New Jersey Administrative Code › Title 17 - TREASURY - GENERAL › Chapter 7 - ALTERNATE BENEFIT PROGRAM › Subchapter 2 - DEFINITIONS › Section 17:7-2.1 - Definitions

Current through Register Vol. 56, No. 14, July 15, 2024
Whenever used in the Program or with respect to an applicable
				  Plan, each of the following terms has the meaning stated below. To the extent
				  that any term is not defined in this subchapter or otherwise by this chapter,
				  such term has the meaning given by
				  N.J.S.A. 18A:66-169
				  or
				  52:18A-113.2
				  or by the Internal Revenue Code.
"Account" means the total of the individual account(s)
				  maintained on behalf of each participant, beneficiary, or alternate payee under
				  the investment option(s) held pursuant to the ABP Retirement Plan or the ACTS,
				  taking into account all contributions made to the investment option and all
				  earnings or losses (including expenses) that are allocable to the participant's
				  account, any rollover contributions or transfers held under the participant's
				  account, and any distribution made to the participant, the participant's
				  beneficiary, or any alternate payee. The account balance includes any part of
				  the participant's account that is treated under the ACTS as a separate contract
				  to which IRC § 403(c) (or another applicable provision of the Code)
				  applies.
"Accumulated deductions" means those contributions as defined
				  in
				  18A:66-2 or in
				  section 6 of P.L. 1954, c. 84 (43:15A-6 ).
"Adjunct faculty members" or "part-time instructors" mean
				  those faculty appointed as adjunct professors or part-time instructors by the
				  respective school, whose employment agreement begins on or after November 1,
				  2008.
"Administrative staff" means any employee whose minimum
				  qualifications for hiring include a baccalaureate degree or its equivalent, but
				  shall not include career service employees as defined by the Civil Service
				  Commission pursuant to the provisions of Title 11A of the New Jersey Revised
				  Statutes.
"Alternate payee" means a person who is an alternate payee
				  (within the meaning of IRC § 414(p)(8)) under an order directed to the ABP
				  Retirement Plan or the ACTS that the Plan Administrator has determined to be a
				  Qualified Domestic Relations Order.
"Annuity contract" means a nontransferable contract as
				  defined in IRC §§ 403(b)(1) and 401(g), established for each
				  participant by the employer, or by each participant individually, that is
				  issued by an insurance company qualified to issue annuities in New Jersey and
				  that includes payment in the form of an annuity, to hold assets of the
				  ACTS.
"Annuity payment option" means a payment option under the ABP
				  Retirement Plan, if permitted by the plan administrator, which includes a
				  provision for payments based, in whole or in part, upon the life of a natural
				  person.
"Applicable form" means the appropriate form as designated
				  and furnished by the plan administrator or DSP to make an election or provide a
				  notice as required by the Program, including a form in electronic medium with
				  an electronic signature in compliance with E-SIGN and applicable law. As used
				  in this definition, the following terms have the following meanings:
1. "E-SIGN" means
				  15 U.S.C. §§
										7001 to
				  7006,
				  7021,
				  7031;
				  and
				  47
				  U.S.C. § 231 note - the Federal Electronic Signatures in Global and
				  National Commerce Act.
2. "Electronic" means, consistent with E-SIGN
				  15
				  U.S.C. §
										7006(2), of or
				  relating to technology having electrical, digital, magnetic, optical,
				  electromagnetic, or similar capabilities regardless of medium.
3. "Electronic signature" means, consistent with E-SIGN
				  15
				  U.S.C. §
										7006(5),
				  information or data in electronic form, attached to or logically associated
				  with an electronic record, and executed or adopted by a person or an electronic
				  agent of a person, with the intent to sign a contract, agreement, or record.
"Applicable law" means the law of the United States of
				  America or the law of the State of New Jersey that is applicable to the
				  governance or administration of the Program or an applicable Plan under the
				  Program.
"Base annual salary" means the base salary upon which
				  contributions by the participant and his or her employer to the ABP Retirement
				  Plan were based during the year of creditable service last credited to the
				  participant.
