by reason of separate employment which qualifies7-such employee for membership in this retirement system.8-(7) A full-time or part-time employee of a city, village, or9-township who becomes a county employee pursuant to a merger of services10-shall receive vesting credit for his or her years of participation in a11-Nebraska governmental plan, as defined by section 414(d) of the Internal12-Revenue Code, of the city, village, or township. 13-(8) A full-time or part-time employee of a city, village, fire14-protection district, or township who becomes a municipal county employee15-shall receive credit for his or her years of employment with the city,16-village, fire protection district, or township for purposes of the17-vesting provisions of this section. 18-(9) A full-time or part-time employee of the state who becomes a19-county employee pursuant to transfer of assessment function to a county20-shall not be deemed to have experienced a termination of employment and21-shall receive vesting credit for his or her years of participation in the22-State Employees Retirement System of the State of Nebraska.23-(10) Counties shall ensure that employees authorized to participate24-in the retirement system pursuant to this section shall enroll and make25-required contributions to the retirement system immediately upon becoming26-an employee. Information necessary to determine membership in the27-retirement system shall be provided by the employer.28-Sec. 3. Section 23-2320, Reissue Revised Statutes of Nebraska, is29-amended to read: 30-23-2320 (1) Prior to January 1, 2020, except as otherwise provided31-LB295-2025-LB295-2025--15--in this section, a member of the retirement system who has a five-year1-break in service shall upon reemployment be considered a new employee2-with respect to the County Employees Retirement Act and shall not receive3-credit for service prior to his or her reemployment date.4-(2)(a) A member who ceases to be an employee before becoming5-eligible for retirement under section 23-2315 and again becomes a6-permanent full-time or permanent part-time county employee prior to7-having a five-year break in service shall immediately be reenrolled in8-the retirement system and resume making contributions. For purposes of9-vesting employer contributions made prior to and after the reentry into10-the retirement system under subsection (3) of section 23-2319, years of11-participation include years of participation prior to such employee's12-original termination. For a member who is not vested and has received a13-termination benefit pursuant to section 23-2319, the years of14-participation prior to such employee's original termination shall be15-limited in a ratio equal to the amount that the member repays divided by16-the termination benefit withdrawn pursuant to section 23-2319.17-(b) The reemployed member may repay the value of, or a portion of18-the value of, the termination benefit withdrawn pursuant to section19-23-2319. A reemployed member who elects to repay all or a portion of the20-value of the termination benefit withdrawn pursuant to section 23-231921-shall repay the actual earnings on such value. Repayment of the22-termination benefit shall commence within three years of reemployment and23-shall be completed within five years of reemployment or prior to24-termination of employment, whichever occurs first, through (i) direct25-payments to the retirement system, (ii) installment payments made26-pursuant to a binding irrevocable payroll deduction authorization made by27-the member, (iii) an eligible rollover distribution as provided under the28-Internal Revenue Code, or (iv) a direct rollover distribution made in29-accordance with section 401(a)(31) of the Internal Revenue Code.30-(c) The value of the member's forfeited employer account or employer31-LB295-2025-LB295-2025--16--cash balance account, as of the date of forfeiture, shall be restored in1-a ratio equal to the amount of the benefit that the member has repaid2-divided by the termination benefit received. The employer account or3-employer cash balance account shall be restored first out of the current4-forfeiture amounts and then by additional employer contributions.5-(3) For a member who retired pursuant to section 23-2315 and becomes6-a permanent full-time employee or permanent part-time employee with a7-county under the County Employees Retirement Act more than one hundred8-twenty days after his or her retirement date, the member shall continue9-receiving retirement benefits. Such a retired member or a retired member10-who received a lump-sum distribution of his or her benefit shall be11-considered a new employee as of the date of reemployment and shall not12-receive credit for any service prior to the member's retirement for13-purposes of the act. 14-(4) A member who is reinstated as an employee pursuant to a15-grievance or appeal of his or her termination by the county shall be a16-member upon reemployment and shall not be considered to have a break in17-service for such period of time that the grievance or appeal was pending.18-(5) Beginning January 1, 2020, if a contributing member of the19-retirement system ceases to be an employee and returns to service in any20-capacity with any county under the County Employees Retirement Act prior21-to having a one-hundred-twenty-day break in service, the member:22-(a) Shall not be deemed to have had a bona fide separation of23-service; 24-(b) Shall be immediately reenrolled in: 25-(i) The defined contribution benefit if the member was contributing26-to the defined contribution benefit prior to ceasing employment; or27-(ii) The cash balance benefit in which the member was participating28-prior to ceasing employment if the member was contributing to the cash29-balance benefit prior to ceasing employment; 30-(c) Shall immediately resume making contributions;31-LB295-2025-LB295-2025--17--(d) Shall make up any missed contributions based upon services1-rendered and compensation received; 2-(e) Shall have all distributions from the retirement system3-canceled; and 4-(f) Shall repay the gross distributions from the retirement system5-unless the board determines that all or any portion of such gross6-distributions were the result of an inadvertent overpayment.7-(6)(a) Beginning January 1, 2020, if a contributing member of the8-retirement system ceases to be an employee and returns to permanent full-9-time or permanent part-time service in any capacity with any county under10-the County Employees Retirement Act after having a one-hundred-twenty-day11-break in service, the member: 12-(i) Shall be immediately reenrolled in: 13-(A) The defined contribution benefit if the member was contributing14-to the defined contribution benefit prior to ceasing employment; or15-(B) The cash balance benefit in which the member was participating16-prior to ceasing employment if the member was contributing to the cash17-balance benefit prior to ceasing employment; 18-(ii) Shall immediately resume making contributions;19-(iii) Shall continue receiving any annuity elected after the member20-ceased employment and before the member was reemployed; and21-(iv) Shall be prohibited from taking any distributions from the22-retirement system until the employee again terminates employment with any23-and all counties under the County Employees Retirement Act.24-(b) For the purposes of vesting employer contributions made prior to25-and after reentry into the retirement system, the member's years of26-participation prior to the date the member originally ceased employment27-and the years of participation after the member is reenrolled in the28-retirement system shall be included as years of participation, except29-that if the member is not vested on the date the member originally ceased30-employment and has taken a distribution, the years of participation prior31-LB295-2025-LB295-2025--18--to the date the member originally ceased employment shall be limited in a1-ratio equal to the value of the distribution that the member repays2-divided by the total value of the distribution taken as described in3-subdivision (6)(c) of this section. 4-(c) A reemployed member may repay all or a portion of the value of a5-distribution except for an annuity elected after the member ceased6-employment and before the member was reemployed. Repayment of such a7-distribution shall commence within three years after reemployment and8-shall be completed within five years after reemployment or prior to the9-member again ceasing employment, whichever occurs first, through (i)10-direct payments to the retirement system, (ii) installment payments made11-pursuant to a binding irrevocable payroll deduction authorization made by12-the member, (iii) an eligible rollover distribution as provided under the13-Internal Revenue Code, or (iv) a direct rollover distribution made in14-accordance with section 401(a)(31) of the Internal Revenue Code. If the15-member fails to repay all of the value of such a distribution prior to16-the member again ceasing employment, the member shall be forever barred17-from repaying the value of such a distribution taken between the periods18-of employment. The value of the member's forfeited employer account or19-employer cash balance account, as of the date of forfeiture, shall be20-restored in a ratio equal to the amount of the distribution repaid by the21-member divided by the amount of the distribution taken. The employer22-account or employer cash balance account shall be restored first out of23-the current forfeiture amounts and then by additional employer24-contributions. 25-Sec. 4. Section 24-701, Revised Statutes Cumulative Supplement,26-2024, is amended to read: 27-24-701 For purposes of the Judges Retirement Act, unless the context28-otherwise requires: 29-(1)(a) Actuarial equivalence means the equality in value of the30-aggregate amounts expected to be received under different forms of31-LB295-2025-LB295-2025--19--payment. 1-(b) For a judge hired prior to July 1, 2017, the determinations are2-to be based on the 1994 Group Annuity Mortality Table reflecting sex-3-distinct factors blended using seventy-five percent of the male table and4-twenty-five percent of the female table. An interest rate of eight5-percent per annum shall be reflected in making these determinations.6-(c) For a judge hired on or after July 1, 2017, or rehired on or7-after July 1, 2017, after termination of employment and being paid a8-retirement benefit, the determinations shall be based on a unisex9-mortality table and an interest rate specified by the board. Both the10-mortality table and the interest rate shall be recommended by the actuary11-and approved by the board following an actuarial experience study, a12-benefit adequacy study, or a plan valuation. The mortality table,13-interest rate, and actuarial factors in effect on the judge's retirement14-date will be used to calculate actuarial equivalency of any retirement15-benefit. Such interest rate may be, but is not required to be, equal to16-the assumed rate of return; 17-(2) Beneficiary means a person so designated by a judge in the last18-designation of beneficiary on file with the board or, if no designated19-person survives or if no designation is on file, the estate of such20-judge; 21-(3) Board means the Public Employees Retirement Board;22-(4)(a) Compensation means the statutory salary of a judge or the23-salary being received by such judge pursuant to law. Compensation does24-not include compensation for unused sick leave or unused vacation leave25-converted to cash payments, insurance premiums converted into cash26-payments, reimbursement for expenses incurred, fringe benefits, per27-diems, or bonuses for services not actually rendered, including, but not28-limited to, early retirement inducements, cash awards, and severance pay,29-except for retroactive salary payments paid pursuant to court order,30-arbitration, or litigation and grievance settlements. Compensation31-LB295-2025-LB295-2025--20--includes overtime pay, member retirement contributions, and amounts1-contributed by the member to plans under sections 125 and 457 of the2-Internal Revenue Code as defined in section 49-801.01 or any other3-section of the code which defers or excludes such amounts from income.4-(b) Compensation in excess of the limitations set forth in section5-401(a)(17) of the Internal Revenue Code as defined in section 49-801.016-shall be disregarded. For an employee who was a member of the retirement7-system before the first plan year beginning after December 31, 1995, the8-limitation on compensation shall not be less than the amount which was9-allowed to be taken into account under the retirement system as in effect10-on July 1, 1993; 11-(5) Creditable service means the total number of years served as a12-judge, including prior service, military service, and current service,13-computed to the nearest one-twelfth year. For current service prior to14-the time that the member has contributed the required percentage of15-salary until the maximum benefit as limited by section 24-710 has been16-earned, creditable service does not include current service for which17-member contributions are not made or are withdrawn and not repaid;18-(6) Current benefit means the initial benefit increased by all19-adjustments made pursuant to the Judges Retirement Act;20-(7)(a) Current service means the period of service (i) any judge of21-the Supreme Court or judge of the district court serves in such capacity22-from and after January 3, 1957, (ii)(A) any judge of the Nebraska23-Workmen's Compensation Court served in such capacity from and after24-September 20, 1957, and prior to July 17, 1986, and (B) any judge of the25-Nebraska Workers' Compensation Court serves in such capacity on and after26-July 17, 1986, (iii) any county judge serves in such capacity from and27-after January 5, 1961, (iv) any judge of a separate juvenile court serves28-in such capacity, (v) any judge of the municipal court served in such29-capacity subsequent to October 23, 1967, and prior to July 1, 1985, (vi)30-any judge of the county court or associate county judge serves in such31-LB295-2025-LB295-2025--21--capacity subsequent to January 4, 1973, (vii) any clerk magistrate, who1-was an associate county judge and a member of the fund at the time of2-appointment as a clerk magistrate, serves in such capacity from and after3-July 1, 1986, and (viii) any judge of the Court of Appeals serves in such4-capacity on or after September 6, 1991. 5-(b) Current service shall not be deemed to be interrupted by (i)6-temporary or seasonal suspension of service that does not terminate the7-employee's employment, (ii) leave of absence authorized by the employer8-for a period not exceeding twelve months, (iii) leave of absence because9-of disability, or (iv) military service, when properly authorized by the10-board. Current service does not include any period of disability for11-which disability retirement benefits are received under section 24-709;12-(8) Final average compensation for a judge who becomes a member13-prior to July 1, 2015, means the average monthly compensation for the14-three twelve-month periods of service as a judge in which compensation15-was the greatest or, in the event of a judge serving less than three16-twelve-month periods, the average monthly compensation for such judge's17-period of service. Final average compensation for a judge who becomes a18-member on and after July 1, 2015, means the average monthly compensation19-for the five twelve-month periods of service as a judge in which20-compensation was the greatest or, in the event of a judge serving less21-than five twelve-month periods, the average monthly compensation for such22-judge's period of service; 23-(9) Fund means the Nebraska Retirement Fund for Judges;24-(10) Future member means a judge who first served as a judge on or25-after December 25, 1969, or means a judge who first served as a judge26-prior to December 25, 1969, who elects to become a future member on or27-before June 30, 1970, as provided in section 24-710.01;28-(11) Hire date or date of hire means the first day of compensated29-service subject to retirement contributions; 30-(12) Initial benefit means the retirement benefit calculated at the31-LB295-2025-LB295-2025--22--time of retirement; 1-(13) Judge means and includes (a) all duly elected or appointed2-Chief Justices or judges of the Supreme Court and judges of the district3-courts of Nebraska who serve in such capacity on and after January 3,4-1957, (b)(i) all duly appointed judges of the Nebraska Workmen's5-Compensation Court who served in such capacity on and after September 20,6-1957, and prior to July 17, 1986, and (ii) judges of the Nebraska7-Workers' Compensation Court who serve in such capacity on and after July8-17, 1986, (c) judges of separate juvenile courts, (d) judges of the9-county courts of the respective counties who serve in such capacity on10-and after January 5, 1961, (e) judges of the county court and clerk11-magistrates who were associate county judges and members of the fund at12-the time of their appointment as clerk magistrates, (f) judges of13-municipal courts established by Chapter 26, article 1, who served in such14-capacity on and after October 23, 1967, and prior to July 1, 1985, and15-(g) judges of the Court of Appeals; 16-(14) Member means a judge eligible to participate in the retirement17-system established under the Judges Retirement Act;18-(15) Normal form annuity means a series of equal monthly payments19-payable at the end of each calendar month during the life of a retired20-judge as provided in sections 24-707 and 24-710, except as provided in21-section 42-1107. The first payment shall include all amounts accrued22-since the effective date of the award of the annuity. The last payment23-shall be at the end of the calendar month in which such judge dies. If at24-the time of death the amount of annuity payments such judge has received25-is less than contributions to the fund made by such judge, plus regular26-interest, the difference shall be paid to the beneficiary or estate;27-(16) Normal retirement date means the first day of the month28-following attainment of age sixty-five; 29-(17) Original member means a judge who first served as a judge prior30-to December 25, 1969, who does not elect to become a future member31-LB295-2025-LB295-2025--23--pursuant to section 24-710.01, and who was retired on or before December1-31, 1992; 2-(18) Plan year means the twelve-month period beginning on July 1 and3-ending on June 30 of the following year; 4-(19) Prior service means all the periods of time any person has5-served as a (a) judge of the Supreme Court or judge of the district court6-prior to January 3, 1957, (b) judge of the county court prior to January7-5, 1961, (c) judge of the Nebraska Workmen's Compensation Court prior to8-September 20, 1957, (d) judge of the separate juvenile court, or (e)9-judge of the municipal court prior to October 23, 1967;10-(20) Regular interest means interest fixed at a rate equal to the11-daily treasury yield curve for one-year treasury securities, as published12-by the Secretary of the Treasury of the United States, that applies on13-July 1 of each year, which may be credited monthly, quarterly,14-semiannually, or annually as the board may direct;15-(21) Required beginning date means, for purposes of the deferral of16-distributions and the commencement of mandatory distributions pursuant to17-section 401(a)(9) of the Internal Revenue Code and the regulations issued18-thereunder, April 1 of the year following the calendar year in which a19-member: 20-(a)(i) Terminated employment with the State of Nebraska; and21-(ii)(A) Attained at least seventy and one-half years of age for a22-member who attained seventy and one-half years of age on or before23-December 31, 2019; 24-(B) Attained at least seventy-two years of age for a member who25-attained seventy and one-half years of age on or after January 1, 2020,26-and prior to January 1, 2023; 27-(C) Attained at least seventy-three years of age for a member who28-attained seventy-two years of age after December 31, 2022, and seventy-29-three years of age prior to January 1, 2033; or 30-(D) Attained at least seventy-five years of age for a member who31-LB295-2025-LB295-2025--24--attained seventy-four years of age after December 31, 2032; or1-(b)(i) Terminated employment with the State of Nebraska; and2-(ii) Otherwise reached the date specified by section 401(a)(9) of3-the Internal Revenue Code and the regulations issued thereunder;4-(22) Retirement application means the form approved and provided by5-the retirement system for acceptance of a member's request for either6-regular or disability retirement; 7-(23) Retirement date means (a) the first day of the month following8-the date upon which a member's request for retirement is received on a9-retirement application if the member is eligible for retirement and has10-terminated employment or (b) the first day of the month following11-termination of employment if the member is eligible for retirement and12-has filed an application but has not yet terminated employment;13-(24) Retirement system or system means the Nebraska Judges14-Retirement System as provided in the Judges Retirement Act;15-(25) Surviving spouse means (a) the spouse married to the member on16-the date of the member's death or (b) the spouse or former spouse of the17-member if survivorship rights are provided under a qualified domestic18-relations order filed with the board pursuant to the Spousal Pension19-Rights Act. The spouse or former spouse shall supersede the spouse20-married to the member on the date of the member's death as provided under21-a qualified domestic relations order. If the benefits payable to the22-spouse or former spouse under the qualified domestic relations order are23-less than the value of benefits entitled to the surviving spouse, the24-spouse married to the member on the date of the member's death shall be25-the surviving spouse for the balance of the benefits; and26-(26)(a) (26) Termination of employment occurs on the date on which27-the State Court Administrator's office determines that the judge's28-employer-employee relationship with the State of Nebraska is dissolved.29-The State Court Administrator's office shall notify the board of the date30-on which such a termination has occurred. 