Mass. Gen. Laws ch. 32, sec. 21 — MA Code / Part I / Title IV / Chapter 32 / Section 21
Supervision by public employee retirement administration commission
Status: in_force

Section 21. (1) Duties of public employee retirement administration commission. — (a) The public employee retirement administration commission shall prescribe and supervise methods of accounting and recordkeeping for each system maintained under the provisions of this chapter. To ensure the maintenance of accurate and current membership records and payment information, the commission, for any board which fails to submit the requested information upon notice as prescribed in subdivision (5) of section twenty, may send his agents to examine the records and accounts of the board and to direct such action by the board or its employees as may be required to comply with acceptable recordkeeping and accounting standards. The commission shall require each board to keep in convenient form such data as is required for the purpose of valuing the assets, determining the liabilities of the system, making actuarial investigation of the experience of the system, and for promulgating rules and regulations governing the administrative procedures and for maximizing the assets of such system. Such data shall be submitted to the office of the public employee retirement administration commission within such time as he may specify. Each board shall maintain a copy of all collective bargaining agreements which cover the system's members and shall make the agreements available to the commission for review at such time as the commission shall specify. The commission or his agent shall conduct an in-depth field examination of each board at intervals not exceeding three years to ascertain its financial condition, its ability to fulfill its obligations, whether all parties in interest have complied with the laws applicable thereto, and whether the transactions of the board have been in accordance with the rights and equities of those in interest. Whenever the board of any system causes an examination of its financial condition to be made by a certified public accountant or a public accountant selected by said board, the board shall immediately, upon the employment of such person, file his name and address with the commission, and such person shall, within ten days after making the report of such examination to the board of such system, file a certified copy thereof with the commission. Any certified public accountant selected by said board shall conduct such examination in accordance with such procedures as the commission shall establish. The commission may, in his discretion, accept the examination so made, or cause an examination to be made pursuant to this paragraph. An examination conducted by a certified public accountant or a public accountant selected by said board, which is accepted by the commission, shall be deemed to be the examination required by this paragraph. (b) Each such system, except any system appropriating funds pursuant to a funding schedule adopted in accordance with the provisions of section twenty-two C or twenty-two D as the case may be, shall be credited in its financial accounts with its investments having a fixed term and rate, if amply secured in the judgment of the public employee retirement administration commission and not in default as to principal or interest, as follows: if purchased at par, with the par value; if purchased above or below par, with an amortized value so determined as to yield approximately the effective rate of interest at which the purchase was made and to bring the value to par at the date of maturity or at the date the security is first callable at par if prior thereto; provided, however, that the purchase price of any such security shall not be taken at a higher value than its actual market value when purchased; and provided, further, that the value of any security on the date of any valuation thereof shall not be taken at a higher value than its callable value, if any, on such date. The public employee retirement administration commission shall have full power and discretion in determining the methods of calculating values according to the foregoing rules, and the values found by him in accordance with such methods shall be final and binding; provided, however, that any investments in United States savings bonds purchased on a discount basis may be credited at their redemption value or at their amortized value, as the board shall determine. The public employee retirement administration commission shall also have full power and discretion in determining the method of calculating the values of any other investments of any system; provided, however, that the calculation of such values shall be consistent with methods prescribed by the Government Accounting Standards Board or methods allowed by the Employee Retirement Income Security Act, so-called. (c) The public employee retirement administration commission or his agent shall, for the purpose of carrying out the provisions of this section, have access to all the securities, books and papers of any such system and may summon and administer oath to and examine any person relative to the financial affairs, transactions and condition of the system. The commission shall preserve in a permanent form a full record of the proceedings of each examination of a system and the results thereof. Upon the completion of such examination, verification and valuation, the commission shall make a report in writing of his findings to the board, and shall send a copy thereof to the governor and state treasurer, the county commissioners, the mayor, the board of selectmen, the Massachusetts Turnpike Authority, the Massachusetts Bay Transportation Authority, the Massachusetts Housing Finance Agency, the Massachusetts Port Authority, the Blue Hills Regional Vocational school system, the Greater Lawrence Sanitary District or the Minuteman Regional Vocational Technical School District as the case may be. (d) The public employee retirement administration commission may review all accidental and ordinary disability pensions, and termination retirement allowances under section 10, granted by the retirement boards. The commission may remand the matter with written instructions to the retirement board for further proceedings if he finds that the decision of the board is (1) made upon unlawful procedure, (2) unsupported by substantial evidence, (3) arbitrary and capricious, or (4) a result of fraud or misrepresentation. The commission shall take such action within thirty days of the date when he is notified by a retirement board of the granting of such pension. If within such time period, the commission takes no action, the determination of the retirement board shall be considered to have been approved by the commission. The commission shall make a written decision, include a statement of the reasons therefor, and send copies thereof to the board and to the applicant. (2) Assessment of Expenses of Supervision. — Any expenses incurred under the provisions of this section in connection with the supervision of any system shall be paid primarily by the commonwealth except for any expenses incurred in connection with a certified public accountant or a public accountant selected by the board of any system pursuant to the provisions of paragraph (a) of subdivision (1), which expenses shall be paid primarily by the applicable system. Each county which maintains a system shall reimburse the commonwealth for such proportion of such expenses attributable to such counties as shall be determined just and proper by the commission and assessed thereon by the state treasurer. The state treasurer shall issue his warrant requiring the assessors of the cities and towns