BY REPRESENTATIVES Dean, K. Alexander, G. Berry, George, S. Johnson, June, Miller, Nichol, Saliman, Tucker, Allen, Bacon, Lawrence, Mace, Paschall, Reeser, Sullivant, and Taylor;
also SENATORS Tebedo, B. Alexander, Feeley,
Powers, and Reeves.
CONCERNING THE TAXABILITY OF SURVIVOR BENEFITS PAYABLE
TO THE SURVIVORS OF A MEMBER OF THE STATEWIDE DEATH AND DISABILITY
PLAN.
Be it enacted by the General Assembly of the State
of Colorado:
SECTION 1. Part
8 of article 31 of title 31, Colorado Revised Statutes, is amended
BY THE ADDITION OF A NEW SECTION to read:
3131807.5. Death of member
line of duty survivor benefits.
(1) IF A MEMBER WHO IS NOT ELIGIBLE FOR THE NORMAL
RETIREMENT PENSION DESCRIBED IN SECTION 3131403 DIES
WHILE IN ACTIVE SERVICE AS THE DIRECT AND PROXIMATE RESULT OF
A PERSONAL INJURY SUSTAINED WHILE PERFORMING OFFICIAL DUTIES OR
AS A RESULT OF AN OCCUPATIONAL DISEASE ARISING OUT OF AND IN THE
COURSE OF THE MEMBER'S EMPLOYMENT AND LEAVES A SURVIVING SPOUSE
OR DEPENDENT CHILDREN, OR BOTH, ONE OF THE FOLLOWING SURVIVOR
BENEFITS SHALL BE PAID, UNLESS THE MEMBER IS ELIGIBLE FOR A NORMAL
RETIREMENT PENSION UNDER AN OLD HIRE PENSION ESTABLISHED PURSUANT
TO ARTICLE 30.5 OF THIS TITLE THAT PROVIDES FOR POSTRETIREMENT
SURVIVOR BENEFITS TO A SPOUSE AND DEPENDENT CHILDREN IN THE EVENT
THE MEMBER DIES IN ACTIVE SERVICE WHILE ELIGIBLE FOR NORMAL RETIREMENT:
(a) WHEN THERE IS A SURVIVING SPOUSE AND
NO DEPENDENT CHILDREN, THE MONTHLY BENEFIT SHALL BE TWENTYFIVE
PERCENT OF THE MONTHLY BASE SALARY PAID TO SUCH MEMBER IMMEDIATELY
PRECEDING DEATH PLUS ONEHALF OF ONE PERCENT OF SUCH SALARY
FOR EACH YEAR OF THE MEMBER'S ACTIVE SERVICE IN EXCESS OF TWENTYFIVE
YEARS, BUT SUCH BENEFIT SHALL NOT EXCEED THIRTYFIVE PERCENT
OF SUCH SALARY.
(b) WHEN THERE IS A SURVIVING SPOUSE AND
ONE DEPENDENT CHILD, THE MONTHLY BENEFIT SHALL BE FORTY PERCENT
OF THE MONTHLY BASE SALARY PAID TO SUCH MEMBER IMMEDIATELY PRECEDING
DEATH.
(c) WHEN THERE IS A SURVIVING SPOUSE AND
TWO OR MORE DEPENDENT CHILDREN, THE MONTHLY BENEFIT SHALL BE FIFTY
PERCENT OF THE MONTHLY BASE SALARY PAID TO SUCH MEMBER IMMEDIATELY
PRECEDING DEATH.
(d) WHEN THERE IS NO SURVIVING SPOUSE
AND THREE OR MORE DEPENDENT CHILDREN, THE MONTHLY BENEFIT SHALL
BE FIFTY PERCENT OF THE MONTHLY BASE SALARY PAID TO EACH MEMBER
IMMEDIATELY PRECEDING DEATH.
(e) WHEN THERE IS NO SURVIVING SPOUSE
AND TWO DEPENDENT CHILDREN, THE MONTHLY BENEFIT SHALL BE FORTY
PERCENT OF THE MONTHLY BASE SALARY PAID TO SUCH MEMBER IMMEDIATELY
PRECEDING DEATH.
(f) WHEN THERE IS NO SURVIVING SPOUSE
AND ONE DEPENDENT CHILD, THE MONTHLY BENEFIT SHALL BE TWENTYFIVE
PERCENT OF THE MONTHLY BASE SALARY PAID TO SUCH MEMBER IMMEDIATELY
PRECEDING DEATH.
(2) THE BOARD SHALL PROMULGATE RULES THAT
SPECIFY STANDARDS AND ESTABLISH PROCEDURES FOR DETERMINING WHETHER
A MEMBER'S DEATH IS THE DIRECT AND PROXIMATE RESULT OF A PERSONAL
INJURY SUSTAINED WHILE PERFORMING OFFICIAL DUTIES OR AN OCCUPATIONAL
DISEASE ARISING OUT OF AND IN THE COURSE OF A MEMBER'S EMPLOYMENT
AND, IN THE CASE OF A LINE OF DUTY DEATH, WHETHER ANY OF THE EXCEPTIONS
SPECIFIED IN SECTION 101 (h) (2) OF THE FEDERAL "INTERNAL
REVENUE CODE OF 1986", AS AMENDED, ARE APPLICABLE. THE PROCEDURES
ESTABLISHED BY THE BOARD MAY INCLUDE THE APPOINTMENT OF HEARING
OFFICERS TO CONDUCT HEARINGS.