31-LB295-2025-LB295-2025--25--(b) Termination of employment does not include ceasing employment as1-a judge if the judge returns to regular employment as a judge or is2-employed on a regular basis by another agency of the State of Nebraska3-and there are less than one hundred twenty days between the date when the4-judge's employer-employee relationship ceased and the date when the5-employer-employee relationship recommences. 6-(c) It is the responsibility of the employer that is involved in the7-termination of employment to notify the board of such change in8-employment and provide the board with such information as the board deems9-necessary. 10-(d) If the board determines that termination of employment has not11-occurred and a retirement benefit has been paid to a member of the12-retirement system pursuant to section 24-710, the board shall require the13-member who has received such benefit to repay the benefit to the14-retirement system unless the board determines that all or any portion of15-such benefit was the result of an inadvertent overpayment.16-Sec. 5. Section 24-703.01, Revised Statutes Cumulative Supplement,17-2024, is amended to read: 18-24-703.01 No judge shall be authorized to participate in the19-retirement system provided for in the Judges Retirement Act unless the20-judge is a United States citizen or is lawfully present in the United21-States. The court and the judge shall maintain at least one of the22-following documents , which shall be unexpired , if applicable to the23-particular document or which has an expiration date that has been24-extended by the United States Department of Homeland Security or the25-United States Citizenship and Immigration Services so that such document26-is still valid, to demonstrate United States citizenship or lawful27-presence in the United States as of the judge's date of hire and produce28-any such document so maintained upon request of the board or the Nebraska29-Public Employees Retirement Systems: 30-(1) A state-issued driver's license; 31-LB295-2025-LB295-2025--26--(2) A state-issued identification card; 1-(3) A state-issued motor vehicle learner's permit;2-(4) (3) A certified copy of a birth certificate or delayed birth3-certificate issued in any state, territory, or possession of the United4-States; 5-(5) (4) A Consular Report of Birth Abroad issued by the United6-States Department of State; 7-(6) (5) A United States passport; 8-(7) (6) A foreign passport with a United States visa;9-(8) (7) A United States Certificate of Naturalization;10-(9) (8) A United States Certificate of Citizenship;11-(10) (9) A tribal certificate of Native American blood or similar12-document; 13-(11) (10) A United States Citizenship and Immigration Services14-Employment Authorization Document, Form I-766; 15-(12) (11) A United States Citizenship and Immigration Services16-Permanent Resident Card, Form I-551; or 17-(13) (12) Any other document issued by the United States Department18-of Homeland Security or the United States Citizenship and Immigration19-Services granting employment authorization in the United States and20-approved by the board. 21-Sec. 6. Section 42-1102, Reissue Revised Statutes of Nebraska, is22-amended to read: 23-42-1102 For purposes of the Spousal Pension Rights Act:24-(1) Alternate payee means a spouse, former spouse, child, or other25-dependent of a member who is recognized by a domestic relations order as26-having a right to receive all or a portion of the benefits payable by a27-statewide public retirement system with respect to such member;28-(2) Benefit means an annuity, a pension, a retirement allowance, a29-withdrawal of accumulated contributions, or an optional benefit accrued30-or accruing to a member under a statewide public retirement system;31-LB295-2025-LB295-2025--27--(3) Domestic relations order means a judgment, decree, or order,1-including approval of a property settlement agreement, which relates to2-the provision of child support, alimony payments, maintenance support, or3-marital property rights to a spouse, former spouse, child, or other4-dependent of a member and is made pursuant to a state domestic relations5-law of this state or another state; 6-(4) Earliest retirement date means the earlier of (a) the date on7-which the member is entitled to a distribution under the system or (b)8-the later of (i) the date that the member attains fifty years of age or9-(ii) the earliest date that the member could receive benefits under the10-system if the member separated from service; 11-(5) Qualified domestic relations order means a domestic relations12-order which creates or recognizes the existence of an alternate payee's13-right, or assigns to an alternate payee the right, to receive all or a14-portion of the benefits payable with respect to a member under a15-statewide public retirement system, which directs the system to disburse16-benefits to the alternate payee, and which meets the requirements of17-section 42-1103; 18-(6) Segregated amounts means the amounts which would have been19-payable to the alternative payee during the period of time that the20-qualified status of an order is being determined. Such amounts shall21-equal the amounts payable for such period if the order had been22-determined to be a qualified domestic relations order; and23-(7) Statewide public retirement system means the Retirement System24-for Nebraska Counties, the Nebraska Judges Retirement System as provided25-in the Judges Retirement Act, the School Employees Retirement System of26-the State of Nebraska, any Class V school employees retirement system,27-the Nebraska State Patrol Retirement System, and the State Employees28-Retirement System of the State of Nebraska. 29-Sec. 7. Section 79-902, Reissue Revised Statutes of Nebraska, is30-amended to read: 31-LB295-2025-LB295-2025--28--79-902 For purposes of the School Employees Retirement Act, unless1-the context otherwise requires: 2-(1) Accumulated contributions means the sum of all amounts deducted3-from the compensation of a member and credited to his or her individual4-account in the School Retirement Fund together with regular interest5-thereon, compounded monthly, quarterly, semiannually, or annually;6-(2)(a) Actuarial equivalent means the equality in value of the7-aggregate amounts expected to be received under different forms of8-payment. 9-(b) For a school employee hired before July 1, 2017, the10-determinations shall be based on the 1994 Group Annuity Mortality Table11-reflecting sex-distinct factors blended using twenty-five percent of the12-male table and seventy-five percent of the female table. An interest rate13-of eight percent per annum shall be reflected in making these14-determinations except when a lump-sum settlement is made to an estate.15-(c) For a school employee hired on or after July 1, 2017, or rehired16-on or after July 1, 2017, after termination of employment and being paid17-a retirement benefit or taking a refund of contributions, the18-determinations shall be based on a unisex mortality table and an interest19-rate specified by the board. Both the mortality table and the interest20-rate shall be recommended by the actuary and approved by the retirement21-board following an actuarial experience study, a benefit adequacy study,22-or a plan valuation. The mortality table, interest rate, and actuarial23-factors in effect on the school employee's retirement date will be used24-to calculate actuarial equivalency of any retirement benefit. Such25-interest rate may be, but is not required to be, equal to the assumed26-rate. 27-(d) If the lump-sum settlement is made to an estate, the interest28-rate will be determined by the AAA-rated segment of the Bloomberg29-Barclays Long U.S. Corporate Bond Index as of the prior June 30, rounded30-to the next lower quarter percent. If the AAA-rated segment of the31-LB295-2025-LB295-2025--29--Bloomberg Barclays Long U.S. Corporate Bond Index is discontinued or1-replaced, a substitute index shall be selected by the board which shall2-be a reasonably representative index; 3-(3) Beneficiary means any person in receipt of a school retirement4-allowance or other benefit provided by the act; 5-(4)(a) Compensation means gross wages or salaries payable to the6-member for personal services performed during the plan year and includes7-(i) overtime pay, (ii) member retirement contributions, (iii) retroactive8-salary payments paid pursuant to court order, arbitration, or litigation9-and grievance settlements, and (iv) amounts contributed by the member to10-plans under sections 125, 403(b), and 457 of the Internal Revenue Code as11-defined in section 49-801.01 or any other section of the code which12-defers or excludes such amounts from income , and (v) leave of absence13-pay. 14-(b) Compensation does not include (i) fraudulently obtained amounts15-as determined by the retirement board, (ii) amounts for accrued unused16-sick leave or accrued unused vacation leave converted to cash payments,17-(iii) insurance premiums converted into cash payments, (iv) reimbursement18-for expenses incurred, (v) fringe benefits, (vi) per diems paid as19-expenses, (vii) bonuses for services not actually rendered, (viii) early20-retirement inducements, (ix) cash awards, (x) severance pay, or (xi)21-employer contributions made for the purposes of separation payments made22-at retirement. 23-(c) Compensation in excess of the limitations set forth in section24-401(a)(17) of the Internal Revenue Code as defined in section 49-801.0125-shall be disregarded. For an employee who was a member of the retirement26-system before the first plan year beginning after December 31, 1995, the27-limitation on compensation shall not be less than the amount which was28-allowed to be taken into account under the retirement system as in effect29-on July 1, 1993; 30-(5) County school official means (a) until July 1, 2000, the county31-LB295-2025-LB295-2025--30--superintendent or district superintendent and any person serving in his1-or her office who is required by law to have a teacher's certificate and2-(b) on or after July 1, 2000, the county superintendent, county school3-administrator, or district superintendent and any person serving in his4-or her office who is required by law to have a teacher's certificate;5-(6)(a) Creditable service means prior service for which credit is6-granted under sections 79-926 to 79-929, service credit purchased under7-sections 79-933.03 to 79-933.06 and 79-933.08, and all service rendered8-while a contributing member of the retirement system; and9-(b) Creditable service includes working days, sick days, vacation10-days, holidays, and any other leave days for which the employee is paid11-regular wages as part of the employee's agreement with the employer.12-Creditable service does not include lump-sum payments to the employee13-upon termination or retirement in lieu of accrued benefits for such days,14-eligibility and vesting credit, service years for which member15-contributions are withdrawn and not repaid by the member, service16-rendered for which the retirement board determines that the member was17-paid less in compensation than the minimum wage as provided in the Wage18-and Hour Act, service which the board determines was rendered with the19-intent to defraud the retirement system, or service provided to an20-employer in a retirement system established pursuant to the Class V21-School Employees Retirement Act; 22-(7) Current benefit means the initial benefit increased by all23-adjustments made pursuant to the School Employees Retirement Act;24-(8) Disability means an inability to engage in any substantially25-gainful activity by reason of any medically determinable physical or26-mental impairment which was initially diagnosed or became disabling while27-the member was an active participant in the plan and which can be28-expected to result in death or be of a long-continued and indefinite29-duration; 30-(9) Disability retirement allowance means the annuity paid to a31-LB295-2025-LB295-2025--31--person upon retirement for disability under section 79-952;1-(10) Disability retirement date means the first day of the month2-following the date upon which a member's request for disability3-retirement is received on a retirement application provided by the4-retirement system if the member has terminated employment in the school5-system and has complied with sections 79-951 to 79-954 as such sections6-refer to disability retirement; 7-(11) Early retirement inducement means, but is not limited to:8-(a) A benefit, bonus, or payment to a member in exchange for an9-agreement by the member to terminate from employment;10-(b) A benefit, bonus, or payment paid to a member in addition to the11-member's retirement benefit; 12-(c) Lump-sum or installment cash payments, except payments for13-accrued unused leave converted to cash payments; 14-(d) An additional salary or wage component of any kind that is being15-paid as an incentive to leave employment and not for personal services16-performed for which creditable service is granted;17-(e) Partial or full employer payment of a member's health, dental,18-life, or long-term disability insurance benefits or cash in lieu of such19-insurance benefits that extend beyond the member's termination of20-employment and contract of employment dates. This subdivision does not21-apply to any period during which the member is contributing to the22-retirement system and being awarded creditable service; and23-(f) Any other form of separation payments made by an employer to a24-member at termination, including, but not limited to, purchasing25-retirement annuity contracts for the member pursuant to section 79-514,26-depositing money for the member in an account established under section27-403(b) of the Internal Revenue Code except for payments for accrued28-unused leave, or purchasing service credit for the member pursuant to29-section 79-933.08; 30-(12) Eligibility and vesting credit means credit for years, or a31-LB295-2025-LB295-2025--32--fraction of a year, of participation in a Nebraska government plan for1-purposes of determining eligibility for benefits under the School2-Employees Retirement Act. Such credit shall not be included as years of3-creditable service in the benefit calculation; 4-(13) Emeritus member means a person (a) who has entered retirement5-under the act, including those persons who have retired since July 1,6-1945, under any other regularly established retirement or pension system7-as contemplated by section 79-916, (b) who has thereafter been reemployed8-in any capacity by a public school, a Class V school district, or a9-school under the control and management of the Board of Trustees of the10-Nebraska State Colleges, the Board of Regents of the University of11-Nebraska, or a community college board of governors or has become a state12-school official or county school official subsequent to such retirement,13-and (c) who has applied to the board for emeritus membership in the14-retirement system. The school district or agency shall certify to the15-retirement board on forms prescribed by the retirement board that the16-annuitant was reemployed, rendered a service, and was paid by the17-district or agency for such services; 18-(14) Employer means the State of Nebraska or any subdivision thereof19-or agency of the state or subdivision authorized by law to hire school20-employees or to pay their compensation; 21-(15)(a) Final average compensation means: 22-(i) Except as provided in subdivision (ii) of this subdivision:23-(A) The sum of the member's total compensation during the three24-twelve-month periods of service as a school employee in which such25-compensation was the greatest divided by thirty-six; or26-(B) If a member has such compensation for less than thirty-six27-months, the sum of the member's total compensation in all months divided28-by the total number of months of his or her creditable service therefor;29-and 30-(ii) For an employee who became a member on or after July 1, 2013:31-LB295-2025-LB295-2025--33--(A) The sum of the member's total compensation during the five1-twelve-month periods of service as a school employee in which such2-compensation was the greatest divided by sixty; or 3-(B) If a member has such compensation for less than sixty months,4-the sum of the member's total compensation in all months divided by the5-total number of months of his or her creditable service therefor.6-(b) Payments under the Retirement Incentive Plan pursuant to section7-79-855 and Staff Development Assistance pursuant to section 79-856 shall8-not be included in the determination of final average compensation;9-(16) Fiscal year means any year beginning July 1 and ending June 3010-next following; 11-(17) Hire date or date of hire means the first day of compensated12-service subject to retirement contributions; 13-(18) Initial benefit means the retirement benefit calculated at the14-time of retirement; 15-(19) Member means any person who has an account in the School16-Retirement Fund; 17-(20) Participation means qualifying for and making required deposits18-to the retirement system during the course of a plan year;19-(21) Plan year means the twelve-month period beginning on July 1 and20-ending on June 30 of the following year; 21-(22) Prior service means service rendered as a school employee in22-the public schools of the State of Nebraska prior to July 1, 1945;23-(23) Public school means any and all schools offering instruction in24-elementary or high school grades, as defined in section 79-101, which25-schools are supported by public funds and are wholly under the control26-and management of the State of Nebraska or any subdivision thereof,27-including (a) schools or other entities established, maintained, and28-controlled by the school boards of local school districts, except Class V29-school districts, (b) any educational service unit, and (c) any other30-educational institution wholly supported by public funds, except schools31-LB295-2025-LB295-2025--34--under the control and management of the Board of Trustees of the Nebraska1-State Colleges, the Board of Regents of the University of Nebraska, or2-the community college boards of governors for any community college3-areas; 4-(24) Regular employee means an employee hired by a public school or5-under contract in a regular full-time or part-time position who works a6-full-time or part-time schedule on an ongoing basis for twenty or more7-hours per week. An employee hired as described in this subdivision to8-provide service for less than twenty hours per week but who provides9-service for an average of twenty hours or more per week in each calendar10-month of any three calendar months of a plan year shall, beginning with11-the next full payroll period, commence contributions and shall be deemed12-a regular employee for all future employment with the same employer . The13-twenty-hour-per-week threshold shall be calculated by dividing the total14-number of hours of service provided for the same employer in a calendar15-month by the total number of calendar days in the month, and multiplying16-such number by seven; 17-(25) Regular interest means interest fixed at a rate equal to the18-daily treasury yield curve for one-year treasury securities, as published19-by the Secretary of the Treasury of the United States, that applies on20-July 1 of each year, which may be credited monthly, quarterly,21-semiannually, or annually as the board may direct;22-(26) Relinquished creditable service means, with respect to a member23-who has withdrawn his or her accumulated contributions under section24-79-955, the total amount of creditable service which such member has25-given up as a result of his or her election not to remain a member of the26-retirement system; 27-(27) Required beginning date means, for purposes of the deferral of28-distributions and the commencement of mandatory distributions pursuant to29-section 401(a)(9) of the Internal Revenue Code and the regulations issued30-thereunder, April 1 of the year following the calendar year in which a31-LB295-2025-LB295-2025--35--member: 1-(a)(i) Terminated employment with all employers participating in the2-plan; and 3-(ii)(A) Attained at least seventy and one-half years of age for a4-member who attained seventy and one-half years of age on or before5-December 31, 2019; 6-(B) Attained at least seventy-two years of age for a member who7-attained seventy and one-half years of age on or after January 1, 2020,8-and prior to January 1, 2023; 9-(C) Attained at least seventy-three years of age for a member who10-attained seventy-two years of age after December 31, 2022, and seventy-11-three years of age prior to January 1, 2033; or 12-(D) Attained at least seventy-five years of age for a member who13-attained seventy-four years of age after December 31, 2032; or14-(b)(i) Terminated employment with all employers participating in the15-plan; and 16-(ii) Otherwise reached the date specified by section 401(a)(9) of17-the Internal Revenue Code and the regulations issued thereunder;18-(28) Required deposit means the deduction from a member's19-compensation as provided for in section 79-958 which shall be deposited20-in the School Retirement Fund; 21-(29) Retirement means qualifying for and accepting a school or22-disability retirement allowance granted under the School Employees23-Retirement Act; 24-(30) Retirement application means the form approved and provided by25-the