concerned to assess a tax to the amount of such expenses attributable to such cities and towns as determined by the public employee retirement administration commission, and such amount shall be collected and paid to the state treasurer as provided by section twenty of chapter fifty-nine. The Massachusetts Turnpike Authority shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Massachusetts Bay Transportation Authority shall reimburse the commonwealth for such proportion of such expenses attributable to its police retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the public employee retirement administration commission. The Massachusetts Housing Finance Agency shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Massachusetts Port Authority shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Blue Hills Regional Vocational School system shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Greater Lawrence Sanitary District employees' retirement system shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Minuteman Regional Vocational Technical School District shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. (3) Duties of the Actuary. — The commission or his actuary or other agent with his approval shall be the technical advisor of the board of each such system in matters relating to the applicable provisions of this chapter, and in matters relating to the operation of the system, and shall perform such actuarial duties as are required in connection therewith, including, but not limited to:— (a) the approval of the amount of allowances under the provisions of said chapters, provided, however, that in the case of any system which calculates allowances with an automated system, the actuary shall instead review and approve said automated system, and any allowances calculated by an approved automated system shall be deemed to have been approved by the actuary; provided, further, that for any such system which calculates such allowances with an automated system, the commission may require from time to time and the system shall provide any additional information relative to the use of such automated system that the commission may deem appropriate; and provided, further, that any system failing to submit any such allowances for review shall be subject to such intervention and supervision as the commission deems necessary pursuant to the provisions of subdivision (1); (b) the review of all actuarial valuation reports prepared pursuant to the provision of paragraph (k) of subdivision (5) of section twenty or the provisions of section twenty A of chapter ten; (c) the preparation of an actuarial valuation report for each system; (d) the periodic review of the mortality and experience of each system; and (e) such other investigations as the commission shall deem necessary. (f) the preparation and filing with the general court, of a report, annually, in the month of January, on the computation of any increase in the United States Consumer Price Index and the percentage thereof in the previous year by the Commissioner of Social Security, including a statement that such increase in said Consumer Price Index during the last previous year requires a cost of living increase in the retirement allowances, pensions or annuities of eligible members, as defined in sections 102 and 103, equal to the percentage increase in the Consumer Price Index or 3 per cent, whichever is less. An actuarial valuation of each system shall be conducted biennially and experience investigations shall be conducted every 6 years. Actuarial valuation reports and experience studies shall be conducted in such manner as the commissioner of administration, upon advice of the actuary, shall consider appropriate. (i) The periodic experience investigation required shall accompany every other actuarial valuation report and shall cover the six-year period ending as of the end of the year preceding the date for which the actuarial valuation report is filed. For the initial filing pursuant to this chapter, the experience investigation shall be made for the six-year period ending as of the end of the plan year occurring on or after December thirty-first, nineteen hundred and eighty-seven and before December thirty-first, nineteen hundred and eighty-eight. The experience investigation shall be filed with the commissioner of administration, the public employee retirement administration commission, and the clerks of the house and senate. (ii) The actuarial valuation report and experience investigation required shall be prepared under the supervision and at the direction of the commissioner of administration, and said commissioner shall also be responsible for the filing of the documents. The actuarial valuation report and experience investigation shall be signed by said commissioner indicating that to the extent of his understanding and knowledge, the report or investigation represents a true and accurate portrayal of the actuarial, financial and demographic condition of the retirement systems. (iii) Each actuarial valuation report and experience investigation is a public record. The commissioner of administration shall take whatever steps are deemed necessary to insure that the information contained in the actuarial valuation report or experience investigation is made available to active members or benefit recipients of the retirement systems. (iv) The actuarial valuation report shall contain actuarial exhibits, financial exhibits and demographic exhibits. The actuarial exhibits shall be prepared and certified by an enrolled actuary. The remaining exhibits may be prepared by a qualified person other than an enrolled actuary. The financial and demographic exhibits shall be prepared as of the year ending immediately prior to the valuation date. (v) For each retirement system, all applicable actuarial exhibits shall be prepared in accordance with the entry age normal actuarial cost method with entry age established as the actual entry age for all plan members unless there are compelling reasons of an actuarial nature for the use of an alternative actuarial cost method. (vi) The actuarial cost method shall be used to value all aspects of each retirement system, unless there are compelling reasons of an actuarial nature for the use of approximation techniques other than the actuarial cost method for aspects of the retirement system other than the retirement benefit. (vii) The actuarial exhibits shall use actuarial assumptions which are, in the judgment of the actuary and the commissioner of administration, the best available estimate of future occurrences in the case of each assumption in the aggregate. With respect to economic actuarial assumptions, which shall include estimates of rates of future occurrences concerning, but not necessarily limited to, increases in salary, growth in state revenues, post retirement adjustments, investment earnings, asset appreciation or depreciation and procedures to determine the actuarial value of assets used in the preparation of actuarial valuations of the retirement system and other actuarial calculations, documentation explaining and justifying the choice of assumptions shall accompany the report. The actuarial exhibits shall measure all aspects of the retirement system in accordance with modifications in the statutory benefits, if any, and salaries which as of the valuation date are known or can reasonably be expected to be in force during the ensuing calendar year. (g) In consultation with the teachers' retirement board, review and analysis of information required under subdivision (4) of section 5 and the valuation of the annual costs and actuarial liabilities attributable to the additional benefits payable under said subdivision (4). The analysis shall focus on the