A BILL TO BE ENTITLED
AN ACT to amend the law affecting retirees returning to work.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 135‑1 is amended by adding a new subdivision to read:
"(14a)	"Normal retirement age" means the age of 60 or older with 25 or more years of creditable service or the age of 65 or older with five or more years of membership service."
SECTION 2.  G.S. 135‑1(20) reads as rewritten:
"(20)	"Retirement"  means:
a.	In the case of a member who has reached normal retirement age, the commencement of a retirement allowance under the provisions of this Article.
b.	In the case of a member who has not yet reached normal retirement age, the commencement of a retirement allowance under the provisions of this Article and a complete separation from active service, with no intent or agreement, express or implied, to return to service, and subject to the requirement that the member shall not render any service, whether part‑time, temporary, substitute, or contractor service, at any time during the total of 25 working days immediately following the effective date of retirement plus the longer of the number of weeks during each of the previous two years in which there were no paid days of employment."
SECTION 3.(a)  Subsection (d) of Section 28.24 of S.L. 1998‑212, as amended by Section 7A.1 of S.L. 2005‑144, reads as rewritten:
"(d)	This section becomes effective January 1,  1999."
SECTION 3.(b)  The introductory language of Section 67 of S.L. 1998‑217, as amended by Section 7A.1 of S.L. 2005‑144, reads as rewritten:
"SECTION 67.  Effective January 1, 1999,  G.S. 135‑3(8)c., as rewritten by Section 28.24(a) of S.L. 1998‑212 reads as rewritten:".
SECTION 3.(c)  Subsection (b) of Section 67.1 of S.L. 1998‑217, as amended by Section 7A.1 of S.L. 2005‑144, reads as rewritten:
"(b)	This section becomes effective January 1,  1999."
SECTION 3.(d)  Subsection (c) of Section 32.25 of S.L. 2001‑424, as amended by Section 7A.1 of S.L. 2005‑144, reads as rewritten:
"SECTION 32.25.(c)  This section becomes effective July 1, 2001."
SECTION 3.(e)  This section becomes effective June 30, 2006.
SECTION 4.  G.S. 135‑3(8)c. reads as rewritten:
"c.	Should a beneficiary who retired on an early or service retirement allowance under this Chapter be reemployed, or otherwise engaged to perform services, by an employer participating in the Retirement System on a part‑time, temporary, interim, or on a fee‑for‑service basis, whether contractual or otherwise, and if such beneficiary earns an amount during the 12‑month period immediately following the effective date of retirement or in any calendar year which exceeds fifty percent (50%) of the reported compensation, excluding terminal payments, during the 12 months of service preceding the effective date of retirement, or twenty thousand dollars ($20,000), whichever is greater, as hereinafter indexed, then the retirement allowance shall be suspended as of the first day of the month following the month in which the reemployment earnings exceed the amount above, for the balance of the calendar year. The retirement allowance of such a beneficiary shall also be suspended as provided in this sub‑subdivision if that beneficiary earns in any one month an amount that exceeds sixty percent (60%) of the average reported monthly compensation, excluding terminal payments, earned during the 12 months of service immediately preceding the effective date of retirement, unless the beneficiary's employment resulting in that monthly amount is for a fixed term of no more than six months and is preceded by at least a six‑month continuous separation from active service following the beneficiary's retirement. The retirement allowance of the beneficiary shall be reinstated as of January 1 of each year following suspension. The amount that may be earned before suspension shall be increased on January 1 of each year by the ratio of the Consumer Price Index to the Index one year earlier, calculated to the nearest tenth of a percent (1/10 of 1%).
The computation of postretirement earnings of a beneficiary under this sub‑subdivision, G.S. 135‑3(8)c., who meets either definition of retirement under G.S. 135‑1(20) and who, before the effective date of reemployment, has not been employed in any capacity with a public school at any time during the total of 25 working days immediately following the effective date of retirement plus the longer of the number of weeks during each of  the previous two years in which there were no paid days of employment for that member, shall not include earnings while the beneficiary is employed to teach in a permanent full‑time or part‑time capacity that exceeds fifty percent (50%) of the applicable workweek in a public school. The Department of Public Instruction shall certify to the Retirement System that a beneficiary is employed to teach by a local school administrative unit under the provisions of this sub‑subdivision and as a retired teacher as the term is defined under the provisions of G.S. 115C‑325(a)(5a).
Beneficiaries employed under this sub‑subdivision are not entitled to any benefits otherwise provided under this Chapter as a result of this period of employment."
SECTION 5.  G.S. 115C‑325(a)(5a) reads as rewritten:
"(5a)	"Retired teacher" means a beneficiary of the Teachers' and State Employees' Retirement System of North Carolina who  meets either definition of retirement under G.S. 135‑1(20), who, before the effective date of reemployment, has not been employed in any capacity  with a public school at any time during the total of 25 working days immediately following the effective date of retirement plus the longer of the number of weeks during each of the previous two years in which there were no paid days of employment for that member, who is determined by a local board of education or a charter school to have had satisfactory performance during the last year of employment by a local board of education or a charter school, and who is employed to teach as provided in G.S. 135‑3(8)c. A retired teacher at a school other than a charter school shall be treated the same as a probationary teacher except that (i) a retired teacher is not eligible for career status and (ii) the performance of a retired teacher who had attained career status prior to retirement shall be evaluated in accordance with a local board of education's policies and procedures applicable to career teachers."
SECTION 6.  Section 29.28(f) of S.L. 2005‑276 reads as rewritten:
"SECTION 29.28.(f)  Subsections (a) and (b) of this section become effective August 1, 2005. Subsection (e) of this section becomes effective November 1, 2005, but does not apply to participants in The University of North Carolina Phased Retirement  Program. The remainder of this section becomes effective June 30, 2005."
SECTION 7.  The University of North Carolina shall establish a normal retirement age for the Optional Retirement Program of either 59½ or 60 years of age and shall limit the University of North Carolina Phased Retirement Program to persons who have reached that normal retirement age.
SECTION 8.  The North Carolina Community College System may establish a phased retirement program for its faculty that functions in a manner similar to The University of North Carolina Phased Retirement Program.
SECTION 9.  This act becomes effective July 1, 2006, but Sections 1 through 5 of this act do not apply to participants in The University of North Carolina Phased Retirement Program or to members of the phased retirement program established for the faculty of the North Carolina Community College System under Section 8 of this act.