retirement system for acceptance of a member's request for either26-regular or disability retirement; 27-(31) Retirement board or board means the Public Employees Retirement28-Board; 29-(32) Retirement date means (a) if the member has terminated30-employment, the first day of the month following the date upon which a31-LB295-2025-LB295-2025--36--member's request for retirement is received on a retirement application1-provided by the retirement system or (b) if the member has filed a2-retirement application but has not yet terminated employment, the first3-day of the month following the date on which the member terminates4-employment. An application may be filed no more than one hundred twenty5-days prior to the effective date of the member's initial benefit;6-(33) Retirement system means the School Employees Retirement System7-of the State of Nebraska; 8-(34) Savings annuity means payments for life, made in equal monthly9-payments, derived from the accumulated contributions of a member;10-(35) School employee means a contributing member who earns service11-credit pursuant to section 79-927. For purposes of this section,12-contributing member means the following persons who receive compensation13-from a public school: (a) Regular employees; (b) regular employees having14-retired pursuant to the School Employees Retirement Act who subsequently15-provide compensated service on a regular basis in any capacity; and (c)16-regular employees hired by a public school on an ongoing basis to assume17-the duties of other regular employees who are temporarily absent.18-Substitute employees, temporary employees, and employees who have not19-attained the age of eighteen years shall not be considered school20-employees; 21-(36) School retirement allowance means the total of the savings22-annuity and the service annuity or formula annuity paid a person who has23-retired under sections 79-931 to 79-935. The monthly payments shall be24-payable at the end of each calendar month during the life of a retired25-member. The first payment shall include all amounts accrued since the26-effective date of the award of annuity. The last payment shall be at the27-end of the calendar month in which such member dies or in accordance with28-the payment option chosen by the member; 29-(37) School year means one fiscal year which includes not less than30-one thousand instructional hours or, in the case of service in the State31-LB295-2025-LB295-2025--37--of Nebraska prior to July 1, 1945, not less than seventy-five percent of1-the then legal school year; 2-(38) Service means employment as a school employee and shall not be3-deemed interrupted by (a) termination at the end of the school year of4-the contract of employment of an employee in a public school if the5-employee enters into a contract of employment in any public school,6-except a school in a Class V school district, for the following school7-year, (b) temporary or seasonal suspension of service that does not8-terminate the employee's employment, (c) leave of absence authorized by9-the employer for a period not exceeding twelve months, (d) leave of10-absence because of disability, or (e) military service when properly11-authorized by the retirement board. Service does not include any period12-of disability for which disability retirement benefits are received under13-sections 79-951 to 79-953; 14-(39) Service annuity means payments for life, made in equal monthly15-installments, derived from appropriations made by the State of Nebraska16-to the retirement system; 17-(40) State deposit means the deposit by the state in the retirement18-system on behalf of any member; 19-(41) State school official means the Commissioner of Education and20-his or her professional staff who are required by law or by the State21-Department of Education to hold a certificate as such term is defined in22-section 79-807; 23-(42) Substitute employee means a person hired by a public school as24-a temporary employee to assume the duties of regular employees due to a25-temporary absence of any regular employees. Substitute employee does not26-mean a person hired as a regular employee on an ongoing basis to assume27-the duties of other regular employees who are temporarily absent;28-(43) Surviving spouse means (a) the spouse married to the member on29-the date of the member's death or (b) the spouse or former spouse of the30-member if survivorship rights are provided under a qualified domestic31-LB295-2025-LB295-2025--38--relations order filed with the board pursuant to the Spousal Pension1-Rights Act. The spouse or former spouse shall supersede the spouse2-married to the member on the date of the member's death as provided under3-a qualified domestic relations order. If the benefits payable to the4-spouse or former spouse under a qualified domestic relations order are5-less than the value of benefits entitled to the surviving spouse, the6-spouse married to the member on the date of the member's death shall be7-the surviving spouse for the balance of the benefits;8-(44) Temporary employee means an employee hired by a public school9-who is not a regular employee and who is hired to provide service for a10-limited period of time to accomplish a specific purpose or task. When11-such specific purpose or task is complete, the employment of such12-temporary employee shall terminate and in no case shall the temporary13-employment period exceed one year in duration; 14-(45)(a) Termination of employment or termination occurs on the date15-the member experiences a bona fide separation from service with the16-member's employer. The date of the separation is the end of the member's17-contractual agreement or, if there is no contract or only partial18-fulfillment of a contract, as determined by the employer.19-(b) A member shall not be deemed to have incurred a termination of20-employment if the board determines based on the facts and circumstances21-that: 22-(i) A claimed termination was not a bona fide separation from23-service with the member's employer; 24-(ii) A member was compensated for a full contractual period when the25-member stopped working prior to the end date of the contract; or26-(iii) A member prearranged a return to work that violates the27-provisions of the School Employees Retirement Act.28-(c) A member who experiences a separation from service must comply29-with the return-to-work provisions of section 79-930 if the member is30-subsequently employed by an employer participating in the retirement31-LB295-2025-LB295-2025--39--system. 1-(d) Nothing in this subdivision precludes an employer from adopting2-a policy which limits or denies employees who have experienced a3-separation from service with the employer from working as a volunteer or4-substitute employee within one hundred eighty days after the employee5-experiences such separation from service; and 6-(46) Voluntary service or volunteer means providing bona fide unpaid7-service to any employer. 8-Sec. 8. Section 79-904.01, Reissue Revised Statutes of Nebraska, is9-amended to read: 10-79-904.01 (1)(a) If the board determines that the retirement system11-has previously received contributions or distributed benefits which for12-any reason are not in accordance with the statutory provisions of the13-School Employees Retirement Act, the board may refund contributions,14-require additional contributions, adjust benefits, or require repayment15-of benefits paid. In the event of an overpayment of a benefit, the board16-may, in addition to other remedies, offset future benefit payments by the17-amount of the prior overpayment, together with regular interest thereon.18-In the event of a material underpayment of a benefit, the board shall19-immediately make payment equal to the deficit amount plus regular20-interest. 21-(b) The board shall have the power, through the director of the22-Nebraska Public Employees Retirement Systems or the director's designee,23-to make a thorough investigation of any overpayment of a benefit, when in24-the judgment of the retirement system such investigation is necessary,25-including, but not limited to, circumstances in which benefit payments26-are made after the death of a member or beneficiary and the retirement27-system is not made aware of such member's or beneficiary's death. In28-connection with any such investigation, the board, through the director29-or the director's designee, shall have the power to compel the attendance30-of witnesses and the production of books, papers, records, and documents,31-LB295-2025-LB295-2025--40--whether in hardcopy, electronic form, or otherwise, and issue subpoenas1-for such purposes. Such subpoenas shall be served in the same manner and2-have the same effect as subpoenas from district courts.3-(2) If the board determines that termination of employment has not4-occurred and a retirement benefit has been paid to a member of the5-retirement system pursuant to section 79-933, such member shall repay the6-benefit to the retirement system unless the board determines that all or7-any portion of such benefit was the result of an inadvertent overpayment.8-(3) The board may adopt and promulgate rules and regulations9-implementing this section, which shall include, but not be limited to,10-the following: (a) The procedures for refunding contributions, adjusting11-future contributions or benefit payments, and requiring additional12-contributions or repayment of benefits; (b) the process for a member,13-member's beneficiary, employee, or employer to dispute an adjustment of14-contributions or benefits; and (c) notice provided to all affected15-persons. All notices shall be sent at the time of or prior to an16-adjustment and shall describe the process for disputing an adjustment of17-contributions or benefits. 18-(4) The board shall not refund contributions made on compensation in19-excess of the limitations imposed by subdivision (4) of section 79-902 or20-subsection (9) of section 79-934. 21-Sec. 9. Section 79-915, Reissue Revised Statutes of Nebraska, is22-amended to read: 23-79-915 (1) Persons residing outside of the United States and engaged24-temporarily as school employees in the State of Nebraska shall not become25-members of the retirement system. 26-(2) No school employee shall be authorized to participate in the27-retirement system provided for in the School Employees Retirement Act28-unless the employee is a United States citizen or is lawfully present in29-the United States. The employing public school and the school employee30-shall maintain at least one of the following documents , which shall be31-LB295-2025-LB295-2025--41--unexpired , if applicable to the particular document or which has an1-expiration date that has been extended by the United States Department of2-Homeland Security or the United States Citizenship and Immigration3-Services so that such document is still valid, to demonstrate United4-States citizenship or lawful presence in the United States as of the5-employee's date of hire and produce any such document so maintained upon6-request of the retirement board or the Nebraska Public Employees7-Retirement Systems: 8-(a) A state-issued driver's license; 9-(b) A state-issued identification card; 10-(c) A state-issued motor vehicle learner's permit;11-(d) (c) A certified copy of a birth certificate or delayed birth12-certificate issued in any state, territory, or possession of the United13-States; 14-(e) (d) A Consular Report of Birth Abroad issued by the United15-States Department of State; 16-(f) (e) A United States passport; 17-(g) (f) A foreign passport with a United States visa;18-(h) (g) A United States Certificate of Naturalization;19-(i) (h) A United States Certificate of Citizenship;20-(j) (i) A tribal certificate of Native American blood or similar21-document; 22-(k) (j) A United States Citizenship and Immigration Services23-Employment Authorization Document, Form I-766; 24-(l) (k) A United States Citizenship and Immigration Services25-Permanent Resident Card, Form I-551; or 26-(m) (l) Any other document issued by the United States Department of27-Homeland Security or the United States Citizenship and Immigration28-Services granting employment authorization in the United States and29-approved by the retirement board. 30-(3)(a) The board may determine that a governmental entity currently31-LB295-2025-LB295-2025--42--participating in the retirement system no longer qualifies, in whole or1-in part, under section 414(d) of the Internal Revenue Code as a2-participating employer in a governmental plan. 3-(b)(i) To aid governmental entities in their business decisionmaking4-process, any governmental entity currently participating in the5-retirement system contemplating a business transaction that may result in6-such entity no longer qualifying, in whole or in part, under section7-414(d) of the Internal Revenue Code may notify the board in writing as8-soon as reasonably practicable, but no later than one hundred eighty days9-before the transaction is to occur. 10-(ii) The board when timely notified shall, as soon as is reasonably11-practicable, obtain from its contracted actuary the cost of any actuarial12-study necessary to determine the potential funding obligation. The board13-will notify the entity of such cost. 14-(iii) If such entity pays the board's contracted actuary pursuant to15-subdivision (3)(c)(vi) of this section for any actuarial study necessary16-to determine the potential funding obligation, the board shall, as soon17-as reasonably practicable following its receipt of the actuarial study,18-(A) determine whether the entity's contemplated business transaction will19-cause the entity to no longer qualify under section 414(d) of the20-Internal Revenue Code, (B) determine whether the contemplated business21-transaction constitutes a plan termination by the entity, (C) determine22-the potential funding obligation, (D) determine the administrative costs23-that will be incurred by the board or the Nebraska Public Employees24-Retirement Systems in connection with the entity's removal from the25-retirement system, and (E) notify the entity of such determinations.26-(iv) Failure to timely notify the board pursuant to subdivision (3)27-(b)(i) of this section may result in the entity being treated as though28-the board made a decision pursuant to subdivision (3)(a) of this section.29-(c) If the board makes a determination pursuant to subdivision (3)30-(a) of this section, or if the entity engages in the contemplated31-LB295-2025-LB295-2025--43--business transaction reviewed under subdivision (3)(b) of this section1-that results in the entity no longer qualifying under section 414(d) of2-the Internal Revenue Code: 3-(i) The board shall notify the entity that it no longer qualifies4-under section 414(d) of the Internal Revenue Code within ten business5-days after the determination; 6-(ii) The affected plan members shall be immediately considered fully7-vested; 8-(iii) The affected plan members shall become inactive within ninety9-days after the board's determination; 10-(iv) The entity shall pay to the School Retirement Fund an amount11-equal to any funding obligation; 12-(v) The entity shall pay to the Expense Fund an amount equal to any13-administrative costs incurred by the board or the Nebraska Public14-Employees Retirement Systems in connection with the entity's removal from15-the retirement system; and 16-(vi) The entity shall pay directly to the board's contracted actuary17-an amount equal to the cost of any actuarial study necessary to aid the18-board in determining the amount of such funding obligation, if not19-previously paid. 20-(d) For purposes of this subsection: 21-(i) Business transaction means a merger; consolidation; sale of22-assets, equipment, or facilities; termination of a division, department,23-section, or subgroup of the entity; or any other business transaction24-that results in termination of some or all of the entity's workforce; and25-(ii) Funding obligation means the financial liability of the26-retirement system to provide benefits for the affected plan members27-incurred by the retirement system due to the entity's business28-transaction calculated using the methodology and assumptions recommended29-by the board's contracted actuary and approved by the board. The30-methodology and assumptions used must be structured in a way that ensures31-LB295-2025-LB295-2025--44--the entity is financially liable for all the costs of the entity's1-business transaction, and the retirement system is not financially liable2-for any of the cost of the entity's business transaction.3-(e) The board may adopt and promulgate rules and regulations to4-carry out this subsection including, but not limited to, the methods of5-notifying the board of pending business transactions, the acceptable6-methods of payment, and the timing of such payment.7-Sec. 10. Section 79-956, Reissue Revised Statutes of Nebraska, is8-amended to read: 9-79-956 (1)(a) Except as provided in section 42-1107, if a member10-dies before the member's retirement date, the member's accumulated11-contributions shall be paid pursuant to section 79-969.12-(b) Except for payment to an alternative payee pursuant to a13-qualified domestic relations order, if no legal representative or14-beneficiary applies for such accumulated contributions, the contributions15-shall be distributed in accordance with the Uniform Disposition of16-Unclaimed Property Act. 17-(2) When the deceased member has twenty years or more of creditable18-service regardless of age or dies on or after his or her sixty-fifth19-birthday and leaves a surviving spouse who has been designated by the20-member as the sole surviving primary beneficiary, on forms provided by21-the board, as of the date of the member's death, such beneficiary may22-elect, within twelve months after the death of the member, to receive (a)23-a refund of the member's contribution account balance, including24-interest, plus an additional one hundred one percent of the member's25-contribution account balance, including interest, or (b) an annuity which26-shall be equal to the amount that would have accrued to the member had he27-or she elected to have the retirement annuity paid as a one-hundred-28-percent joint and survivor annuity payable as long as either the member29-or the member's spouse should survive and had the member retired (i) on30-the date of death if his or her age at death is sixty-five years or more31-LB295-2025-LB295-2025--45--or (ii) at age sixty-five years if his or her age at death is less than1-sixty-five years. 2-(3) When the deceased member who was a school employee on or after3-May 1, 2001, has not less than five years of creditable service and less4-than twenty years of creditable service and dies before his or her sixty-5-fifth birthday and leaves a surviving spouse who has been designated in6-writing as beneficiary and who, as of the date of the member's death, is7-the sole surviving primary beneficiary, such beneficiary may elect,8-within twelve months after the death of the member, to receive (a) a9-refund of the member's contribution account balance with interest plus an10-additional one hundred one percent of the member's contribution account11-balance with interest or (b) an annuity payable monthly for the surviving12-spouse's lifetime which shall be equal to the benefit amount that had13-accrued to the member at the date of the member's death, commencing when14-the member would have reached age sixty, or the member's age at death if15-greater, reduced by three percent for each year payments commence before16-the member would have reached age sixty-five, and adjusted for payment in17-the form of a one-hundred-percent joint and survivor annuity.18-(4)(a) If the requirements of subsection (2) or (3) of this section19-are not met, a lump sum equal to all contributions to the fund made by20-such member plus regular interest shall be paid pursuant to section21-79-969. Lump sum payments to multiple individuals made under this22-section, when appropriate, may be made independently of each other.23-(b) An application for benefits under subsection (2) or (3) of this24-section shall be deemed to have been timely filed if the application is25-received by the retirement system within twelve months after the date of26-the death of the member. 27-(5) Benefits to which a surviving spouse, beneficiary, or estate of28-a member shall be entitled pursuant to this section shall commence29-immediately upon the death of such member. 30-(6) A lump-sum death benefit paid to the member's beneficiary, other31-LB295-2025-LB295-2025--46--than the member's estate, that is an eligible distribution may be1-distributed in the form of a direct transfer to a retirement plan2-eligible to receive such transfer under the provisions of the Internal3-Revenue Code. 4-(7) For any member whose death occurs on or after January 1, 2007,5-while performing qualified military service as defined in section 414(u)6-of the Internal Revenue Code, the member's beneficiary shall be entitled7-to any additional death benefit that would have been provided, other than8-the accrual of any benefit relating to the period of qualified military9-service. The additional death benefit shall be determined as if the10-member had returned to employment with the employer and such employment11-had terminated on the date of the member's death. 