contributions made by members and the normal cost of benefits, plus any other liabilities determined by the actuary to be a result of such benefit changes under said subdivision (4). The analysis shall also compare the total costs and actuarial liabilities attributable to those members who retire under the provisions of said subdivision (4) with the members classified in Group 1 of paragraph (g) of subdivision (2) of section 3 who do not retire under the provisions of said subdivision (4). Beginning January 1, 2002, and every year thereafter, the actuary shall forward such analysis to the teachers' retirement board, the clerks of the house of representatives and the senate, the house and senate committees on ways and means and the joint committee on public service. (4) Promulgation and Approval of Rules and Regulations. — The public employee retirement administration commission shall promulgate such rules and regulations as he may deem necessary from time to time to effectuate the purposes of this chapter, and he or his agent shall approve any by-laws, rules, regulations, prescribed forms or determinations of any board in order to effectuate such purposes. (5) Rehabilitation Programs for Disabled Employees. — (a) The public employee retirement administration commission shall develop in cooperation with the personnel administrator and the industrial accident rehabilitation board a program for the rehabilitation of persons who have been disabled and shall make available technical advice to other governmental units concerning such programs. He shall make said program available to any disabled employee seeking rehabilitation. (b) The commission shall in conjunction with the industrial accident department establish a list of medical and vocational rehabilitation facilities, both public and private, and physicians as are available to render competent medical rehabilitation services for disabled persons. Medical rehabilitation services shall include medical, surgical, hospital, prosthesis, and physical restoration services. No medical rehabilitation facility shall be considered as qualified unless it is established to provide rehabilitation services for persons suffering from some specialized or general type of disability within the field of employment injury, and unless such facility is operated under the supervision of a licensed physician or licensed physical therapist qualified to render rehabilitation services and is staffed with trained and qualified technicians. No physician or physical therapist shall be considered as qualified unless he has had experience for a reasonable term of years in a qualified rehabilitation facility. (c) The commission shall make available to every board the list of qualified physicians and medical and vocational rehabilitation facilities. The commission shall also review proposed rehabilitation programs not contained in such lists which may be submitted to the commission by boards from time to time for approval. If the commission finds that such proposed rehabilitation programs meet equivalent standards as those qualified facilities on the list, the commission shall approve such programs. The commission shall monitor the quality of rehabilitation programs and facilities and the utilization of rehabilitation programs by each board, including the successful completion of such programs and the effect of such programs on the finances of the public employee retirement system. (d) As soon as practicable following notice of the retirement of a member for disability under section six, seven, or twenty-six, the commission shall conduct an evaluation to determine whether such member might benefit from a medical or vocational rehabilitation program listed in paragraph (b) or otherwise approved by the commission. To assist in this determination the commission may require any such member to be examined by a physician qualified to render rehabilitation services or by a vocational counselor selected by the commission, or both, for a recommendation as to the need and nature of any such rehabilitation program. If the commission determines that such member might benefit from any such program, he shall so notify such member and the retirement board which shall select a public or private rehabilitation agency having a rehabilitation program suitable for such member. Such member shall meet with the agency selected and shall cooperate with the agency in the design of a suitable rehabilitation program. If the board determines that such retired member may benefit from such rehabilitation program, and that the program is reasonable in its terms and cost, the board shall approve and offer to provide and pay for such program as provided in section eight. If the commission approves the rehabilitation program offered by the board, said commission shall reimburse the board for the costs of such program. No member shall be required to participate in any such rehabilitation program. Notwithstanding the provisions of sections eight and ninety-one A there shall be no reduction in the retirement allowance of any member participating in a rehabilitation program approved by the commission on account of actual or potential earnings arising out of such rehabilitation program. Any such member who, in the determination of the commission, might benefit from any such program may, if denied access to such a program by the board, appeal such denial to the commission. If, upon such appeal, the commission determines that such member might benefit from such rehabilitation program, he shall approve and offer to provide and pay for such program. (e) The commission shall keep a record of all disabled members subject to or receiving rehabilitation and shall provide that record to the retirement boards. (6) Public Employee Retirement and Disability Data System. — The public employee retirement administration commission shall establish and maintain a comprehensive system of data relative to the contributory retirement and disability systems. The data system shall include sufficient information:— (a) to produce accurate and up-to-date actuarial valuations, reports, and projections for each retirement system; (b) in each of the areas of (1) disability retirement pursuant to sections six and seven, (2) disability after retirement pursuant to section five, (3) compensation pursuant to chapter one hundred and fifty-two, and (4) leave without loss of pay pursuant to section one hundred and eleven F of chapter forty-one, to review the status of each disabled individual as well as to review and report disability rates, types of disability, types of occupational injuries, effects of particular risk factors, effects of wellness and rehabilitation programs, and costs of disability programs, and to compare employment statistics by occupation with disability statistics; (c) to produce an annual report of the investment portfolio, return on investment, and management performance of each retirement system; (d) to index the decisions of the contributory retirement appeal board and other interpretations of retirement and disability law; and (e) to calculate and record assessments on each retirement system by the division of public employee retirement administration. Each board shall provide the commission with such information as the commission deems necessary to establish and maintain the data system. The executive head of each governmental unit of the head of each department shall provide the commission each year with such employment and occupational information as he deems necessary to establish and maintain the data system, in such form as he requires. The commission shall make any information or data collected pursuant to this section available to the retirement law commission upon request of said commission.