(3) (a) THE BOARD SHALL PROMULGATE
RULES THAT SPECIFY THE METHOD OF REVIEWING EXISTING SURVIVOR BENEFIT
AWARDS TO:
(I) DETERMINE WHETHER A MEMBER'S DEATH
WAS THE DIRECT AND PROXIMATE RESULT OF A PERSONAL INJURY SUSTAINED
WHILE PERFORMING OFFICIAL DUTIES OR AS A RESULT OF AN OCCUPATIONAL
DISEASE ARISING OUT OF AND IN THE COURSE OF THE MEMBER'S EMPLOYMENT;
(II) DETERMINE, IN THE CASE OF LINEOFDUTY
DEATHS OCCURRING AFTER DECEMBER 31, 1996, WHETHER ANY OF THE EXCEPTIONS
SPECIFIED IN SECTION 101 (h) (2) OF THE FEDERAL "INTERNAL
REVENUE CODE OF 1986", AS AMENDED, ARE APPLICABLE;
(III) ESTABLISH PROCEDURES FOR MAKING
SUCH DETERMINATIONS, INCLUDING THE APPOINTMENT OF HEARING OFFICERS
TO CONDUCT HEARINGS.
(b) THE DETERMINATIONS MADE BY THE BOARD
PURSUANT TO THIS SUBSECTION (3) SHALL BE MADE ON THE BASIS OF
THE MEDICAL EVIDENCE THAT WAS PREVIOUSLY SUBMITTED IN CONNECTION
WITH THE APPLICATION FOR SURVIVOR BENEFITS AND OTHER RELEVANT
NONTESTIMONIAL EVIDENCE.
(c) ANY DECISION MADE BY THE BOARD TO
CHANGE AN EXISTING SURVIVOR BENEFIT AWARD TO AN ONDUTY SURVIVOR
BENEFIT UNDER THIS SUBSECTION (3) SHALL OPERATE ON A PROSPECTIVE
BASIS FROM THE DATE OF THE BOARD'S DECISION.
SECTION 2. 3131501
(6) (b) (IV), Colorado Revised Statutes, is amended to read:
3131501. Withdrawal into
statewide money purchase plan. (6) (b) (IV) If
members who have made such an election die or become disabled
prior to termination of employment, neither they nor their survivors
shall be eligible for benefits under the statewide defined benefit
plan, but rather they shall be limited to those benefits provided
in sections 3131803, and
3131807, AND 3131807.5.
SECTION 3. 3131601
(1) (b) (II), Colorado Revised Statutes, is amended to read:
3131601. Withdrawn local
alternative pension plans creation administration.
(1) (b) An employer that withdraws from the statewide
defined benefit plan prior to January 2, 1988, as provided in
this subsection (1) shall establish and maintain a locally administered
and financed alternative pension plan subject to the following:
(II) The members of such plan hired before,
on, or after April 7, 1978, shall be covered by the provisions
of sections 3131803, and
3131807, AND 3131807.5 in lieu of any
other defined disability and preretirement death benefits.
SECTION 4. 3131808,
Colorado Revised Statutes, is amended to read:
3131808. Reduction of survivor
benefits. (1) The benefits
payable under section
SECTIONS 3131807 AND 3131807.5 to the
surviving spouse and dependent children of any member, who at
the time of the member's death was a member of a money purchase
plan established under this article or article 30.5 of this title,
including any department chief, who at the time of the chief's
death had been exempted from the statewide defined benefit plan
as permitted by section 3131401 (4), shall be reduced
by an amount that is the actuarial equivalent of the benefits
such surviving spouse and dependent children receive from the
money purchase plan, whether the benefits received from the money
purchase plan are paid on a periodic basis or in a lump sum.
No such reduction shall exceed the actuarial equivalent of money
purchase plan benefits if such benefits had been funded at the
same rate of contributions specified in section 3131402
(1) and (2) as are required for benefits under section 3131403.
(2) The benefits payable under this
section SECTIONS 3131807
AND 3131807.5 to the surviving spouse and dependent
children of any member who are also receiving payments from the
member's separate retirement account pursuant to section 3131406
shall be reduced by an amount that is the actuarial equivalent
of the benefits such surviving spouse and dependent children receive
from the separate retirement account, whether the benefits received
from the account are paid on a periodic basis or in a lump sum.
SECTION 5. Effective
date. This act shall take effect sixty days after
the date on which the fire and police pension association receives
a letter from the internal revenue service containing a favorable
ruling to the effect that benefits paid to the survivors of deceased
police officers or firefighters as a result of onduty personal
injuries or servicerelated or occupational diseases under
this act are excludable from the gross income of the recipients
pursuant to section 104 (a) (1) of the federal "Internal
Revenue Code of 1986", as amended, if such ruling is received
by December 31, 1999.
SECTION 6. Safety
clause. The general assembly hereby finds, determines,
and declares that this act is necessary for the immediate preservation
of the public peace, health, and safety.
____________________________ ____________________________
Charles E. Berry Tom Norton
SPEAKER OF THE HOUSE PRESIDENT OF
OF REPRESENTATIVES THE SENATE
____________________________ ____________________________
Judith M. Rodrigue Patricia K. Dicks
CHIEF CLERK OF THE HOUSE ASSISTANT SECRETARY OF
OF REPRESENTATIVES THE SENATE
APPROVED________________________________________
_________________________________________
Roy Romer
GOVERNOR OF THE STATE
OF COLORADO