12-Sec. 11. Section 79-978, Reissue Revised Statutes of Nebraska, is13-amended to read: 14-79-978 For purposes of the Class V School Employees Retirement Act,15-unless the context otherwise requires: 16-(1) Accumulated contributions means the sum of amounts contributed17-by a member of the system together with regular interest credited18-thereon; 19-(2) Actuarial equivalent means the equality in value of the20-retirement allowance for early retirement or the retirement allowance for21-an optional form of annuity, or both, with the normal form of the annuity22-to be paid, as determined by the application of the appropriate actuarial23-table, except that use of such actuarial tables shall not effect a24-reduction in benefits accrued prior to September 1, 1985, as determined25-by the actuarial tables in use prior to such date;26-(3) Actuarial tables means: 27-(a) For determining the actuarial equivalent of any annuities other28-than joint and survivorship annuities: 29-(i) For members hired before July 1, 2018, a unisex mortality table30-using twenty-five percent of the male mortality and seventy-five percent31-LB295-2025-LB295-2025--47--of the female mortality from the 1994 Group Annuity Mortality Table with1-a One Year Setback and using an interest rate of eight percent compounded2-annually; and 3-(ii) For members hired on or after July 1, 2018, or rehired on or4-after July 1, 2018, after termination of employment and being paid a5-retirement benefit, the determinations shall be based on a unisex6-mortality table and an interest rate specified by (A) the board until7-September 1, 2024, or (B) the retirement board beginning on September 1,8-2024. Both the mortality table and the interest rate shall be recommended9-by the actuary retained pursuant to section 79-984 following an actuarial10-experience study, a benefit adequacy study, or a plan valuation. The11-mortality table, interest rate, and actuarial factors in effect on the12-member's retirement date shall be used to calculate the actuarial13-equivalency of any retirement benefit. Such interest rate may be, but is14-not required to be, equal to the assumed rate; and15-(b) For joint and survivorship annuities: 16-(i) For members hired before July 1, 2018, a unisex retiree17-mortality table using sixty-five percent of the male mortality and18-thirty-five percent of the female mortality from the 1994 Group Annuity19-Mortality Table with a One Year Setback and using an interest rate of20-eight percent compounded annually and a unisex joint annuitant mortality21-table using thirty-five percent of the male mortality and sixty-five22-percent of the female mortality from the 1994 Group Annuity Mortality23-Table with a One Year Setback and using an interest rate of eight percent24-compounded annually; and 25-(ii) For members hired on or after July 1, 2018, or rehired on or26-after July 1, 2018, after termination of employment and being paid a27-retirement benefit, the determinations shall be based on a unisex28-mortality table and an interest rate specified by (A) the board until29-September 1, 2024, or (B) the retirement board beginning on September 1,30-2024. Both the mortality table and the interest rate shall be recommended31-LB295-2025-LB295-2025--48--by the actuary retained pursuant to section 79-984 following an actuarial1-experience study, a benefit adequacy study, or a plan valuation. The2-mortality table, interest rate, and actuarial factors in effect on the3-member's retirement date shall be used to calculate the actuarial4-equivalency of any retirement benefit. Such interest rate may be, but is5-not required to be, equal to the assumed rate; 6-(4) Administrator of the retirement system or administrator means7-(a) until September 1, 2024, the person administering the retirement8-system who is appointed by the board or (b) beginning on September 1,9-2024, the director appointed by the retirement board pursuant to section10-84-1503; 11-(5) Annuitant means any member receiving an allowance;12-(6) Annuity means annual payments, for both prior service and13-membership service, for life as provided in the Class V School Employees14-Retirement Act; 15-(7) Audit year means the period beginning January 1 in any year and16-ending on December 31 of that same year, which is the period of time used17-in the preparation of (a) the annual actuarial analysis and valuation and18-(b) a financial audit of the retirement system, including the investments19-of the retirement system; 20-(8) Beneficiary means any person entitled to receive or receiving a21-benefit by reason of the death of a member; 22-(9) Board means the board of trustees until July 1, 2021, and the23-board of education beginning July 1, 2021, and until September 1, 2024;24-(10) Board of education means the board or boards of education of a25-school district or districts; 26-(11) Board of trustees means: 27-(a) Until September 1, 2024, the entity established pursuant to28-section 79-980; and 29-(b) Beginning September 1, 2024, the board of education shall be30-deemed to be the successor in interest for all liability associated with31-LB295-2025-LB295-2025--49--the actions or inactions of the entity identified under subdivision (11)1-(a) of this section and as specified in the Class V School Employees2-Retirement Act; 3-(12)(a) Compensation means gross wages or salaries payable to the4-member during a fiscal year and includes (i) overtime pay, (ii) member5-contributions to the retirement system that are picked up under section6-414(h) of the Internal Revenue Code, as defined in section 49-801.01,7-(iii) retroactive salary payments paid pursuant to court order,8-arbitration, or litigation and grievance settlements, and (iv) amounts9-contributed by the member to plans under sections 125, 403(b), and 457 of10-the Internal Revenue Code, as defined in section 49-801.01, or any other11-section of the code which defers or excludes such amounts from income.12-(b) Compensation does not include (i) fraudulently obtained amounts13-as determined by the board, (ii) amounts for accrued unused sick leave or14-accrued unused vacation leave converted to cash payments, (iii) insurance15-premiums converted into cash payments, (iv) reimbursement for expenses16-incurred, (v) fringe benefits, (vi) per diems paid as expenses, (vii)17-bonuses for services not actually rendered, (viii) early retirement18-inducements, (ix) cash awards, (x) severance pay, or (xi) employer19-contributions made for the purposes of separation payments made at20-retirement and early retirement inducements. 21-(c) Compensation in excess of the limitations set forth in section22-401(a)(17) of the Internal Revenue Code, as defined in section 49-801.01,23-shall be disregarded; 24-(13) Council means the Nebraska Investment Council created and25-acting pursuant to section 72-1237; 26-(14) Creditable service means the sum of the membership service and27-the prior service, measured in one-tenth-year increments;28-(15) Early retirement date means, for members hired prior to July 1,29-2016, who have attained age fifty-five, that month and year selected by a30-member having at least ten years of membership creditable service which31-LB295-2025-LB295-2025--50--includes a minimum of five years of membership service. Early retirement1-date means, for members hired on or after July 1, 2016, that month and2-year selected by a member having at least five years of creditable3-service and who has attained age sixty; 4-(16) Early retirement inducement means, but is not limited to:5-(a) A benefit, bonus, or payment to a member by an employer in6-exchange for an agreement by the member to retire with a reduced7-retirement benefit; 8-(b) A benefit, bonus, or payment paid to a member by an employer in9-addition to the member's retirement benefit; 10-(c) Lump-sum or installment cash payments by an employer, except11-payments for accrued unused leave converted to cash payments;12-(d) An additional salary or wage component of any kind that is being13-paid by an employer as an incentive to leave employment and not for14-personal services performed for which creditable service is granted;15-(e) Partial or full employer payment of a member's health, dental,16-life, or long-term disability insurance benefits or cash in lieu of such17-insurance benefits that extend beyond the member's termination of18-employment and contract of employment dates. This subdivision does not19-apply to any period during which the member is contributing to the20-retirement system and being awarded creditable service; and21-(f) Any other form of separation payments made by an employer to a22-member at termination, including, but not limited to, purchasing23-retirement contracts for the member pursuant to section 79-514, or24-depositing money for the member in an account established under section25-403(b) of the Internal Revenue Code except for payments for accrued26-unused leave; 27-(17) Employee means the following enumerated persons receiving28-compensation from the school district: (a) Teachers, other than29-substitutes, employed on a written contract basis; (b) administrators30-employed on a written contract, agreement, or document basis; and (c)31-LB295-2025-LB295-2025--51--regular employees; 1-(18) Employer means a school district participating in a retirement2-system established pursuant to the Class V School Employees Retirement3-Act; 4-(19) Fiscal year means the period beginning September 1 in any year5-and ending on August 31 of the next succeeding year;6-(20) Hire date or date of hire means the first day of compensated7-service subject to retirement contributions; 8-(21) Interest means, for the purchase of service credit, the9-purchase of prior service credit, restored refunds, and delayed payments,10-the investment return assumption used in the most recent actuarial11-valuation; 12-(22) Member means any employee included in the membership of the13-retirement system or any former employee who has made contributions to14-the system and has not received a refund; 15-(23) Membership service means service on or after September 1, 1951,16-as an employee of the school district and a member of the system for17-which compensation is paid by the school district. Credit for more than18-one year of membership service shall not be allowed for service rendered19-in any fiscal year. Beginning September 1, 2005, a member shall be20-credited with a year of membership service for each fiscal year in which21-the member performs one thousand or more hours of compensated service as22-an employee of the school district. For an employee who becomes a member23-prior to July 1, 2018, an hour of compensated service shall include any24-hour for which the member is compensated by the school district during25-periods when no service is performed due to vacation or approved leave.26-For an employee who becomes a member on or after July 1, 2018, an hour of27-compensated service shall include any hour for which the member is28-compensated by the school district during periods when no service is29-performed due to used accrued sick days, used accrued vacation days,30-federal and state holidays, and jury duty leave for which the member is31-LB295-2025-LB295-2025--52--paid full compensation by an employer. If a member performs less than one1-thousand hours of compensated service during a fiscal year, one-tenth of2-a year of membership service shall be credited for each one hundred hours3-of compensated service by the member in such fiscal year. In determining4-a member's total membership service, all periods of membership service,5-including fractional years of membership service in one-tenth-year6-increments, shall be aggregated; 7-(24) Military service means service in the uniformed services as8-defined in 38 U.S.C. 4301 et seq., as such provision existed on March 27,9-1997; 10-(25) Normal retirement date means the end of the month during which11-the member attains age sixty-five and has completed at least five years12-of membership service; 13-(26) Participation means qualifying for and making required deposits14-to the retirement system during the course of a fiscal year;15-(27) Primary beneficiary means the person or persons entitled to16-receive or receiving a benefit by reason of the death of a member;17-(28) Prior service means service rendered prior to September 1,18-1951, for which credit is allowed under section 79-999, service rendered19-by retired employees receiving benefits under preexisting systems, and20-service for which credit is allowed under sections 79-990, 79-991,21-79-994, 79-995, and 79-997; 22-(29)(a) Regular employee means a person hired on a full-time basis,23-which basis shall contemplate a work week of not less than thirty hours,24-and who is not (i) a teacher employed on a written contract basis or (ii)25-an administrator employed on a written contract, agreement, or document26-basis. 27-(b) Effective September 1, 2021, a person hired by an employer or28-under contract to provide service for less than thirty hours per week but29-who provides service for an average of thirty hours or more per week in30-each calendar month of any three calendar months of a fiscal year shall,31-LB295-2025-LB295-2025--53--beginning with the next full payroll period : , 1-(i) Commence commence contributions ; and shall be2-(ii) Be deemed a regular employee; and 3-(iii) Remain a deemed regular employee regardless of hours worked4-thereafter; 5-(30) Regular interest means interest (a) on the total contributions6-of the member prior to the close of the last preceding fiscal year, (b)7-compounded annually, and (c)(i) beginning September 1, 2016, at a rate8-equal to the daily treasury yield curve for one-year treasury securities,9-as published by the Secretary of the Treasury of the United States, that10-applies on September 1 of each year and (ii) prior to September 1, 2016,11-at rates to be determined annually by the board, which shall have the12-sole, absolute, and final discretionary authority to make such13-determination, except that the rate for any given year in no event shall14-exceed the actual percentage of net earnings of the system during the15-last preceding fiscal year; 16-(31) Retirement allowance means the total annual retirement benefit17-payable to a member for service or disability; 18-(32) Retirement application means beginning on and after September19-1, 2024, the form approved and provided by the retirement system for20-acceptance of a member's request for either regular or disability21-retirement; 22-(33) Retirement board means the Public Employees Retirement Board23-created and acting pursuant to section 84-1501; 24-(34) Retirement date means the date of retirement of a member for25-service or disability as fixed by (a) the board for retirements occurring26-prior to September 1, 2024, or (b) the retirement board for retirements27-occurring on or after September 1, 2024; 28-(35) Retirement system or system means the School Employees'29-Retirement System of (corporate name of the school district as described30-in section 79-405) as provided for by the act; 31-LB295-2025-LB295-2025--54--(36) School district means an employer participating in a retirement1-system established pursuant to the Class V School Employees Retirement2-Act; 3-(37) Secondary beneficiary means the person or persons entitled to4-receive or receiving a benefit by reason of the death of all primary5-beneficiaries prior to the death of the member. If no primary beneficiary6-survives the member, secondary beneficiaries shall be treated in the same7-manner as primary beneficiaries; 8-(38) Solvency means the rate of all contributions required pursuant9-to the Class V School Employees Retirement Act is equal to or greater10-than the actuarially required contribution rate as annotated in the most11-recent valuation report prepared by the actuary retained for the12-retirement system as provided in section 79-984; 13-(39) State investment officer means the person appointed by the14-council pursuant to section 72-1240 and acting pursuant to the Nebraska15-State Funds Investment Act; 16-(40) Substitute employee means a person hired by an employer as a17-temporary employee to assume the duties of an employee due to a temporary18-absence of any employee. Substitute employee does not mean a person hired19-as an employee on an ongoing basis to assume the duties of other20-employees who are temporarily absent; 21-(41) Temporary employee means a person hired by an employer who is22-not an employee and who is hired to provide service for a limited period23-of time to accomplish a specific purpose or task. When such specific24-purpose or task is complete, the employment of such temporary employee25-shall terminate and in no case shall the temporary employment period26-exceed one year in duration; 27-(42)(a) Termination of employment or termination occurs on the date28-the member experiences a bona fide separation from service of employment29-with the member's employer, the date of which separation is the last day30-of service under the member's contractual agreement or, if there is no31-LB295-2025-LB295-2025--55--contract or only partial fulfillment of a contract, as determined by an1-employer. A member who experiences a separation from service shall comply2-with the return-to-work provisions of section 79-992 if the member3-returns to work for an employer. 4-(b) A member shall not be deemed to have incurred a termination of5-employment if the board determines that, based on the facts and6-circumstances, (i) a claimed termination of employment was not a bona7-fide separation from service with the employer; (ii) a member was8-compensated for a full contractual period when the member stopped working9-prior to the end date of the member's employment as determined by the10-member's contract or labor agreement; or (iii) a member prearranged a11-return to work that violates the Class V School Employees Retirement Act.12-(c) Nothing in this subdivision (42) precludes an employer from13-adopting a policy which limits or denies employees who have experienced a14-separation from service from working as a volunteer or substitute15-employee within one hundred eighty days after the employee experiences a16-separation from service; 17-(43) Transfer of management means the transition and transfer of the18-general management, administration, and operation of the retirement19-system from the board of trustees, board of education, and school20-district to the retirement board as described in the Class V School21-Employees Retirement Act. Transfer of management does not include:22-(a) Transfer of the school district's funding obligations described23-in the Class V School Employees Retirement Act or assumption of financial24-liability for such funding obligations by (i) the State of Nebraska, (ii)25-the retirement board, (iii) the Nebraska Public Employees Retirement26-Systems, (iv) any other state entity with duties related to27-administration of the retirement system, or (v) the council for its28-investment duties regarding the assets of the retirement system; or29-(b) Merger or consolidation of any Class V school employees30-retirement system established under the Class V School Employees31-LB295-2025-LB295-2025--56--Retirement Act with the School Employees Retirement System of the State1-of Nebraska or any other retirement system administered by the retirement2-board; 3-(44) Trustee means a trustee provided for in section 79-980; and4-(45) Voluntary service or volunteer means providing bona fide unpaid5-service to an employer. 6-Sec. 12. Section 79-9,103, Reissue Revised Statutes of Nebraska, is7-amended to read: 8-79-9,103 (1) Any annuity paid on or after September 1, 1983, to a9-member who retired prior to February 21, 1982, pursuant to the Class V10-School Employees Retirement Act, or to such member's beneficiary, or to a11-person who retired under the provisions of the retirement system12-established by statute for employees of Class V school districts in13-effect prior to September 1, 1951, or to such person's beneficiary, shall14-be adjusted by the increase in the cost of living or wage levels between15-the effective date of retirement and June 30, 1983, except that such16-increase shall not exceed the sum of one dollar and fifty cents per month17-for each year of creditable service and one dollar per month for each18-completed year of retirement as measured from the effective date of19-retirement to June 30, 1983. No separate adjustment in such annuity shall20-be made as a result of the changes made in section 79-9,113 pursuant to21-Laws 1983, LB 488. If a joint and survivor annuity was elected, the22-increase shall be actuarially adjusted so that the joint and survivor23-annuity remains the actuarial equivalent of the life annuity otherwise24-payable. 25-(2) In addition to the cost-of-living adjustment provided in26-subsection (1) of this section, any annuity paid on or after September 1,27-1986, pursuant to the act or pursuant to the provisions of the retirement28-system established by statute for employees of Class V school districts29-in effect prior to September 1, 1951, and on which the first payment was30-dated on or before September 1, 1985, shall be adjusted by the increase31-LB295-2025-LB295-2025--57--in the cost of living or wage levels between the effective date of1-retirement and June 30, 1986, except that such increase shall not exceed2-(a) three and one-half percent for annuities first paid on or after3-September 1, 1984, (b) seven percent for annuities first paid on or after4-September 1, 1983, but before September 1, 1984, or (c) ten and one-half5-percent for all other annuities. 6-(3) In addition to the cost-of-living adjustments provided in7-subsections (1) and (2) of this section, any annuity paid on or after8-September 1, 1989, pursuant to the act or pursuant to the provisions of9-the retirement system established by statute for employees of Class V10-school districts in effect prior to September 1, 1951, and on which the11-first payment was dated on or before September 1, 1988, shall be adjusted12-by the increase in the cost of living or wage levels between the13-effective date of retirement and June 30, 1989, except that such increase14-shall not exceed (a) three percent for annuities first paid on or after15-September 1, 1987, (b) six percent for annuities first paid on or after16-September 1, 1986, but before September 1, 1987, or (c) nine percent for17-all other annuities. 