Section 21. (1) Duties of public employee retirement administration commission. — (a) The public employee retirement administration commission shall prescribe and supervise methods of accounting and recordkeeping for each system maintained under the provisions of this chapter. To ensure the maintenance of accurate and current membership records and payment information, the commission, for any board which fails to submit the requested information upon notice as prescribed in subdivision (5) of section twenty, may send his agents to examine the records and accounts of the board and to direct such action by the board or its employees as may be required to comply with acceptable recordkeeping and accounting standards. The commission shall require each board to keep in convenient form such data as is required for the purpose of valuing the assets, determining the liabilities of the system, making actuarial investigation of the experience of the system, and for promulgating rules and regulations governing the administrative procedures and for maximizing the assets of such system. Such data shall be submitted to the office of the public employee retirement administration commission within such time as he may specify. Each board shall maintain a copy of all collective bargaining agreements which cover the system's members and shall make the agreements available to the commission for review at such time as the commission shall specify. The commission or his agent shall conduct an in-depth field examination of each board at intervals not exceeding three years to ascertain its financial condition, its ability to fulfill its obligations, whether all parties in interest have complied with the laws applicable thereto, and whether the transactions of the board have been in accordance with the rights and equities of those in interest. Whenever the board of any system causes an examination of its financial condition to be made by a certified public accountant or a public accountant selected by said board, the board shall immediately, upon the employment of such person, file his name and address with the commission, and such person shall, within ten days after making the report of such examination to the board of such system, file a certified copy thereof with the commission. Any certified public accountant selected by said board shall conduct such examination in accordance with such procedures as the commission shall establish. The commission may, in his discretion, accept the examination so made, or cause an examination to be made pursuant to this paragraph. An examination conducted by a certified public accountant or a public accountant selected by said board, which is accepted by the commission, shall be deemed to be the examination required by this paragraph.

