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SPONSOR: Sen. Paradee & Rep. Carson
Rep. Dukes
DELAWARE STATE SENATE
153rd GENERAL ASSEMBLY
SENATE BILL NO. 42
AN ACT TO AMEND TITLE 29 OF THE DELAWARE CODE AND CHAPTER 446 OF VOLUME 84 OF THE LAWS
OF DELAWARE RELATING TO PENSIONS FOR THE STATE JUDICIARY.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
1 Section 1. Amend § 5601, Title 29 of the Delaware Code by making deletions as shown by strike through and
2 insertions as shown by underline as follows:
3 § 5601. State Judiciary Retirement Fund; contributions; use; division of benefits into plans.
4 (a) (1) There shall be established a State Judiciary Retirement Fund, hereinafter referred to as “Fund.” Each
5 member who elects or who has elected the provisions of this chapter and:
6 a. Who was first appointed to the state judiciary before July 1, 1980, and is a member covered by the
7 closed plan, shall contribute $500 to the Fund each year for the first 25 years of service; or
8 b. Who is a member covered by the revised plan before January 1, 2025, [the effective date of this Act]
9 shall contribute to the Fund each year for the first 24 years of service an amount equal to 3% of annual
10 compensation in excess of $6,000 up to the Social Security wage base, and 5% of total compensation in excess of
11 the Social Security wage base. Total compensation during any calendar year in excess of $6,000 may not be
12 exempt from contributions; or
13 c. Who is a member first covered by the revised plan on or after January 1, 2025, [the effective date of
14 this Act], other than an individual who first becomes a member under § 5605(e)(2)b. of this title, shall contribute
15 to the Fund each year for the first 24 years of service an amount equal to 4% 5% of annual compensation in excess
16 of $6,000 up to the Social Security wage base, and 5% of total compensation in excess of the Social Security wage
17 base. Total compensation during any calendar year in excess of $6,000 may not be exempt from contributions.
18 (2) Effective July 1, 1997, employee pension contributions made under this section are not subject to
19 adjustment or recovery after the expiration of 3 full calendar years from December 31 of the year in which the
20 contributions were made unless no contributions were paid during that calendar year.
21 Section 2. Amend § 5605, Title 29 of the Delaware Code by making deletions as shown by strike through and
22 insertions as shown by underline as follows:
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23 § 5605. Acceptance of provisions; result.
24 (a) (1) Each new state judicial officer may accept the provisions of this chapter by 1 of the following:
25 a. Written declaration to that effect within 30 days following the member becoming a state judicial
26 officer. A member first appointed on or after July 1, 1980, is not required to file a written declaration as the
27 member is covered under the revised plan.
28 b. Through the authorization by the member to permit deductions for the contributions provided in § 5601
29 of this title.
30 (2) a. The declaration of acceptance under paragraph (a)(1)a. of this section must be filed with the Secretary of
31 State. If the member accepts the provisions of this chapter through authorization of deductions for contributions under
32 paragraph (a)(1)b. of this section, the member shall thereafter file a written declaration with the Secretary of State.
33 b. On filing of a declaration of acceptance by a state judicial officer or on authorization of deductions for
34 contributions, whichever first occurs, the benefits of this chapter are available to the state judicial officer.
35 c. A declaration of acceptance, or authorization of deductions for the contributions provided in § 5601 of
36 this title, by a member first appointed on or after July 1, 1980, covers the member under the revised plan.
37 (b) A member first appointed before July 1, 1980, may elect to be covered by the revised plan by filing a
38 declaration of acceptance with the Secretary of State. Except as provided under subsection (e) of this section, a member
39 first appointed on or after July 1, 1980, is required to participate in the revised plan as a condition of employment and is not
40 required to file a written declaration or authorization of deductions.
41 (c) Any declaration of acceptance of this chapter or authorization of deductions for the contributions provided in §
42 5601 of this title as provided in subsection (a) of this section constitutes an authorization and direction by the state judicial
43 officer making the declaration or authorization that if a certificate of permanent physical or mental disability of the state
44 judicial officer is filed under § 5602(c) or § 5612(c) of this title, the certificate constitutes, without any further act by the
45 state judicial officer, a resignation by the state judicial officer, effective immediately after the filing of the certificate.
46 (d) A declaration of acceptance filed or authorization of deductions for contributions made under this section is
47 irrevocable.