18-(4) In addition to the cost-of-living adjustments provided in19-subsections (1), (2), and (3) of this section, any annuity paid on or20-after September 1, 1992, pursuant to the act or pursuant to the21-provisions of the retirement system established by statute for employees22-of Class V school districts in effect prior to September 1, 1951, and on23-which the first payment was dated on or before October 1, 1991, shall be24-adjusted by the increase in the cost of living or wage levels between the25-effective date of retirement and June 30, 1992, except that such increase26-shall not exceed (a) three percent for annuities first paid after October27-1, 1990, (b) six percent for annuities first paid after October 1, 1989,28-but on or before October 1, 1990, or (c) nine percent for all other29-annuities. 30-(5) In addition to the cost-of-living adjustments provided in31-LB295-2025-LB295-2025--58--subsections (1), (2), (3), and (4) of this section, any annuity paid on1-or after September 1, 1995, pursuant to the act or pursuant to the2-provisions of the retirement system established by statute for employees3-of Class V school districts in effect prior to September 1, 1951, and on4-which the first payment was dated on or before October 1, 1994, shall be5-adjusted by the increase in the cost of living or wage levels between the6-effective date of retirement and June 30, 1995, except that such increase7-shall not exceed (a) three percent for annuities first paid after October8-1, 1993, (b) six percent for annuities first paid after October 1, 1992,9-but on or before October 1, 1993, or (c) nine percent for all other10-annuities. 11-(6) In addition to the cost-of-living adjustments provided in12-subsections (1), (2), (3), (4), and (5) of this section, any annuity paid13-pursuant to the act or pursuant to the provisions of the retirement14-system established by statute for employees of Class V school districts15-in effect prior to September 1, 1951, and on which the first payment was16-dated on or before October 1, 1994, shall be subject to adjustment to17-equal the greater of (a) the annuity payable to the member or beneficiary18-as adjusted, if applicable, under the provisions of subsection (1), (2),19-(3), (4), or (5) of this section or (b) ninety percent of the annuity20-which results when the original annuity that was paid to the member or21-beneficiary (before any cost-of-living adjustments under this section),22-is adjusted by the increase in the cost of living or wage levels between23-the commencement date of the annuity and June 30, 1995.24-(7) In addition to the cost-of-living adjustments provided in25-subsections (1), (2), (3), (4), (5), and (6) of this section, any annuity26-paid on or after September 1, 1998, pursuant to the act or pursuant to27-the provisions of the retirement system established by statute for28-employees of Class V school districts in effect prior to September 1,29-1951, and on which the first payment was dated on or before October 3,30-1997, shall be adjusted by the increase in the cost of living or wage31-LB295-2025-LB295-2025--59--levels between the effective date of retirement and June 30, 1998, except1-that such increase shall not exceed (a) three percent for annuities first2-paid after October 1, 1996, (b) six percent for annuities first paid3-after October 1, 1995, but on or before October 1, 1996, or (c) nine4-percent for all other annuities. 5-(8) Beginning January 1, 2000, and on January 1 of every year6-thereafter, for employees of Class V school districts who were members7-prior to July 1, 2013, a cost-of-living adjustment shall be made for any8-formula annuity being paid pursuant to the act, or pursuant to the9-provisions of the retirement system established by statute for employees10-of Class V school districts in effect prior to September 1, 1951, and on11-which the first payment was dated on or before October 3 preceding such12-January 1 adjustment date. The cost-of-living adjustment for any such13-annuity shall be the lesser of (a) one and one-half percent or (b) the14-increase in the consumer price index from the date such annuity first15-became payable through the August 31 preceding the January 1 adjustment16-date as reduced by the aggregate cost-of-living adjustments previously17-made to the annuity pursuant to this section. 18-(9) Beginning January 1, 2014, and on January 1 of every year19-thereafter, for employees of Class V school districts who became members20-on or after July 1, 2013, a cost-of-living adjustment shall be made for21-any formula annuity being paid pursuant to the act and on which the first22-payment was dated on or before October 3 preceding such January 123-adjustment date. The cost-of-living adjustment for any such annuity shall24-be the lesser of (a) one percent or (b) the increase in the consumer25-price index from the date such annuity first became payable through the26-August 31 preceding the January 1 adjustment date as reduced by the27-aggregate cost-of-living adjustments previously made to the annuity28-pursuant to this section. 29-(10) Beginning September 1, 1999, the actuary shall make an annual30-valuation of the assets and liabilities of the system. If the annual31-LB295-2025-LB295-2025--60--valuation made by the actuary, as approved by the board of trustees,1-indicates that the system has sufficient actuarial surplus to provide for2-a cost-of-living adjustment in addition to the adjustment made pursuant3-to subsection (8) or (9) of this section, the board of trustees may, in4-its discretion, declare by resolution that each annuity being paid5-pursuant to the act, or pursuant to the provisions of the retirement6-system established by statute for employees of Class V school districts7-in effect prior to September 1, 1951, and on which the first payment was8-dated on or before October 3 of the year such resolution is adopted,9-shall be increased beginning as of the January 1 following the date of10-the board of trustees' resolution by such percentage as may be declared11-by the board of trustees, except that such increase for any such annuity12-shall not exceed the increase in the consumer price index from the date13-such annuity first became payable through the applicable valuation date14-as reduced by the aggregate cost-of-living adjustments previously made to15-the annuity pursuant to this section. 16-(11) Except for the adjustments pursuant to subsection (13) of this17-section, the consumer price index to be used for determining any cost-of-18-living adjustment under this section shall be the Consumer Price Index -19-All Urban Consumers, as published by the Bureau of Labor Statistics of20-the United States Department of Labor. If this consumer price index is21-discontinued or replaced, a substitute index published by the United22-States Department of Labor shall be selected by the board if before23-September 1, 2024, or by the retirement board if on or after September 1,24-2024. Any substitute index selected shall be a reasonable representative25-measurement of the cost of living for retired employees. An annuity as26-increased by any cost-of-living adjustment made under this section shall27-be considered the base annuity amount for the purpose of future28-adjustments pursuant to this section. In no event shall any cost-of-29-living adjustment be deemed to affect or increase the amount of the base30-retirement annuity of a member as determined under section 79-999 or31-LB295-2025-LB295-2025--61--79-9,100. 1-(12) Any decision or determination by the board or retirement board,2-as applicable, (a) to declare or not declare a cost-of-living adjustment,3-(b) as to whether the annual valuation indicates a sufficient actuarial4-surplus to provide for a cost-of-living adjustment, or (c) pursuant to5-the selection of a substitute index shall be made in the sole, absolute,6-and final discretion of the board or retirement board, as applicable, and7-shall not be subject to challenge by any member or beneficiary. In no8-event shall the Legislature be constrained or limited in amending the9-system or increasing the benefits of members under the system, nor shall10-the board or retirement board, as applicable, be constrained from11-supporting any such change to the system, notwithstanding the effect of12-any such change upon the actuarial surplus of the system and the ability13-of the board or retirement board, as applicable, to declare future cost-14-of-living adjustments. 15-(13) The Legislature finds and declares that there exists in this16-state a pressing need to attract and retain qualified and dedicated17-public school employees and that one of the factors prospective public18-school employees consider when seeking or continuing public school19-employment is the retirement system and benefits the employment provides.20-The Legislature further finds that over the past decades, as reflected by21-the Medical Price Index published by the United States Department of22-Labor, the cost of medical care, including the cost of medications and23-insurance coverages, has increased at a rate in excess of that by which24-the Consumer Price Index - All Urban Consumers has increased. The25-Legislature further finds and declares that there accordingly exists a26-need to adjust the amount of retirement benefits paid to retired public27-school employees in order to assist them in meeting the increased cost of28-medical care. Therefor, in addition to the cost-of-living adjustments29-provided in subsections (1) through (12) of this section, commencing on30-October 3, 2001, and on October 3 of every year thereafter, a medical31-LB295-2025-LB295-2025--62--cost-of-living adjustment shall be paid to any annuitant who became a1-member prior to July 1, 2016, and has been paid an annuity from the2-retirement system for at least ten years through the October 3 adjustment3-date. The cost-of-living adjustment shall be paid in the form of a4-supplemental annuity providing monthly payments equal to the amount which5-results when (a) the fraction, not to exceed one, that results when the6-annuitant's years of creditable service at his or her retirement date is7-divided by twenty, is multiplied by (b) the product of ten dollars times8-the number of years, including attained one-half years, that such9-annuitant has received annuity payments from the retirement system10-through the October 3 adjustment date. The supplemental annuity being11-paid to an annuitant shall increase by ten dollars on October 3 of each12-subsequent year to reflect the additional year of annuity payments to the13-annuitant until the total amount of the supplemental annuity is two14-hundred fifty dollars. In no event shall the medical cost-of-living15-adjustment for any annuitant pursuant to this subsection result in the16-payment of a supplemental annuity exceeding two hundred fifty dollars per17-month. The supplemental annuity paid to an annuitant pursuant to this18-subsection shall cease at the death of the annuitant regardless of the19-form of retirement annuity being paid to the annuitant at the time of his20-or her death. 21-Sec. 13. Section 79-9,106, Reissue Revised Statutes of Nebraska, is22-amended to read: 23-79-9,106 (1) Upon the death of a member who has not yet retired and24-who has twenty years or more of creditable service, the member's primary25-beneficiary, as designated by the member in writing on forms provided by26-the system, shall receive a survivorship annuity in accordance with27-subdivision (1) of section 79-9,101 if the primary beneficiary is (a) the28-member's spouse or (b) one other designated beneficiary whose attained29-age in the calendar year of the member's death is no more than ten years30-less than the attained age of the member in such calendar year. The31-LB295-2025-LB295-2025--63--amount of such actuarially equivalent annuity shall be calculated using1-the attained ages of the member and the beneficiary and be based on the2-annuity earned to the date of the member's death without reduction due to3-any early commencement of benefits. If Within sixty days from the date of4-the member's death, if the member has not previously filed with the5-administrator of the retirement system a form requiring that only the6-survivorship annuity be paid, the beneficiary may request to receive in a7-lump sum an amount equal to the member's accumulated contributions. If8-prior to the member's death, the member files with the administrator of9-the retirement system a form requiring that the beneficiary receive a10-lump-sum settlement in lieu of the survivorship annuity, the beneficiary11-shall receive, in lieu of the survivorship annuity, a lump-sum settlement12-in an amount equal to the member's accumulated contributions13-notwithstanding any other provision of this section.14-(2) Upon the death of a member who has not yet retired and who has15-less than twenty years of creditable service or upon the death of a16-member who has not yet retired and who has twenty years or more of17-creditable service but whose beneficiary does not meet the criteria in18-subsection (1) of this section, a lump sum in an amount equal to the19-member's accumulated contributions shall be paid pursuant to section20-79-9,119. 21-(3) A lump-sum death benefit paid pursuant to subsection (1) or (2)22-of this section, other than the member's estate, that is an eligible23-distribution may be distributed in the form of a direct transfer to a24-retirement plan eligible to receive such transfer under the provisions of25-the Internal Revenue Code. 26-(4) For any member whose death occurs on or after January 1, 2007,27-while performing qualified military service as defined in section 414(u)28-of the Internal Revenue Code, the member's beneficiary shall be entitled29-to any additional death benefit that would have been provided, other than30-the accrual of any benefit relating to the period of qualified military31-LB295-2025-LB295-2025--64--service. The additional death benefit shall be determined as if the1-member had returned to employment with the school district and such2-employment had terminated on the date of the member's death.3-Sec. 14. Section 79-9,117, Reissue Revised Statutes of Nebraska, is4-amended to read: 5-79-9,117 (1)(a) Until September 1, 2024, the board of trustees shall6-establish a comprehensive preretirement planning program for school7-employees who are members of the retirement system. The program shall8-provide information and advice regarding the many changes members face9-upon retirement, including, but not limited to, changes in physical and10-mental health, housing, family life, leisure activity, and retirement11-income. 12-(b) Beginning September 1, 2024, the retirement board shall13-establish sessions as provided in section 84-1511 for school employees14-who are members of the retirement system. 15-(2) The preretirement planning program shall be available to all16-members. 17-(3) The preretirement planning program shall include information on18-the federal and state income tax consequences of the various annuity or19-retirement benefit options available to the member, information on social20-security benefits, information on various local, state, and federal21-government programs and programs in the private sector designed to assist22-elderly persons, and information and advice the board of trustees or23-retirement board, as applicable, deems valuable in assisting members in24-the transition from public employment to retirement.25-(4) The board of trustees or retirement board, as applicable, shall26-work with any governmental agency, including political subdivisions or27-bodies whose services or expertise may enhance the development or28-implementation of the preretirement planning program.29-(5) The costs of the preretirement planning program shall be charged30-back to the retirement system. 31-LB295-2025-LB295-2025--65--(6) An employer shall provide each member leave with pay to attend1-up to two preretirement planning programs or the equivalent of up to2-sixteen hours of preretirement planning programs. For purposes of this3-subsection, leave with pay means a day off paid by an employer and does4-not mean vacation, sick, personal, or compensatory time. A member may5-choose to attend a program more than twice, but such leave shall be at6-the expense of the member and shall be at the discretion of the employer.7-A member shall not be entitled to attend more than one preretirement8-planning program per fiscal year prior to actual election of retirement.9-(7) A nominal registration fee may be charged to each person10-attending a preretirement planning program to cover the costs for meals,11-meeting rooms, or other expenses incurred under such program.12-Sec. 15. Section 79-9,118, Reissue Revised Statutes of Nebraska, is13-amended to read: 14-79-9,118 No employee shall be authorized to participate in the15-retirement system unless the employee is a United States citizen or is16-lawfully present in the United States. The employing public school and17-the school employee shall maintain at least one of the following18-documents, which shall be unexpired , if applicable to the particular19-document or which has an expiration date that has been extended by the20-United States Department of Homeland Security or the United States21-Citizenship and Immigration Services so that such document is still22-valid, to demonstrate United States citizenship or lawful presence in the23-United States as of the employee's date of hire, and, beginning September24-1, 2024, produce any such document so maintained upon request of the25-retirement board or the Nebraska Public Employees Retirement Systems:26-(1) A state-issued driver's license; 27-(2) A state-issued identification card; 28-(3) A state-issued motor vehicle learner's permit;29-(4) (3) A certified copy of a birth certificate or delayed birth30-certificate issued in any state, territory, or possession of the United31-LB295-2025-LB295-2025--66--States; 1-(5) (4) A Consular Report of Birth Abroad issued by the United2-States Department of State; 3-(6) (5) A United States passport; 4-(7) (6) A foreign passport with a United States visa;5-(8) (7) A United States Certificate of Naturalization;6-(9) (8) A United States Certificate of Citizenship;7-(10) (9) A tribal certificate of Native American blood or similar8-document; 9-(11) (10) A United States Citizenship and Immigration Services10-Employment Authorization Document, Form I-766; 11-(12) (11) A United States Citizenship and Immigration Services12-Permanent Resident Card, Form I-551; or 13-(13) (12) Any other document issued by the United States Department14-of Homeland Security or the United States Citizenship and Immigration15-Services granting employment authorization in the United States and16-approved (a) until September 1, 2024, by the board of trustees and (b)17-beginning September 1, 2024, by the retirement board.18-Sec. 16. Section 81-2014, Reissue Revised Statutes of Nebraska, is19-amended to read: 20-81-2014 For purposes of the Nebraska State Patrol Retirement Act:21-(1)(a) Actuarial equivalent means the equality in value of the22-aggregate amounts expected to be received under different forms of23-payment or to be received at an earlier retirement age than the normal24-retirement age. 25-(b) For an officer hired before July 1, 2017, the determinations26-shall be based on the 1994 Group Annuity Mortality Table reflecting sex-27-distinct factors blended using seventy-five percent of the male table and28-twenty-five percent of the female table. An interest rate of eight29-percent per annum shall be reflected in making the determinations until30-such percent is amended by the Legislature. 31-LB295-2025-LB295-2025--67--(c) For an officer hired on or after July 1, 2017, or rehired on or1-after July 1, 2017, after termination of employment and being paid a2-retirement benefit or taking a refund of contributions, the3-determinations shall be based on a unisex mortality table and an interest4-rate specified by the board. Both the mortality table and the interest5-rate shall be recommended by the actuary and approved by the board6-following an actuarial experience study, a benefit adequacy study, or a7-plan valuation. The mortality table, interest rate, and actuarial factors8-in effect on the officer's retirement date will be used to calculate9-actuarial equivalency of any retirement benefit. Such interest rate may10-be, but is not required to be, equal to the assumed rate of return;11-(2) Board means the Public Employees Retirement Board;12-(3)(a)(i) Compensation means gross wages or salaries payable to the13-member for personal services performed during the plan year. Compensation14-does not include insurance premiums converted into cash payments,15-reimbursement for expenses incurred, fringe benefits, per diems, or16-bonuses for services not actually rendered, including, but not limited17-to, early retirement inducements, cash awards, and severance pay, except18-for retroactive salary payments paid pursuant to court order,19-arbitration, or litigation and grievance settlements. Compensation20-includes overtime pay, member retirement contributions, and amounts21-contributed by the member to plans under sections 125 and 457 of the22-Internal Revenue Code as defined in section 49-801.01 or any other23-section of the code which defers or excludes such amounts from income.24-(ii) For any officer employed on or prior to January 4, 1979,25-compensation includes compensation for unused sick leave or unused26-vacation leave converted to cash payments. 27-(iii) For any officer employed after January 4, 1979, and prior to28-July 1, 2016, compensation does not include compensation for unused sick29-leave or unused vacation leave converted to cash payments and includes30-compensation for unused holiday compensatory time and unused compensatory31-LB295-2025-LB295-2025--68--time converted to cash payments. 