(b) Each such system, except any system appropriating funds pursuant to a funding schedule adopted in accordance with the provisions of section twenty-two C or twenty-two D as the case may be, shall be credited in its financial accounts with its investments having a fixed term and rate, if amply secured in the judgment of the public employee retirement administration commission and not in default as to principal or interest, as follows: if purchased at par, with the par value; if purchased above or below par, with an amortized value so determined as to yield approximately the effective rate of interest at which the purchase was made and to bring the value to par at the date of maturity or at the date the security is first callable at par if prior thereto; provided, however, that the purchase price of any such security shall not be taken at a higher value than its actual market value when purchased; and provided, further, that the value of any security on the date of any valuation thereof shall not be taken at a higher value than its callable value, if any, on such date. The public employee retirement administration commission shall have full power and discretion in determining the methods of calculating values according to the foregoing rules, and the values found by him in accordance with such methods shall be final and binding; provided, however, that any investments in United States savings bonds purchased on a discount basis may be credited at their redemption value or at their amortized value, as the board shall determine. The public employee retirement administration commission shall also have full power and discretion in determining the method of calculating the values of any other investments of any system; provided, however, that the calculation of such values shall be consistent with methods prescribed by the Government Accounting Standards Board or methods allowed by the Employee Retirement Income Security Act, so-called.

