2014 Tennessee Code
Title 8 - Public Officers And Employees
Chapter 36 - Retirement Benefits
Part 9 - Hybrid Retirement Plan for State Employees and Teachers
§ 8-36-919 - Membership in the hybrid plan for employees of political subdivisions electing to participate.

(a) A political subdivision that is not otherwise participating under any of the plans afforded under chapters 34-37 of this title may, by resolution legally adopted and approved by its chief governing body and in accordance with the procedure set out in § 8-35-201, authorize its employees in all of its departments or instrumentalities to become eligible to participate in the hybrid plan. Membership in the hybrid plan for employees of political subdivisions that are admitted into the hybrid plan pursuant to this subsection shall be:

(1) Optional for all employees in the service of the political subdivision on the date the approval is given; and

(2) Mandatory for all eligible employees entering the service of the political subdivision thereafter; provided, however, that membership shall not be required for any part-time employee who would otherwise be covered under the provisions of this part, or for any employee who has optional membership in the retirement system pursuant to chapters 34-37 of this title. Any election made by an employee to become a participant shall be irrevocable and such employee shall thereafter be subject to the terms and conditions of the hybrid plan.

(b) Any political subdivision electing to participate in the hybrid plan pursuant to this section shall participate in the provisions of the plan as they exist for state employees on the date of participation or at any other given time pursuant to any changes made pursuant to §§ 8-36-921 and 8-36-922; provided, however, that any subsequent changes that increase the liability of a participating political subdivision within the meaning of Article II, § 24 of the Tennessee Constitution shall not apply to the political subdivision unless the chief governing body of the political subdivision agrees to such changes and accepts the liability therefore. Notwithstanding this subsection (b), the following provisions shall remain optional to political subdivisions:

(1) Part-time, seasonal, or temporary employee service credit in accordance with § 8-34-621; and

(2) Mandatory retirement in accordance with § 8-36-205.

(c) A political subdivision already participating in the retirement system under one of the additional plans afforded under chapters 34-37 of this title may change from that plan to the hybrid plan on a prospective basis by passage of a resolution pursuant to subsection (a) above. Any such resolution shall set forth the effective date of the change; provided, that the date shall be on the first day of any quarter following a minimum of six (6) months' notice to the retirement system. The actuarial value of accrued benefits earned by employees of the political subdivision prior to the effective date of the change shall remain an enforceable right and may not be reduced or otherwise forfeited except by the consent of the employee or in accordance with § 8-35-124.

(d) Any political subdivision that participates in the hybrid plan shall have the right to change from the hybrid plan to any of the additional plans afforded to the political subdivision under chapters 34-37. Any such change shall be in accordance with and subject to the terms and conditions of §§ 8-35-253 -- 8-35-256. In addition, any political subdivision that participates in the hybrid plan shall be subject to the withdrawal provisions of §§ 8-35-211 and 8-35-218. Benefits accrued under the hybrid plan or under any of the plans adopted pursuant to §§ 8-35-253 -- 8-35-256 shall be in accordance with 26 U.S.C. § 411. Notwithstanding this section or any other law to the contrary, the cost-of-living provisions of § 8-36-701 shall not be deemed an accrued benefit and may be subject to change pursuant to this section and §§ 8-36-921 and 8-36-922.

(e) Notwithstanding this section or any other law to the contrary, a political subdivision may authorize its county judges to participate in the hybrid plan under the same provisions governing state judges as set forth in this part provided the political subdivision authorizes and pays for the cost of an actuarial study to determine the liability associated with such membership and, following review of the cost of such membership, the chief governing body of the political subdivision passes a resolution authorizing the membership and accepting the liability therefor. In addition, a political subdivision may authorize its county judge to participate in the hybrid plan under the provisions of this subsection (e) without extending retirement coverage to its other employees provided the political subdivision authorizes and pays for the cost of an actuarial study to determine the liability associated with such membership and, following review of the cost of such membership, the chief governing body of the political subdivision passes a resolution authorizing the membership and accepting the liability therefor. The retirement system shall not be liable for the payment of retirement allowances or other payments on account of such membership for which reserves have not been previously created from funds contributed by the political division and/or its county judges. It is the legislative intent that the state shall realize no increased cost as a result of this section. All costs associated with retirement coverage, including administrative costs, shall be the responsibility of the political subdivision.

(f) Notwithstanding this part or any law to the contrary, a political subdivision that extends retirement coverage to its employees under this section may elect to provide its own profit sharing and/or salary reduction plan that is authorized under § 401(k) of the Internal Revenue Code in lieu of participating in the state's profit sharing and/or salary reduction plan established under chapter 25, part 3 of this title; provided, that the political subdivision makes mandatory contributions to such plan on behalf of each of its employees participating in the hybrid plan, regardless of whether the employees make any employee contributions to that plan. The amount of the employer contributions shall be five percent (5%) of the respective employee's salary unless suspended or reduced pursuant to § 8-36-922.