1-(iv) For any officer employed on or after July 1, 2016, compensation2-does not include compensation for unused sick leave, unused vacation3-leave, unused holiday compensatory time, unused compensatory time, or any4-other type of unused leave, compensatory time, or similar benefits,5-converted to cash payments. 6-(b) Compensation in excess of the limitations set forth in section7-401(a)(17) of the Internal Revenue Code as defined in section 49-801.018-shall be disregarded. For an employee who was a member of the retirement9-system before the first plan year beginning after December 31, 1995, the10-limitation on compensation shall not be less than the amount which was11-allowed to be taken into account under the retirement system as in effect12-on July 1, 1993; 13-(4) Creditable service means service granted pursuant to section14-81-2034 and all service rendered while a contributing member of the15-retirement system. Creditable service includes working days, sick days,16-vacation days, holidays, and any other leave days for which the officer17-is paid regular wages except as specifically provided in the Nebraska18-State Patrol Retirement Act. Creditable service does not include19-eligibility and vesting credit nor service years for which member20-contributions are withdrawn and not repaid; 21-(5) Current benefit means the initial benefit increased by all22-adjustments made pursuant to the Nebraska State Patrol Retirement Act;23-(6) DROP means the deferred retirement option plan as provided in24-section 81-2041; 25-(7) DROP account means an individual DROP participant's defined26-contribution account under section 414(k) of the Internal Revenue Code;27-(8) DROP period means the amount of time the member elects to28-participate in DROP which shall be for a period not to exceed five years29-from and after the date of the member's DROP election;30-(9) Eligibility and vesting credit means credit for years, or a31-LB295-2025-LB295-2025--69--fraction of a year, of participation in a Nebraska government plan for1-purposes of determining eligibility for benefits under the Nebraska State2-Patrol Retirement Act. Such credit shall be used toward the vesting3-percentage pursuant to subsection (2) of section 81-2031 but shall not be4-included as years of service in the benefit calculation;5-(10) Hire date or date of hire means the first day of compensated6-service subject to retirement contributions; 7-(11) Initial benefit means the retirement benefit calculated at the8-time of retirement; 9-(12) Officer means law enforcement officer as defined in section10-81-1401 and as provided for in sections 81-2001 to 81-2009, but does not11-include a noncertified conditional officer as defined in section 81-1401;12-(13) Plan year means the twelve-month period beginning on July 1 and13-ending on June 30 of the following year; 14-(14) Regular interest means interest fixed at a rate equal to the15-daily treasury yield curve for one-year treasury securities, as published16-by the Secretary of the Treasury of the United States, that applies on17-July 1 of each year, which may be credited monthly, quarterly,18-semiannually, or annually as the board may direct;19-(15) Required beginning date means, for purposes of the deferral of20-distributions and the commencement of mandatory distributions pursuant to21-section 401(a)(9) of the Internal Revenue Code and the regulations issued22-thereunder, April 1 of the year following the calendar year in which a23-member: 24-(a)(i) Terminated employment with the State of Nebraska; and25-(ii)(A) Attained at least seventy and one-half years of age for a26-member who attained seventy and one-half years of age on or before27-December 31, 2019; 28-(B) Attained at least seventy-two years of age for a member who29-attained seventy and one-half years of age on or after January 1, 2020,30-and prior to January 1, 2023; 31-LB295-2025-LB295-2025--70--(C) Attained at least seventy-three years of age for a member who1-attained seventy-two years of age after December 31, 2022, and seventy-2-three years of age prior to January 1, 2033; or 3-(D) Attained at least seventy-five years of age for a member who4-attained seventy-four years of age after December 31, 2032; or5-(b)(i) Terminated employment with the State of Nebraska; and6-(ii) Otherwise reached the date specified by section 401(a)(9) of7-the Internal Revenue Code and the regulations issued thereunder;8-(16) Retirement application means the form approved and provided by9-the retirement system for acceptance of a member's request for either10-regular or disability retirement; 11-(17) Retirement date means (a) the first day of the month following12-the date upon which a member's request for retirement is received on a13-retirement application if the member is eligible for retirement and has14-terminated employment or (b) the first day of the month following15-termination of employment if the member is eligible for retirement and16-has filed an application but has not yet terminated employment;17-(18) Retirement system or system means the Nebraska State Patrol18-Retirement System as provided in the act; 19-(19) Service means employment as a member of the Nebraska State20-Patrol and shall not be deemed to be interrupted by (a) temporary or21-seasonal suspension of service that does not terminate the employee's22-employment, (b) leave of absence authorized by the employer for a period23-not exceeding twelve months, (c) leave of absence because of disability,24-or (d) military service, when properly authorized by the board. Service25-does not include any period of disability for which disability retirement26-benefits are received under subsection (1) of section 81-2025;27-(20) Surviving spouse means (a) the spouse married to the member on28-the date of the member's death if married for at least one year prior to29-death or if married on the date of the member's retirement or (b) the30-spouse or former spouse of the member if survivorship rights are provided31-LB295-2025-LB295-2025--71--under a qualified domestic relations order filed with the board pursuant1-to the Spousal Pension Rights Act. The spouse or former spouse shall2-supersede the spouse married to the member on the date of the member's3-death as provided under a qualified domestic relations order. If the4-benefits payable to the spouse or former spouse under a qualified5-domestic relations order are less than the value of benefits entitled to6-the surviving spouse, the spouse married to the member on the date of the7-member's death shall be the surviving spouse for the balance of the8-benefits; and 9-(21)(a) (21) Termination of employment occurs on the date on which10-the Nebraska State Patrol determines that the officer's employer-employee11-relationship with the patrol is dissolved. The Nebraska State Patrol12-shall notify the board of the date on which such a termination has13-occurred. 14-(b) Termination of employment does not include ceasing employment15-with the Nebraska State Patrol if the officer returns to regular16-employment with the Nebraska State Patrol or another agency of the State17-of Nebraska and there are less than one hundred twenty days between the18-date when the employee's employer-employee relationship ceased and the19-date when the employer-employee relationship commenced with the Nebraska20-State Patrol or another state agency. Termination of employment does not21-occur upon an officer's participation in DROP pursuant to section22-81-2041. 23-(c) It is the responsibility of the employer that is involved in the24-termination of employment to notify the board of such change in25-employment and provide the board with such information as the board deems26-necessary. 27-(d) If the board determines that termination of employment has not28-occurred and a retirement benefit has been paid to a member of the29-retirement system pursuant to section 81-2026, the board shall require30-the member who has received such benefit to repay the benefit to the31-LB295-2025-LB295-2025--72--retirement system unless the board determines that all or any portion of1-such benefit was the result of an inadvertent overpayment.2-Sec. 17. Section 81-2016, Reissue Revised Statutes of Nebraska, is3-amended to read: 4-81-2016 (1) Every member of the Nebraska State Patrol who was5-employed by the State of Nebraska as such, on September 7, 1947, and6-every person employed as a member of such patrol thereafter, shall be a7-member of the system, except for those members of the Nebraska State8-Patrol who elected pursuant to section 60-1304 to remain members of the9-State Employees Retirement System of the State of Nebraska.10-(2) No employee shall be authorized to participate in the retirement11-system provided for in the Nebraska State Patrol Retirement Act unless12-the employee is a United States citizen or is lawfully present in the13-United States. The employing state agency and the employee shall maintain14-at least one of the following documents , which shall be unexpired , if15-applicable to the particular document or which has an expiration date16-that has been extended by the United States Department of Homeland17-Security or the United States Citizenship and Immigration Services so18-that such document is still valid, to demonstrate United States19-citizenship or lawful presence in the United States as of the employee's20-date of hire and produce any such document so maintained upon request of21-the board or the Nebraska Public Employees Retirement Systems:22-(a) A state-issued driver's license; 23-(b) A state-issued identification card; 24-(c) A state-issued motor vehicle learner's permit;25-(d) (c) A certified copy of a birth certificate or delayed birth26-certificate issued in any state, territory, or possession of the United27-States; 28-(e) (d) A Consular Report of Birth Abroad issued by the United29-States Department of State; 30-(f) (e) A United States passport; 31-LB295-2025-LB295-2025--73--(g) (f) A foreign passport with a United States visa;1-(h) (g) A United States Certificate of Naturalization;2-(i) (h) A United States Certificate of Citizenship;3-(j) (i) A tribal certificate of Native American blood or similar4-document; 5-(k) (j) A United States Citizenship and Immigration Services6-Employment Authorization Document, Form I-766; 7-(l) (k) A United States Citizenship and Immigration Services8-Permanent Resident Card, Form I-551; or 9-(m) (l) Any other document issued by the United States Department of10-Homeland Security or the United States Citizenship and Immigration11-Services granting employment authorization in the United States and12-approved by the board. 13-(3) Within the first one hundred eighty days of employment, a member14-may apply to the board for eligibility and vesting credit for years of15-participation in another Nebraska governmental plan, as defined by16-section 414(d) of the Internal Revenue Code. During the years of17-participation in the other Nebraska governmental plan, the employee must18-have been a full-time employee, as defined in the Nebraska governmental19-plan in which the credit was earned. 20-(4) Any officer who qualifies for membership pursuant to subsection21-(1) of this section may not be disqualified from membership in the22-retirement system solely because such officer also maintains separate23-employment which qualifies the officer for membership in another public24-retirement system, nor may membership in this retirement system25-disqualify such an officer from membership in another public retirement26-system solely by reason of separate employment which qualifies such27-officer for membership in this retirement system. 28-(5) Information necessary to determine membership shall be provided29-by the Nebraska State Patrol. 30-(6) The board may adopt and promulgate rules and regulations31-LB295-2025-LB295-2025--74--governing the assessment and granting of eligibility and vesting credit.1-Sec. 18. Section 81-2017, Reissue Revised Statutes of Nebraska, is2-amended to read: 3-81-2017 (1)(a)(i) Commencing July 1, 2010, and until July 1, 2011,4-each officer while in the service of the Nebraska State Patrol shall pay5-or have paid on such officer's behalf a sum equal to sixteen percent of6-such officer's monthly compensation. 7-(ii) Commencing July 1, 2011, and until July 1, 2013, each officer8-while in the service of the Nebraska State Patrol shall pay or have paid9-on such officer's behalf a sum equal to nineteen percent of such10-officer's monthly compensation. 11-(iii)(A) Commencing July 1, 2013, and until July 1, 2024, each12-officer who commenced service prior to July 1, 2016, while in the service13-of the Nebraska State Patrol shall pay or have paid on such officer's14-behalf a sum equal to sixteen percent of such officer's monthly15-compensation. 16-(B) Until July 1, 2024, each officer who commenced service on or17-after July 1, 2016, while in the service of the Nebraska State Patrol18-shall pay or have paid on such officer's behalf a sum equal to seventeen19-percent of such officer's monthly compensation. 20-(iv) Commencing July 1, 2024, each officer while in the service of21-the Nebraska State Patrol shall pay or have paid on such officer's behalf22-a sum equal to ten percent of such officer's monthly compensation.23-(b) Such amounts shall be deducted monthly by the Director of24-Administrative Services who shall draw a warrant monthly in the amount of25-the total deductions from the compensation of members of the Nebraska26-State Patrol in accordance with subsection (4) of this section, and the27-State Treasurer shall credit the amount of such warrant to the State28-Patrol Retirement Fund. The director shall cause a detailed report of all29-monthly deductions to be made each month to the board.30-(2) In addition: 31-LB295-2025-LB295-2025--75--(a)(i) Commencing July 1, 2010, and until July 1, 2011, there shall1-be assessed against the appropriation of the Nebraska State Patrol a sum2-equal to the amount of sixteen percent of each officer's monthly3-compensation, which shall be credited to the State Patrol Retirement4-Fund. 5-(ii) Commencing July 1, 2011, and until July 1, 2013, there shall be6-assessed against the appropriation of the Nebraska State Patrol a sum7-equal to the amount of nineteen percent of each officer's monthly8-compensation, which shall be credited to the State Patrol Retirement9-Fund. 10-(iii)(A) Commencing July 1, 2013, and until July 1, 2024, for each11-officer who commenced service prior to July 1, 2016, there shall be12-assessed against the appropriation of the Nebraska State Patrol a sum13-equal to the amount of sixteen percent of each officer's monthly14-compensation, which shall be credited to the State Patrol Retirement15-Fund. 16-(B) Commencing July 1, 2016, and until July 1, 2024, for each17-officer who commenced service on or after July 1, 2016, there shall be18-assessed against the appropriation of the Nebraska State Patrol a sum19-equal to the amount of seventeen percent of each officer's monthly20-compensation, which shall be credited to the State Patrol Retirement21-Fund. 22-(iv) Commencing July 1, 2024, there shall be assessed against the23-appropriation of the Nebraska State Patrol a sum equal to the amount of24-twenty-four percent of each officer's monthly compensation, which shall25-be credited to the State Patrol Retirement Fund. 26-(b) This assessment constitutes an employer match and shall be27-contingent upon the officer making such officer's contributions to the28-retirement system. 29-(3)(a) Prior to July 1, 2021: 30-(i) Beginning July 1, 2002, and each fiscal year thereafter, the31-LB295-2025-LB295-2025--76--board shall cause an annual actuarial valuation to be performed that will1-value the plan assets for the year and ascertain the contributions2-required for such fiscal year. The actuary for the board shall perform an3-actuarial valuation of the system on the basis of actuarial assumptions4-recommended by the actuary, approved by the board, and kept on file with5-the board using the entry age actuarial cost method. Under this method,6-the actuarially required funding rate is equal to the normal cost rate,7-plus the contribution rate necessary to amortize the unfunded actuarial8-accrued liability on a level percentage of salary basis. The normal cost9-under this method shall be determined for each individual member on a10-level percentage of salary basis. The normal cost amount is then summed11-for all members; 12-(ii) Beginning July 1, 2006, any existing unfunded liabilities shall13-be reinitialized and amortized over a thirty-year period, and during each14-subsequent actuarial valuation through June 30, 2021, changes in the15-unfunded actuarial accrued liability due to changes in benefits,16-actuarial assumptions, the asset valuation method, or actuarial gains or17-losses shall be measured and amortized over a thirty-year period18-beginning on the valuation date of such change; 19-(iii) If the unfunded actuarial accrued liability under the entry20-age actuarial cost method is zero or less than zero on an actuarial21-valuation date, then all prior unfunded actuarial accrued liabilities22-shall be considered fully funded and the unfunded actuarial accrued23-liability shall be reinitialized and amortized over a thirty-year period24-as of the actuarial valuation date; and 25-(iv) If the actuarially required contribution rate exceeds the rate26-of all contributions required pursuant to the Nebraska State Patrol27-Retirement Act, there shall be a supplemental appropriation sufficient to28-pay for the differences between the actuarially required contribution29-rate and the rate of all contributions required pursuant to the act.30-(b) Beginning July 1, 2021, and each fiscal year thereafter:31-LB295-2025-LB295-2025--77--(i) The board shall cause an annual actuarial valuation to be1-performed that will value the plan assets for the year and ascertain the2-contributions required for such fiscal year. The actuary for the board3-shall perform an actuarial valuation of the system on the basis of4-actuarial assumptions recommended by the actuary, approved by the board,5-and kept on file with the board using the entry age actuarial cost6-method. Under such method, the actuarially required funding rate is equal7-to the normal cost rate, plus the contribution rate necessary to amortize8-the unfunded actuarial accrued liability on a level percentage of salary9-basis. The normal cost under such method shall be determined for each10-individual member on a level percentage of salary basis. The normal cost11-amount is then summed for all members; 12-(ii) Any changes in the unfunded actuarial accrued liability due to13-changes in benefits, actuarial assumptions, the asset valuation method,14-or actuarial gains or losses shall be measured and amortized over a15-twenty-five-year period beginning on the valuation date of such change;16-(iii) If the unfunded actuarial accrued liability under the entry17-age actuarial cost method is zero or less than zero on an actuarial18-valuation date, then all prior unfunded actuarial accrued liabilities19-shall be considered fully funded and the unfunded actuarial accrued20-liability shall be reinitialized and amortized over a twenty-five-year21-period as of the actuarial valuation date; and 22-(iv) If the actuarially required contribution rate exceeds the rate23-of all contributions required pursuant to the Nebraska State Patrol24-Retirement Act, it is the intent of the Legislature that there shall be a25-supplemental appropriation sufficient to pay for the differences between26-the actuarially required contribution rate and the rate of all27-contributions required pursuant to the act. 28-(c) Upon the recommendation of the actuary to the board, and after29-the board notifies the Nebraska Retirement Systems Committee of the30-Legislature, the board may combine or offset certain amortization bases31-LB295-2025-LB295-2025--78--to reduce future volatility of the actuarial contribution rate. Such1-notification to the committee shall be in writing and include, at a2-minimum, the actuary's projection of the contributions to fund the plan3-if the combination or offset were not implemented, the actuary's4-projection of the contributions to fund the plan if the combination or5-offset were implemented, and the actuary's explanation of why the6-combination or offset is in the best interests of the plan at the7-proposed time. 8-(4) The state shall pick up the member contributions required by9-this section for all compensation paid on or after January 1, 1985, and10-the contributions so picked up shall be treated as employer contributions11-pursuant to section 414(h)(2) of the Internal Revenue Code in determining12-federal tax treatment under the code and shall not be included as gross13-income of the member until such time as they are distributed or made14-available. The contributions, although designated as member15-contributions, shall be paid by the state in lieu of member16-contributions. The state shall pay these member contributions from the17-same source of funds which is used in paying earnings to the member. The18-state shall pick up these contributions by a compensation deduction19-through a reduction in the cash compensation of the member. Member20-contributions picked up shall be treated for all purposes of the Nebraska21-State Patrol Retirement Act in the same manner and to the extent as22-member contributions made prior to the date picked up.23-Sec. 19. Section 84-1301, Reissue Revised Statutes of Nebraska, is24-amended to read: 25-84-1301 For purposes of the State Employees Retirement Act, unless26-the context otherwise requires: 27-(1)(a) Actuarial equivalent means the equality in value of the28-aggregate amounts expected to be received under different forms of an29-annuity payment. 