(c) The public employee retirement administration commission or his agent shall, for the purpose of carrying out the provisions of this section, have access to all the securities, books and papers of any such system and may summon and administer oath to and examine any person relative to the financial affairs, transactions and condition of the system. The commission shall preserve in a permanent form a full record of the proceedings of each examination of a system and the results thereof. Upon the completion of such examination, verification and valuation, the commission shall make a report in writing of his findings to the board, and shall send a copy thereof to the governor and state treasurer, the county commissioners, the mayor, the board of selectmen, the Massachusetts Turnpike Authority, the Massachusetts Bay Transportation Authority, the Massachusetts Housing Finance Agency, the Massachusetts Port Authority, the Blue Hills Regional Vocational school system, the Greater Lawrence Sanitary District or the Minuteman Regional Vocational Technical School District as the case may be.

(d) The public employee retirement administration commission may review all accidental and ordinary disability pensions, and termination retirement allowances under section 10, granted by the retirement boards. The commission may remand the matter with written instructions to the retirement board for further proceedings if he finds that the decision of the board is (1) made upon unlawful procedure, (2) unsupported by substantial evidence, (3) arbitrary and capricious, or (4) a result of fraud or misrepresentation. The commission shall take such action within thirty days of the date when he is notified by a retirement board of the granting of such pension. If within such time period, the commission takes no action, the determination of the retirement board shall be considered to have been approved by the commission. The commission shall make a written decision, include a statement of the reasons therefor, and send copies thereof to the board and to the applicant.

(2) Assessment of Expenses of Supervision. — Any expenses incurred under the provisions of this section in connection with the supervision of any system shall be paid primarily by the commonwealth except for any expenses incurred in connection with a certified public accountant or a public accountant selected by the board of any system pursuant to the provisions of paragraph (a) of subdivision (1), which expenses shall be paid primarily by the applicable system. Each county which maintains a system shall reimburse the commonwealth for such proportion of such expenses attributable to such counties as shall be determined just and proper by the commission and assessed thereon by the state treasurer. The state treasurer shall issue his warrant requiring the assessors of the cities and towns concerned to assess a tax to the amount of such expenses attributable to such cities and towns as determined by the public employee retirement administration commission, and such amount shall be collected and paid to the state treasurer as provided by section twenty of chapter fifty-nine. The Massachusetts Turnpike Authority shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Massachusetts Bay Transportation Authority shall reimburse the commonwealth for such proportion of such expenses attributable to its police retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the public employee retirement administration commission. The Massachusetts Housing Finance Agency shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Massachusetts Port Authority shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Blue Hills Regional Vocational School system shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Greater Lawrence Sanitary District employees' retirement system shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission. The Minuteman Regional Vocational Technical School District shall reimburse the commonwealth for such proportion of such expenses attributable to its retirement system as shall be determined just and proper by the commission, which sum shall be paid to the state treasurer upon notice from the commission.

(3) Duties of the Actuary. — The commission or his actuary or other agent with his approval shall be the technical advisor of the board of each such system in matters relating to the applicable provisions of this chapter, and in matters relating to the operation of the system, and shall perform such actuarial duties as are required in connection therewith, including, but not limited to:—

(a) the approval of the amount of allowances under the provisions of said chapters, provided, however, that in the case of any system which calculates allowances with an automated system, the actuary shall instead review and approve said automated system, and any allowances calculated by an approved automated system shall be deemed to have been approved by the actuary; provided, further, that for any such system which calculates such allowances with an automated system, the commission may require from time to time and the system shall provide any additional information relative to the use of such automated system that the commission may deem appropriate; and provided, further, that any system failing to submit any such allowances for review shall be subject to such intervention and supervision as the commission deems necessary pursuant to the provisions of subdivision (1);

(b) the review of all actuarial valuation reports prepared pursuant to the provision of paragraph (k) of subdivision (5) of section twenty or the provisions of section twenty A of chapter ten;

(c) the preparation of an actuarial valuation report for each system;

(d) the periodic review of the mortality and experience of each system; and

(e) such other investigations as the commission shall deem necessary.

(f) the preparation and filing with the general court, of a report, annually, in the month of January, on the computation of any increase in the United States Consumer Price Index and the percentage thereof in the previous year by the Commissioner of Social Security, including a statement that such increase in said Consumer Price Index during the last previous year requires a cost of living increase in the retirement allowances, pensions or annuities of eligible members, as defined in sections 102 and 103, equal to the percentage increase in the Consumer Price Index or 3 per cent, whichever is less.

An actuarial valuation of each system shall be conducted biennially and experience investigations shall be conducted every 6 years. Actuarial valuation reports and experience studies shall be conducted in such manner as the commissioner of administration, upon advice of the actuary, shall consider appropriate.

(i) The periodic experience investigation required shall accompany every other actuarial valuation report and shall cover the six-year period ending as of the end of the year preceding the date for which the actuarial valuation report is filed. For the initial filing pursuant to this chapter, the experience investigation shall be made for the six-year period ending as of the end of the plan year occurring on or after December thirty-first, nineteen hundred and eighty-seven and before December thirty-first, nineteen hundred and eighty-eight. The experience investigation shall be filed with the commissioner of administration, the public employee retirement administration commission, and the clerks of the house and senate.