48 (e) (1) A Justice of the Peace, Commissioner, or Magistrate in Chancery who first qualifies for the State Judicial
49 Pension plan on January 1, 2025, [the effective date of this Act] may, under § 4 of Article XV of the Delaware
50 Constitution, decline participation in the State Judicial Pension Plan and remain in the State Employee’s Pension Plan.
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51 (2)a. A Justice of the Peace, Commissioner, or Magistrate in Chancery who exercises the right under
52 paragraph (e)(1) of this section to decline participation in the State Judicial Pension Plan must do so in writing to the
53 Board by January 31, 2025. a date and in a manner determined by the Pension Administrator.
54 b. A Justice of the Peace, Commissioner, or Magistrate in Chancery who first qualifies for the State
55 Judicial Pension plan on [the effective date of this Act] and who opts to participate in the State Judicial Pension
56 Plan or does not decline participation under paragraph (e)(2)a. of this section shall contribute to the Fund each year
57 for the first 24 years of service after joining the State Judicial Pension Plan at the rate applicable to the Justice of
58 the Peace’s, Commissioner’s, or Magistrate in Chancery’s prior participation in the State Employee’s Pension
59 Plan.
60 c. A member of the state judiciary first covered by the State Judicial Pension Plan under paragraph
61 (e)(2)b. of this section who is subsequently appointed to a different position within the state judiciary shall
62 thereafter contribute for the remaining 24 years of service an amount equal to 5% of annual compensation in
63 excess of $6,000 up to the Social Security wage base, and 5% of total compensation in excess of the Social
64 Security wage base.
65 (3) The exercise of the right under paragraph (e)(1) of this section is irrevocable.
66 (4) A Justice of the Peace, Commissioner, or Magistrate in Chancery who first qualifies for the State Judicial
67 Pension Plan on January 1, 2025, [the effective date of this Act] and elects to be is covered by the State Judicial
68 Pension Plan is entitled to a payout for accrued annual leave in incremental payments over a 5-year period, with the
69 first payout to be completed by January 1, 2026.[the date that is 1 year from the effective date of this Act]. If
70 termination of state service occurs before receiving the full accrued payout, the outstanding amount must be paid on
71 termination.
72 Section 3. Amend Chapter 446, Volume 84 of the Laws of Delaware by making deletions as shown by strike
73 through and insertions as shown by underline as follows:
74 Section 11. This Act takes effect on January 1, 2025. January 26, 2025.
75 Section 4. This Act takes effect on January 26, 2025.
SYNOPSIS
After enactment of Senate Substitute No. 1 to Senate Bill No. 174 of the 152nd General Assembly (Chapter 446 of
Volume 84 of the Laws of Delaware), it was discovered that Senate Substitute No. 1 to Senate Bill No. 174 would, if
implemented, jeopardize the qualified federal tax status of the Delaware Public Employees Retirement System by giving
individuals who are Justices of the Peace, Commissioners of the Superior Court, Family Court, and Court of Common Pleas
(“Commissioners”), and Magistrates in Chancery (“Magistrates”), as of the effective date, an election to participate in the
Judicial Pension Plan at a different rate of pre-tax contribution than presently required for those individuals under the State
Employees’ Pension Plan (3% or 5%, depending on start date). Based on this information, the Board of Pension Trustees
voted unanimously on December 10, 2024, to delay implementation of Senate Substitute No. 1 for Senate Bill No. 174.
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This Act does the following:
(1) Revises § 5601 and 5605 of Title 29 to allow for Justices of the Peace, Commissioners, and Magistrates who
first qualify for the State Judicial Pension Plan on the effective date of this Act to elect to remain in the State Employees’
Pension Plan or participate in the State Judicial Pension Plan at the same pre-tax rate each individual was contributing
under the State Employees’ Pension Plan (3% or 5%).
(2) Sets the mandatory pre-tax contribution rate of any subsequently appointed State judicial officer at 5%. Any
Justice of the Peace, Commissioner, or Magistrate as of the effective date who is appointed to a new position within the
state judiciary after the effective date of this Act will also be subject to the mandatory 5% contribution rate.
(3) Delays the effective date of Senate Substitute No. 1 for Senate Bill No. 174 until January 26, 2025, the
effective date of this Act.
Author: Senator Paradee
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