30-(b) For an employee hired prior to January 1, 2018, the mortality31-LB295-2025-LB295-2025--79--assumption used for purposes of converting the member cash balance1-account shall be the 1994 Group Annuity Mortality Table using a unisex2-rate that is fifty percent male and fifty percent female. For purposes of3-converting the member cash balance account attributable to contributions4-made prior to January 1, 1984, that were transferred pursuant to the act,5-the 1994 Group Annuity Mortality Table for males shall be used.6-(c) For an employee hired on or after January 1, 2018, or rehired on7-or after January 1, 2018, after termination of employment and being paid8-a retirement benefit or taking a refund of contributions, the mortality9-assumption used for purposes of converting the member cash balance10-account shall be a unisex mortality table that is recommended by the11-actuary and approved by the board following an actuarial experience12-study, a benefit adequacy study, or a plan valuation. The mortality table13-and actuarial factors in effect on the member's retirement date will be14-used to calculate the actuarial equivalency of any retirement benefit;15-(2) Annuity means equal monthly payments provided by the retirement16-system to a member or beneficiary under forms determined by the board17-beginning the first day of the month after an annuity election is18-received in the office of the Nebraska Public Employees Retirement19-Systems or the first day of the month after the employee's termination of20-employment, whichever is later. The last payment shall be at the end of21-the calendar month in which the member dies or in accordance with the22-payment option chosen by the member; 23-(3) Annuity start date means the date upon which a member's annuity24-is first effective and shall be the first day of the month following the25-member's termination or following the date the application is received by26-the board, whichever is later; 27-(4) Cash balance benefit means a member's retirement benefit that is28-equal to an amount based on annual employee contribution credits plus29-interest credits and, if vested, employer contribution credits plus30-interest credits and dividend amounts credited in accordance with31-LB295-2025-LB295-2025--80--subdivision (4)(c) of section 84-1319; 1-(5)(a) Compensation means gross wages or salaries payable to the2-member for personal services performed during the plan year. Compensation3-does not include insurance premiums converted into cash payments,4-reimbursement for expenses incurred, fringe benefits, per diems, or5-bonuses for services not actually rendered, including, but not limited6-to, early retirement inducements, cash awards, and severance pay, except7-for retroactive salary payments paid pursuant to court order,8-arbitration, or litigation and grievance settlements. Compensation9-includes overtime pay, member retirement contributions, and amounts10-contributed by the member to plans under sections 125, 403(b), and 457 of11-the Internal Revenue Code or any other section of the code which defers12-or excludes such amounts from income. 13-(b) Compensation in excess of the limitations set forth in section14-401(a)(17) of the Internal Revenue Code shall be disregarded. For an15-employee who was a member of the retirement system before the first plan16-year beginning after December 31, 1995, the limitation on compensation17-shall not be less than the amount which was allowed to be taken into18-account under the retirement system as in effect on July 1, 1993;19-(6) Date of disability means the date on which a member is20-determined to be disabled by the board; 21-(7) Defined contribution benefit means a member's retirement benefit22-from a money purchase plan in which member benefits equal annual23-contributions and earnings pursuant to section 84-1310 and, if vested,24-employer contributions and earnings pursuant to section 84-1311;25-(8) Disability means an inability to engage in any substantially26-gainful activity by reason of any medically determinable physical or27-mental impairment which was initially diagnosed or became disabling while28-the member was an active participant in the plan and which can be29-expected to result in death or to be of long-continued and indefinite30-duration; 31-LB295-2025-LB295-2025--81--(9) Employee means any person or officer employed by the State of1-Nebraska whose compensation is paid out of state funds or funds2-controlled or administered by a state department through any of its3-executive or administrative officers when acting exclusively in their4-respective official, executive, or administrative capacities and any5-employee of the State Board of Agriculture who is a member of the state6-retirement system on July 1, 1982. Employee does not include (a) judges7-as defined in section 24-701, (b) members of the Nebraska State Patrol,8-except for those members of the Nebraska State Patrol who elected9-pursuant to section 60-1304 to remain members of the State Employees10-Retirement System of the State of Nebraska, (c) employees of the11-University of Nebraska, (d) employees of the state colleges, (e)12-employees of community colleges, (f) employees of the Department of Labor13-employed prior to July 1, 1984, and paid from funds provided pursuant to14-Title III of the federal Social Security Act or funds from other federal15-sources, except that if the contributory retirement plan or contract let16-pursuant to section 48-609, as such section existed prior to January 1,17-2018, is terminated, such employees shall become employees for purposes18-of the State Employees Retirement Act on the first day of the first pay19-period following the termination of such contributory retirement plan or20-contract, (g) employees of the State Board of Agriculture who are not21-members of the state retirement system on July 1, 1982, (h) the Nebraska22-National Guard air and army technicians, (i) persons who are required to23-participate in the School Employees Retirement System of the State of24-Nebraska pursuant to section 79-920, except that those persons so25-required and actively contributing to the State Employees Retirement26-System of the State of Nebraska as of March 4, 2022, shall continue as27-members of the State Employees Retirement System of the State of28-Nebraska, or (j) employees of the Coordinating Commission for29-Postsecondary Education who are eligible for and have elected to become30-members of a qualified retirement program approved by the commission31-LB295-2025-LB295-2025--82--which is commensurate with retirement programs at the University of1-Nebraska. Any individual appointed by the Governor may elect not to2-become a member of the State Employees Retirement System of the State of3-Nebraska; 4-(10) Employee contribution credit means an amount equal to the5-member contribution amount required by section 84-1308;6-(11) Employer contribution credit means an amount equal to the7-employer contribution amount required by section 84-1309;8-(12) Final account value means the value of a member's account on9-the date the account is either distributed to the member or used to10-purchase an annuity from the plan, which date shall occur as soon as11-administratively practicable after receipt of a valid application for12-benefits, but no sooner than forty-five days after the member's13-termination; 14-(13) Five-year break in service means five consecutive one-year15-breaks in service; 16-(14) Full-time employee means an employee who is employed to work17-one-half or more of the regularly scheduled hours during each pay period;18-(15) Fund means the State Employees Retirement Fund created by19-section 84-1309; 20-(16) Guaranteed investment contract means an investment contract or21-account offering a return of principal invested plus interest at a22-specified rate. For investments made after July 19, 1996, guaranteed23-investment contract does not include direct obligations of the United24-States or its instrumentalities, bonds, participation certificates or25-other obligations of the Federal National Mortgage Association, the26-Federal Home Loan Mortgage Corporation, or the Government National27-Mortgage Association, or collateralized mortgage obligations and other28-derivative securities. This subdivision shall not be construed to require29-the liquidation of investment contracts or accounts entered into prior to30-July 19, 1996; 31-LB295-2025-LB295-2025--83--(17) Hire date or date of hire means the first day of compensated1-service subject to retirement contributions; 2-(18) Interest credit rate means the greater of (a) five percent or3-(b) the applicable federal mid-term rate, as published by the Internal4-Revenue Service as of the first day of the calendar quarter for which5-interest credits are credited, plus one and one-half percent, such rate6-to be compounded annually; 7-(19) Interest credits means the amounts credited to the employee8-cash balance account and the employer cash balance account at the end of9-each day. Such interest credit for each account shall be determined by10-applying the daily portion of the interest credit rate to the account11-balance at the end of the previous day. Such interest credits shall12-continue to be credited to the employee cash balance account and the13-employer cash balance account after a member ceases to be an employee,14-except that no such credit shall be made with respect to the employee15-cash balance account and the employer cash balance account for any day16-beginning on or after the member's date of final account value. If17-benefits payable to the member's surviving spouse or beneficiary are18-delayed after the member's death, interest credits shall continue to be19-credited to the employee cash balance account and the employer cash20-balance account until such surviving spouse or beneficiary commences21-receipt of a distribution from the plan; 22-(20) Member cash balance account means an account equal to the sum23-of the employee cash balance account and, if vested, the employer cash24-balance account and dividend amounts credited in accordance with25-subdivision (4)(c) of section 84-1319; 26-(21) One-year break in service means a plan year during which the27-member has not completed more than five hundred hours of service;28-(22) Participation means qualifying for and making the required29-deposits to the retirement system during the course of a plan year;30-(23) Part-time employee means an employee who is employed to work31-LB295-2025-LB295-2025--84--less than one-half of the regularly scheduled hours during each pay1-period; 2-(24) Plan year means the twelve-month period beginning on January 13-and ending on December 31; 4-(25) Prior service means service before January 1, 1964;5-(26) Regular interest means the rate of interest earned each6-calendar year commencing January 1, 1975, as determined by the retirement7-board in conformity with actual and expected earnings on the investments8-through December 31, 1984; 9-(27) Required beginning date means, for purposes of the deferral of10-distributions and the commencement of mandatory distributions pursuant to11-section 401(a)(9) of the Internal Revenue Code and the regulations issued12-thereunder, April 1 of the year following the calendar year in which a13-member: 14-(a)(i) Terminated employment with the State of Nebraska; and15-(ii)(A) Attained at least seventy and one-half years of age for a16-member who attained seventy and one-half years of age on or before17-December 31, 2019; 18-(B) Attained at least seventy-two years of age for a member who19-attained seventy and one-half years of age on or after January 1, 2020,20-and prior to January 1, 2023; 21-(C) Attained at least seventy-three years of age for a member who22-attained seventy-two years of age after December 31, 2022, and seventy-23-three years of age prior to January 1, 2033; or 24-(D) Attained at least seventy-five years of age for a member who25-attained seventy-four years of age after December 31, 2032; or26-(b)(i) Terminated employment with the State of Nebraska; and27-(ii) Otherwise reached the date specified by section 401(a)(9) of28-the Internal Revenue Code and the regulations issued thereunder;29-(28) Required contribution means the deduction to be made from the30-compensation of employees as provided in section 84-1308;31-LB295-2025-LB295-2025--85--(29) Retirement means qualifying for and accepting the retirement1-benefit granted under the State Employees Retirement Act after2-terminating employment; 3-(30) Retirement application means the form approved and provided by4-the retirement system for acceptance of a member's request for either5-regular or disability retirement; 6-(31) Retirement board or board means the Public Employees Retirement7-Board; 8-(32) Retirement date means (a) the first day of the month following9-the date upon which a member's request for retirement is received on a10-retirement application if the member is eligible for retirement and has11-terminated employment or (b) the first day of the month following12-termination of employment if the member is eligible for retirement and13-has filed an application but has not yet terminated employment;14-(33) Retirement system means the State Employees Retirement System15-of the State of Nebraska; 16-(34) Service means the actual total length of employment as an17-employee and shall not be deemed to be interrupted by (a) temporary or18-seasonal suspension of service that does not terminate the employee's19-employment, (b) leave of absence authorized by the employer for a period20-not exceeding twelve months, (c) leave of absence because of disability,21-or (d) military service, when properly authorized by the retirement22-board. Service does not include any period of disability for which23-disability retirement benefits are received under section 84-1317;24-(35) State department means any department, bureau, commission, or25-other division of state government not otherwise specifically defined or26-exempted in the act, the employees and officers of which are not already27-covered by a retirement plan; 28-(36) Surviving spouse means (a) the spouse married to the member on29-the date of the member's death or (b) the spouse or former spouse of the30-member if survivorship rights are provided under a qualified domestic31-LB295-2025-LB295-2025--86--relations order filed with the board pursuant to the Spousal Pension1-Rights Act. The spouse or former spouse shall supersede the spouse2-married to the member on the date of the member's death as provided under3-a qualified domestic relations order. If the benefits payable to the4-spouse or former spouse under a qualified domestic relations order are5-less than the value of benefits entitled to the surviving spouse, the6-spouse married to the member on the date of the member's death shall be7-the surviving spouse for the balance of the benefits;8-(37)(a) (37) Termination of employment occurs on the date on which9-the agency which employs the member determines that the member's10-employer-employee relationship with the State of Nebraska is dissolved.11-The agency which employs the member shall notify the board of the date on12-which such a termination has occurred. 13-(b) Termination of employment does not occur if an employee whose14-employer-employee relationship with the State of Nebraska is dissolved15-enters into an employer-employee relationship with the same or another16-agency of the State of Nebraska and there are less than one hundred17-twenty days between the date when the employee's employer-employee18-relationship ceased with the state and the date when the employer-19-employee relationship commenced with the same or another agency.20-(c) It is the responsibility of the employer that is involved in the21-termination of employment to notify the board of such change in22-employment and provide the board with such information as the board deems23-necessary. 24-(d) If the board determines that termination of employment has not25-occurred and a retirement benefit has been paid to a member of the26-retirement system pursuant to section 84-1321, the board shall require27-the member who has received such benefit to repay the benefit to the28-retirement system unless the board determines that all or any portion of29-such benefit was the result of an inadvertent overpayment; and30-(38) Vesting credit means credit for years, or a fraction of a year,31-LB295-2025-LB295-2025--87--of participation in another Nebraska governmental plan for purposes of1-determining vesting of the employer account. 2-Sec. 20. Section 84-1307, Reissue Revised Statutes of Nebraska, is3-amended to read: 4-84-1307 (1) The membership of the retirement system shall be5-composed of all persons who are or were employed by the State of Nebraska6-and who maintain an account balance with the retirement system.7-(2) The following employees of the State of Nebraska are authorized8-to participate in the retirement system: (a) All permanent full-time9-employees who have attained the age of eighteen years shall begin10-participation in the retirement system upon employment; and (b) all11-permanent part-time employees who have attained the age of eighteen years12-may exercise the option to begin participation in the retirement system13-within the first thirty days of employment. An employee who exercises the14-option to begin participation in the retirement system pursuant to this15-section shall remain in the retirement system until his or her16-termination of employment or retirement, regardless of any change of17-status as a permanent or temporary employee. 18-(3) No employee shall be authorized to participate in the retirement19-system provided for in the State Employees Retirement Act unless the20-employee is a United States citizen or is lawfully present in the United21-States. The employing state agency and the employee shall maintain at22-least one of the following documents , which shall be unexpired , if23-applicable to the particular document or which has an expiration date24-that has been extended by the United States Department of Homeland25-Security or the United States Citizenship and Immigration Services so26-that such document is still valid, to demonstrate United States27-citizenship or lawful presence in the United States as of the employee's28-date of hire and produce any such document so maintained upon request of29-the retirement board or the Nebraska Public Employees Retirement Systems:30-(a) A state-issued driver's license; 31-LB295-2025-LB295-2025--88--(b) A state-issued identification card; 1-(c) A state-issued motor vehicle learner's permit;2-(d) (c) A certified copy of a birth certificate or delayed birth3-certificate issued in any state, territory, or possession of the United4-States; 5-(e) (d) A Consular Report of Birth Abroad issued by the United6-States Department of State; 7-(f) (e) A United States passport; 8-(g) (f) A foreign passport with a United States visa;9-(h) (g) A United States Certificate of Naturalization;10-(i) (h) A United States Certificate of Citizenship;11-(j) (i) A tribal certificate of Native American blood or similar12-document; 13-(k) (j) A United States Citizenship and Immigration Services14-Employment Authorization Document, Form I-766; 15-(l) (k) A United States Citizenship and Immigration Services16-Permanent Resident Card, Form I-551; or 17-(m) (l) Any other document issued by the United States Department of18-Homeland Security or the United States Citizenship and Immigration19-Services granting employment authorization in the United States and20-approved by the retirement board. 21-(4) For purposes of this section, (a) permanent full-time employees22-includes employees of the Legislature or Legislative Council who work23-one-half or more of the regularly scheduled hours during each pay period24-of the legislative session and (b) permanent part-time employees includes25-employees of the Legislature or Legislative Council who work less than26-one-half of the regularly scheduled hours during each pay period of the27-legislative session. 28-(5)(a) Within the first one hundred eighty days of employment, a29-full-time employee may apply to the board for vesting credit for years of30-participation in another Nebraska governmental plan, as defined by31-LB295-2025-LB295-2025--89--section 414(d) of the Internal Revenue Code. During the years of1-participation in the other Nebraska governmental plan, the employee must2-have been a full-time employee, as defined in the Nebraska governmental3-plan in which the credit was earned. The board may adopt and promulgate4-rules and regulations governing the assessment and granting of vesting5-credit. 