(ii) The actuarial valuation report and experience investigation required shall be prepared under the supervision and at the direction of the commissioner of administration, and said commissioner shall also be responsible for the filing of the documents. The actuarial valuation report and experience investigation shall be signed by said commissioner indicating that to the extent of his understanding and knowledge, the report or investigation represents a true and accurate portrayal of the actuarial, financial and demographic condition of the retirement systems.

(iii) Each actuarial valuation report and experience investigation is a public record. The commissioner of administration shall take whatever steps are deemed necessary to insure that the information contained in the actuarial valuation report or experience investigation is made available to active members or benefit recipients of the retirement systems.

(iv) The actuarial valuation report shall contain actuarial exhibits, financial exhibits and demographic exhibits. The actuarial exhibits shall be prepared and certified by an enrolled actuary. The remaining exhibits may be prepared by a qualified person other than an enrolled actuary. The financial and demographic exhibits shall be prepared as of the year ending immediately prior to the valuation date.

(v) For each retirement system, all applicable actuarial exhibits shall be prepared in accordance with the entry age normal actuarial cost method with entry age established as the actual entry age for all plan members unless there are compelling reasons of an actuarial nature for the use of an alternative actuarial cost method.

(vi) The actuarial cost method shall be used to value all aspects of each retirement system, unless there are compelling reasons of an actuarial nature for the use of approximation techniques other than the actuarial cost method for aspects of the retirement system other than the retirement benefit.

(vii) The actuarial exhibits shall use actuarial assumptions which are, in the judgment of the actuary and the commissioner of administration, the best available estimate of future occurrences in the case of each assumption in the aggregate. With respect to economic actuarial assumptions, which shall include estimates of rates of future occurrences concerning, but not necessarily limited to, increases in salary, growth in state revenues, post retirement adjustments, investment earnings, asset appreciation or depreciation and procedures to determine the actuarial value of assets used in the preparation of actuarial valuations of the retirement system and other actuarial calculations, documentation explaining and justifying the choice of assumptions shall accompany the report. The actuarial exhibits shall measure all aspects of the retirement system in accordance with modifications in the statutory benefits, if any, and salaries which as of the valuation date are known or can reasonably be expected to be in force during the ensuing calendar year.

(g) In consultation with the teachers' retirement board, review and analysis of information required under subdivision (4) of section 5 and the valuation of the annual costs and actuarial liabilities attributable to the additional benefits payable under said subdivision (4). The analysis shall focus on the contributions made by members and the normal cost of benefits, plus any other liabilities determined by the actuary to be a result of such benefit changes under said subdivision (4). The analysis shall also compare the total costs and actuarial liabilities attributable to those members who retire under the provisions of said subdivision (4) with the members classified in Group 1 of paragraph (g) of subdivision (2) of section 3 who do not retire under the provisions of said subdivision (4). Beginning January 1, 2002, and every year thereafter, the actuary shall forward such analysis to the teachers' retirement board, the clerks of the house of representatives and the senate, the house and senate committees on ways and means and the joint committee on public service.

(4) Promulgation and Approval of Rules and Regulations. — The public employee retirement administration commission shall promulgate such rules and regulations as he may deem necessary from time to time to effectuate the purposes of this chapter, and he or his agent shall approve any by-laws, rules, regulations, prescribed forms or determinations of any board in order to effectuate such purposes.

(5) Rehabilitation Programs for Disabled Employees. — (a) The public employee retirement administration commission shall develop in cooperation with the personnel administrator and the industrial accident rehabilitation board a program for the rehabilitation of persons who have been disabled and shall make available technical advice to other governmental units concerning such programs. He shall make said program available to any disabled employee seeking rehabilitation.

(b) The commission shall in conjunction with the industrial accident department establish a list of medical and vocational rehabilitation facilities, both public and private, and physicians as are available to render competent medical rehabilitation services for disabled persons. Medical rehabilitation services shall include medical, surgical, hospital, prosthesis, and physical restoration services. No medical rehabilitation facility shall be considered as qualified unless it is established to provide rehabilitation services for persons suffering from some specialized or general type of disability within the field of employment injury, and unless such facility is operated under the supervision of a licensed physician or licensed physical therapist qualified to render rehabilitation services and is staffed with trained and qualified technicians. No physician or physical therapist shall be considered as qualified unless he has had experience for a reasonable term of years in a qualified rehabilitation facility.

(c) The commission shall make available to every board the list of qualified physicians and medical and vocational rehabilitation facilities. The commission shall also review proposed rehabilitation programs not contained in such lists which may be submitted to the commission by boards from time to time for approval. If the commission finds that such proposed rehabilitation programs meet equivalent standards as those qualified facilities on the list, the commission shall approve such programs. The commission shall monitor the quality of rehabilitation programs and facilities and the utilization of rehabilitation programs by each board, including the successful completion of such programs and the effect of such programs on the finances of the public employee retirement system.

(d) As soon as practicable following notice of the retirement of a member for disability under section six, seven, or twenty-six, the commission shall conduct an evaluation to determine whether such member might benefit from a medical or vocational rehabilitation program listed in paragraph (b) or otherwise approved by the commission. To assist in this determination the commission may require any such member to be examined by a physician qualified to render rehabilitation services or by a vocational counselor selected by the commission, or both, for a recommendation as to the need and nature of any such rehabilitation program. If the commission determines that such member might benefit from any such program, he shall so notify such member and the retirement board which shall select a public or private rehabilitation agency having a rehabilitation program suitable for such member. Such member shall meet with the agency selected and shall cooperate with the agency in the design of a suitable rehabilitation program. If the board determines that such retired member may benefit from such rehabilitation program, and that the program is reasonable in its terms and cost, the board shall approve and offer to provide and pay for such program as provided in section eight. If the commission approves the rehabilitation program offered by the board, said commission shall reimburse the board for the costs of such program. No member shall be required to participate in any such rehabilitation program. Notwithstanding the provisions of sections eight and ninety-one A there shall be no reduction in the retirement allowance of any member participating in a rehabilitation program approved by the commission on account of actual or potential earnings arising out of such rehabilitation program. Any such member who, in the determination of the commission, might benefit from any such program may, if denied access to such a program by the board, appeal such denial to the commission. If, upon such appeal, the commission determines that such member might benefit from such rehabilitation program, he shall approve and offer to provide and pay for such program.

(e) The commission shall keep a record of all disabled members subject to or receiving rehabilitation and shall provide that record to the retirement boards.

(6) Public Employee Retirement and Disability Data System. — The public employee retirement administration commission shall establish and maintain a comprehensive system of data relative to the contributory retirement and disability systems. The data system shall include sufficient information:—

(a) to produce accurate and up-to-date actuarial valuations, reports, and projections for each retirement system;

(b) in each of the areas of (1) disability retirement pursuant to sections six and seven, (2) disability after retirement pursuant to section five, (3) compensation pursuant to chapter one hundred and fifty-two, and (4) leave without loss of pay pursuant to section one hundred and eleven F of chapter forty-one, to review the status of each disabled individual as well as to review and report disability rates, types of disability, types of occupational injuries, effects of particular risk factors, effects of wellness and rehabilitation programs, and costs of disability programs, and to compare employment statistics by occupation with disability statistics;

(c) to produce an annual report of the investment portfolio, return on investment, and management performance of each retirement system;

(d) to index the decisions of the contributory retirement appeal board and other interpretations of retirement and disability law; and

(e) to calculate and record assessments on each retirement system by the division of public employee retirement administration.

Each board shall provide the commission with such information as the commission deems necessary to establish and maintain the data system. The executive head of each governmental unit of the head of each department shall provide the commission each year with such employment and occupational information as he deems necessary to establish and maintain the data system, in such form as he requires.

The commission shall make any information or data collected pursuant to this section available to the retirement law commission upon request of said commission.