6-(b) If the contributory retirement plan or contract let pursuant to7-section 48-609, as such section existed prior to January 1, 2018, is8-terminated, employees of the Department of Labor who are active9-participants in such contributory retirement plan or contract on the date10-of termination of such plan or contract shall be granted vesting credit11-for their years of participation in such plan or contract.12-(6) Any employee who qualifies for membership in the retirement13-system pursuant to this section may not be disqualified for membership in14-the retirement system solely because such employee also maintains15-separate employment which qualifies the employee for membership in16-another public retirement system, nor may membership in this retirement17-system disqualify such an employee from membership in another public18-retirement system solely by reason of separate employment which qualifies19-such employee for membership in this retirement system.20-(7) State agencies shall ensure that employees authorized to21-participate in the retirement system pursuant to this section shall22-enroll and make required contributions to the retirement system23-immediately upon becoming an employee. Information necessary to determine24-membership in the retirement system shall be provided by the employer.25-Sec. 21. Section 84-1322, Reissue Revised Statutes of Nebraska, is26-amended to read: 27-84-1322 (1) Prior to January 1, 2020, except as otherwise provided28-in this section, a member of the retirement system who has a five-year29-break in service shall upon reemployment be considered a new employee30-with respect to the State Employees Retirement Act and shall not receive31-LB295-2025-LB295-2025--90--credit for service prior to his or her reemployment date.1-(2)(a) A member who ceases to be an employee before becoming2-eligible for retirement under section 84-1317 and again becomes a3-permanent full-time or permanent part-time state employee prior to having4-a five-year break in service shall immediately be reenrolled in the5-retirement system and resume making contributions. For purposes of6-vesting employer contributions made prior to and after reentry into the7-retirement system under subsection (3) of section 84-1321, years of8-participation include years of participation prior to such employee's9-original termination. For a member who is not vested and has received a10-termination benefit pursuant to section 84-1321, the years of11-participation prior to such employee's original termination shall be12-limited in a ratio equal to the amount that the member repays divided by13-the termination benefit withdrawn pursuant to section 84-1321. This14-subsection shall apply whether or not the person was a state employee on15-April 20, 1986, or July 17, 1986. 16-(b) The reemployed member may repay the value of, or a portion of17-the value of, the termination benefit withdrawn pursuant to section18-84-1321. A reemployed member who elects to repay all or a portion of the19-value of the termination benefit withdrawn pursuant to section 84-132120-shall repay the actual earnings on such value. Repayment of the21-termination benefit shall commence within three years after reemployment22-and shall be completed within five years after reemployment or prior to23-termination of employment, whichever occurs first, through (i) direct24-payments to the retirement system, (ii) installment payments made25-pursuant to a binding irrevocable payroll deduction authorization made by26-the member, (iii) an eligible rollover distribution as provided under the27-Internal Revenue Code, or (iv) a direct rollover distribution made in28-accordance with section 401(a)(31) of the Internal Revenue Code.29-(c) The value of the member's forfeited employer account or employer30-cash balance account, as of the date of forfeiture, shall be restored in31-LB295-2025-LB295-2025--91--a ratio equal to the amount of the benefit that the member has repaid1-divided by the termination benefit received. The employer account or2-employer cash balance account shall be restored first out of the current3-forfeiture amounts and then by additional employer contributions.4-(3) For a member who retired pursuant to section 84-1317 and becomes5-a permanent full-time employee or permanent part-time employee with the6-state more than one hundred twenty days after his or her retirement date,7-the member shall continue receiving retirement benefits. Such a retired8-member or a retired member who received a lump-sum distribution of his or9-her benefit shall be considered a new employee as of the date of10-reemployment and shall not receive credit for any service prior to the11-member's retirement for purposes of the act. 12-(4) A member who is reinstated as an employee pursuant to a13-grievance or appeal of his or her termination by the state shall be a14-member upon reemployment and shall not be considered to have a break in15-service for such period of time that the grievance or appeal was pending.16-(5) Beginning January 1, 2020, if a contributing member of the17-retirement system ceases to be an employee and returns to service in any18-capacity with the state prior to having a one-hundred-twenty-day break in19-service, the member: 20-(a) Shall not be deemed to have had a bona fide separation of21-service; 22-(b) Shall be immediately reenrolled in: 23-(i) The defined contribution benefit if the member was contributing24-to the defined contribution benefit prior to ceasing employment; or25-(ii) The cash balance benefit in which the member was participating26-prior to ceasing employment if the member was contributing to the cash27-balance benefit prior to ceasing employment; 28-(c) Shall immediately resume making contributions;29-(d) Shall make up any missed contributions based upon services30-rendered and compensation received; 31-LB295-2025-LB295-2025--92--(e) Shall have all distributions from the retirement system1-canceled; and 2-(f) Shall repay the gross distributions from the retirement system3-unless the board determines that all or any portion of such gross4-distributions were the result of an inadvertent overpayment.5-(6)(a) Beginning January 1, 2020, if a contributing member of the6-retirement system ceases to be an employee and returns to permanent full-7-time or permanent part-time service in any capacity with the state after8-having a one-hundred-twenty-day break in service, the member:9-(i) Shall be immediately reenrolled in: 10-(A) The defined contribution benefit if the member was contributing11-to the defined contribution benefit prior to ceasing employment; or12-(B) The cash balance benefit in which the member was participating13-prior to ceasing employment if the member was contributing to the cash14-balance benefit prior to ceasing employment; 15-(ii) Shall immediately resume making contributions;16-(iii) Shall continue receiving any annuity elected after the member17-ceased employment and before the member was reemployed; and18-(iv) Shall be prohibited from taking any distributions from the19-retirement system until the employee again terminates employment with the20-state. 21-(b) For the purposes of vesting employer contributions made prior to22-and after reentry into the retirement system, the member's years of23-participation prior to the date the member originally ceased employment24-and the years of participation after the member is reenrolled in the25-retirement system shall be included as years of participation, except26-that if the member is not vested on the date the member originally ceased27-employment and has taken a distribution, the years of participation prior28-to the date the member originally ceased employment shall be limited in a29-ratio equal to the value of the distribution that the member repays30-divided by the total value of the distribution taken as described in31-LB295-2025-LB295-2025--93--subdivision (6)(c) of this section. 1-(c) A reemployed member may repay all or a portion of the value of a2-distribution except for an annuity elected after the member ceased3-employment and before the member was reemployed. Repayment of such a4-distribution shall commence within three years after reemployment and5-shall be completed within five years after reemployment or prior to the6-member again ceasing employment, whichever occurs first, through (i)7-direct payments to the retirement system, (ii) installment payments made8-pursuant to a binding irrevocable payroll deduction authorization made by9-the member, (iii) an eligible rollover distribution as provided under the10-Internal Revenue Code, or (iv) a direct rollover distribution made in11-accordance with section 401(a)(31) of the Internal Revenue Code. If the12-member fails to repay all of the value of such a distribution prior to13-the member again ceasing employment, the member shall be forever barred14-from repaying the value of such a distribution taken between the periods15-of employment. The value of the member's forfeited employer account or16-employer cash balance account, as of the date of forfeiture, shall be17-restored in a ratio equal to the amount of the distribution repaid by the18-member divided by the amount of the distribution taken. The employer19-account or employer cash balance account shall be restored first out of20-the current forfeiture amounts and then by additional employer21-contributions. 22-Sec. 22. Section 84-1502, Reissue Revised Statutes of Nebraska, is23-amended to read: 24-84-1502 (1) Within thirty days after its appointment, the Public25-Employees Retirement Board shall meet and select a chairperson and26-secretary. Thereafter, the chairperson and the secretary shall be elected27-in January of each year. 28-(2) The board shall meet upon call of the chairperson , upon the call29-of the vice-chairperson, or upon the request of three members of the30-board filed with the board office. Meetings of the board shall be held in31-LB295-2025-LB295-2025--94--this state and may be held by telecommunication equipment if the1-requirements of the Open Meetings Act are met. 2-(3) The members of the board, except the state investment officer,3-shall be paid seventy-five dollars per diem for attendance at any meeting4-of the board or for any travel to or from any meeting of the board if5-such travel occurs on a different day than a board meeting. All , and all6-members shall be reimbursed for expenses incurred in connection with the7-performance of their duties as board members , including mileage, as8-provided in sections 81-1174 to 81-1177. 9-Sec. 23. Section 84-1504, Reissue Revised Statutes of Nebraska, is10-amended to read: 11-84-1504 (1) The Public Employees Retirement Board, on behalf of the12-state, may contract with any individual to defer a portion of such13-individual's compensation or with the Legislative Council to defer any14-other amount that the Legislative Council agrees to credit to an15-individual's account pursuant to section 457 of the Internal Revenue16-Code. 17-(2) The compensation to be deferred at the election of the18-individual and any other amount credited on behalf of such individual by19-the Legislative Council shall not exceed the total compensation to be20-received by the individual from the employer or exceed the limits21-established by the Internal Revenue Code for such a plan.22-(3) The deferred compensation program shall serve in addition to but23-not be a part of any existing retirement or pension system provided for24-state or county employees or any other benefit program.25-(4) Any compensation deferred at the election of the individual26-under such a deferred compensation plan shall continue to be included as27-regular compensation for the purpose of computing the retirement,28-pension, or social security contributions made or benefits earned by any29-employee. 30-(5) Any sum so deferred shall not be included in the computation of31-LB295-2025-LB295-2025--95--any federal or state taxes withheld on behalf of any such individual.1-(6) The state, the board, the state investment officer, the agency,2-or the county shall not be responsible for any investment results entered3-into by the individual in the deferred compensation agreement.4-(7) Nothing in this section shall in any way limit, restrict, alter,5-amend, invalidate, or nullify any deferred compensation plan previously6-instituted by any instrumentality or agency of the State of Nebraska, and7-any such plan is hereby authorized and approved. 8-(8) No employee of the state or any political subdivision of the9-state shall be authorized to participate in a deferred compensation plan10-unless the employee is a United States citizen or is lawfully present in11-the United States. The employing state agency or political subdivision of12-the State of Nebraska and the employee shall maintain at least one of the13-following documents , which shall be unexpired , if applicable to the14-particular document or which has an expiration date that has been15-extended by the United States Department of Homeland Security or the16-United States Citizenship and Immigration Services so that such document17-is still valid, to demonstrate United States citizenship or lawful18-presence in the United States as of the employee's date of hire and19-produce any such document so maintained upon request of the Public20-Employees Retirement Board or the Nebraska Public Employees Retirement21-Systems: 22-(a) A state-issued driver's license; 23-(b) A state-issued identification card; 24-(c) A state-issued motor vehicle learner's permit;25-(d) (c) A certified copy of a birth certificate or delayed birth26-certificate issued in any state, territory, or possession of the United27-States; 28-(e) (d) A Consular Report of Birth Abroad issued by the United29-States Department of State; 30-(f) (e) A United States passport; 31-LB295-2025-LB295-2025--96--(g) (f) A foreign passport with a United States visa;1-(h) (g) A United States Certificate of Naturalization;2-(i) (h) A United States Certificate of Citizenship;3-(j) (i) A tribal certificate of Native American blood or similar4-document; 5-(k) (j) A United States Citizenship and Immigration Services6-Employment Authorization Document, Form I-766; 7-(l) (k) A United States Citizenship and Immigration Services8-Permanent Resident Card, Form I-551; or 9-(m) (l) Any other document issued by the United States Department of10-Homeland Security or the United States Citizenship and Immigration11-Services granting employment authorization in the United States and12-approved by the Public Employees Retirement Board.13-(9) For purposes of this section, individual means (a) any state14-employee, whether employed on a permanent or temporary basis, full-time15-or part-time, (b) a person under contract providing services to the state16-who is not employed by the University of Nebraska or any of the state17-colleges or community colleges and who has entered into a contract with18-the state to have compensation deferred prior to August 28, 1999, and (c)19-any county employee designated as a permanent part-time or full-time20-employee or elected official whose employer does not offer a deferred21-compensation plan and who has entered into an agreement pursuant to22-section 48-1401. 23-Sec. 24. Section 84-1511, Reissue Revised Statutes of Nebraska, is24-amended to read: 25-84-1511 (1) For purposes of this section: 26-(a) Leave with pay means time off paid by the employer and does not27-mean vacation, sick, personal, or compensatory time; and28-(b) Session means an in-person training or live-broadcast webinar29-but does not include information that can be accessed at any time via30-electronic means unless the information accessed via electronic means31-LB295-2025-LB295-2025--97--is: . 1-(i) In connection with any retirement-planning session provided by2-the Public Employees Retirement Board; 3-(ii) No longer than four hours; and 4-(iii) Accessed by the member within forty-eight hours after such5-information was made available by the Public Employees Retirement Board.6-(2)(a) The Public Employees Retirement Board shall provide sessions7-for state patrol officers, state employees, judges, county employees, and8-school employees who are members of the retirement systems established9-pursuant to the County Employees Retirement Act, the Judges Retirement10-Act, the School Employees Retirement Act, the Nebraska State Patrol11-Retirement Act, and the State Employees Retirement Act. The sessions12-shall provide information and advice regarding the many changes members13-face upon retirement, including, but not limited to, changes in physical14-and mental health, housing, family life, leisure activity, and retirement15-income. 16-(b) The sessions shall be available to any member who has satisfied17-the vesting requirements under the retirement system in which the member18-participates. 19-(c) The sessions shall include information on the federal and state20-income tax consequences of the various annuity or retirement benefit21-options available to retirement system members, information on social22-security benefits, information on various local, state, and federal23-government programs and programs in the private sector designed to assist24-elderly persons, and information and advice the board deems valuable in25-assisting retirement system members in the transition from public26-employment to retirement. 27-(d) Beginning September 1, 2024, as provided pursuant to section28-79-9,117, the board shall also provide the sessions described in this29-subsection to school employees who are members of any retirement system30-established pursuant to the Class V School Employees Retirement Act.31-LB295-2025-LB295-2025--98--(3) The board shall work with the Department of Health and Human1-Services, the personnel division of the Department of Administrative2-Services, employee groups, and any other governmental agency, including3-political subdivisions or bodies whose services or expertise may enhance4-the development or implementation of the sessions. 5-(4)(a)(i) Each employer participating in the Retirement System for6-Nebraska Counties or the State Employees Retirement System of the State7-of Nebraska shall provide each member leave with pay to attend up to8-three days of sessions or up to twenty-four hours of sessions.9-(ii) Each employer participating in the Nebraska Judges Retirement10-System, the School Employees Retirement System of the State of Nebraska,11-or the Nebraska State Patrol Retirement System shall provide each member12-leave with pay to attend up to two days of sessions or up to sixteen13-hours of sessions. 14-(b) Leave authorized pursuant to subdivision (4)(a) of this section15-may only be used to attend sessions that occur during the employee's16-normal work day. 17-(c) A member may choose to attend more sessions than the leave18-authorized pursuant to subdivision (4)(a) of this section, but leave to19-attend such additional sessions shall be at the expense of the member and20-shall be at the discretion of the employer. 21-(5) Funding to cover the expenses of a session shall be charged back22-to the retirement fund of each plan for which sessions are provided23-pursuant to subsection (2) of this section on a pro rata share based on24-the number of members in each plan, except that a nominal registration25-fee may be charged to each person attending an in-person training session26-to cover the costs for meals, meeting rooms, or other expenses incurred27-that are incident to an in-person training session.28-Sec. 25. (1)(a) Except as otherwise provided in this section, no29-person or entity shall include any name, logo, symbol, or similar name,30-logo, or symbol of any of the following in a written solicitation for any31-LB295-2025-LB295-2025--99--financial product or service directed to a member of any Nebraska state1-public retirement system without the consent of the Public Employees2-Retirement Board: 3-(i) The Public Employees Retirement Board; 4-(ii) The Nebraska Public Employees Retirement Systems;5-(iii) The School Employees Retirement System of the State of6-Nebraska; 7-(iv) Any retirement system for a Class V school;8-(v) The Retirement System for Nebraska Counties;9-(vi) The State Employees Retirement System; 10-(vii) The Nebraska Judges Retirement System; or11-(viii) The Nebraska State Patrol Retirement System.12-(b) Any written solicitation for any financial product or service13-directed to a member of any Nebraska state public retirement system shall14-clearly and conspicuously state that the person or entity is not15-sponsored by or affiliated with the Public Employees Retirement Board,16-the Nebraska Public Employees Retirement Systems, or any retirement17-system specified in subdivisions (1)(a)(iii) through (viii) of this18-section. Any such statement shall be in close proximity to and in larger19-font size than the first use and any prominent uses of the name, logo, or20-symbol in the written solicitation, including on an envelope or through21-an envelope window containing the written solicitation.22-(2) No person or entity shall use the name of the Public Employees23-Retirement Board, the Nebraska Public Employees Retirement Systems, any24-retirement system specified in subdivisions (1)(a)(iii) through (viii) of25-this section, or any name similar to the Public Employees Retirement26-Board, the Nebraska Public Employees Retirement Systems, or any27-retirement system specified in subdivisions (1)(a)(iii) through (viii) of28-this section, in any written solicitation for any financial product or29-service directed to any member of any Nebraska state public retirement30-system if such use could cause a reasonable person to be confused,31-LB295-2025-LB295-2025--100--mistaken, or deceived initially or otherwise as to either of the1-following: 2-(a) Any sponsorship, affiliation, connection, or association with3-the person who or entity that initiated or sent the written solicitation4-and the Public Employees Retirement Board, the Nebraska Public Employees5-Retirement Systems, or any retirement system specified in subdivisions6-(1)(a)(iii) through (viii) of this section; 7-(b) Any approval or endorsement of the person who or entity that8-initiated or sent the written solicitation by the Public Employees9-Retirement Board, the Nebraska Public Employees Retirement Systems, or10-any retirement system specified in subdivisions (1)(a)(iii) through11-(viii) of this section; or 12-(c) Any approval or endorsement of any product or service provided13-or offered by the person who or entity that initiated or sent the written14-solicitation by the Public Employees Retirement Board, the Nebraska15-Public Employees Retirement Systems, or any retirement system specified16-in subdivisions (1)(a)(iii) through (viii) of this section.17-Sec. 26. Original sections 23-2320, 42-1102, 79-902, 79-904.01,18-79-915, 79-956, 79-978, 79-9,103, 79-9,106, 79-9,117, 79-9,118, 81-2014,19-81-2016, 81-2017, 84-1301, 84-1307, 84-1322, 84-1502, 84-1504, and20-84-1511, Reissue Revised Statutes of Nebraska, and sections 23-2301,21-23-2306, 24-701, and 24-703.01, Revised Statutes Cumulative Supplement,22-2024, are repealed. 23-LB295-2025-LB295-2025--101-
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