"Base salary" means a participant's regular base or
				  contractual salary. Base salary includes employee contributions as well as
				  salary reduction contributions and other amounts excluded from gross income
				  with respect to such base salary under, without limitation,
IRC
				  §§ 125
,
132(f)(4)
,
402(e)(3)
,
402(h)(1)(b)
,
403(b)
,
414(h)(2)
, or
457(b)
. Payments related to guaranteed faculty practice moneys
				  shall be included in such base salary up to the extent provided by
43:3C-9.1
et seq. The employee's and employer's contributions shall be computed
				  on earned and paid base salary. Base salary excludes bonus, overtime, or other
				  forms of extra compensation, such as:
1. Longevity lump sum payments;
2. Lump sum terminal sick leave or vacation pay;
3. The value of maintenance;
4. Individual pay adjustments made within or at the
				  conclusion of the participant's final year of service;
5. Retroactive salary adjustments or other pay adjustments
				  made in the participant's final year of service unless such adjustment was made
				  as a result of a general pay adjustment for all personnel of the department or
				  institution;
6. Any unscheduled individual adjustment made in the final
				  year to place the member at the maximum salary level within his or her salary
				  range;
7. Any pay for services rendered during the summer vacation
				  period by a participant who is required to work only 10 months of the
				  year;
8. Vehicle allowance or reimbursement;
9. Housing allowance or reimbursement; and
10. Relocation allowance or reimbursement.
"Beneficiary" means each person a participant designates by a
				  valid beneficiary designation to receive any undistributed benefit payable on
				  or after the participant's death. A named beneficiary who feloniously and
				  intentionally kills the participant or another beneficiary is not a beneficiary
				  and is not entitled to any distribution or any other right under the Program or
				  any Plan under the ABP Program; and any benefit is paid as though the killer
				  had predeceased the participant or beneficiary. This definition shall not apply
				  to the Group Life Insurance Plan.
"Beneficiary designation" means a valid and effective
				  beneficiary designation made according to
				  N.J.A.C.
				  17:7-22.1.
"Benefit" means the right under the ABP Retirement Plan of
				  the participant (or beneficiary or other payee) to receive a distribution of
				  all or any portion of the participant's account.
"Board" means the Pension Provider Selection Board
				  established under N.J.A.C. 17:7-3.
"Civil union partner" means the individual that is the
				  participant's civil union partner under the laws of the State of New
				  Jersey.
"Contributions" means contributions under the provisions of
				  the ABP Retirement Plan or the ACTS, including employee contributions and
				  employer contributions.
"County colleges" means the colleges so defined in
				  18A:64A-1.
"Custodial account" means the group or individual custodial
				  account or accounts, as defined in IRC § 403(b)(7), established for each
				  participant by the employer or by each participant individually to hold assets
				  of the ACTS.
"Designated service provider" or "DSP" means a company
				  designated as a provider by the Board under
				  18A:66-172.1,
				  or an insurance company selected by the State Treasurer to provide group life
				  insurance or group long-term disability insurance coverage to participants
				  under
				  18A:66-177.
				  The term designated service provider also includes the pension providers
				  approved to offer investment alternatives to participants of the ABP, the ABP
				  Retirement Plan, and the ACTS. A DSP shall provide group life coverage to
				  participants of the ABP. A DSP shall provide group long-term disability
				  insurance coverage to participants of the ABP.
"Direct rollover" means a payment under the ABP Retirement
				  Plan or the ACTS to an eligible ABP Retirement Plan specified by the
				  distributee.
"Distributee" means any person who receives, or but for his
				  or her instruction to the plan administrator is entitled to receive, a
				  distribution. A distributee includes an alternate payee to whom the plan
				  administrator is directed to make a payment under a Qualified Domestic
				  Relations Order.
"Distribution" means, as appropriate in the context, any
				  kind of distribution or the particular kind of distribution provided by the ABP
				  Retirement Plan, Group Life Insurance Plan, or ACTS.
"Distribution commencement date" means the first date on
				  which a distribution (or any payment under a distribution) is paid or becomes
				  payable.
"Division of Pensions and Benefits" means the Division of
				  Pensions and Benefits established in the Department of the Treasury pursuant to
				  section 1 of P.L. 1955, c. 70 (52:18A-95
				  ) and is the agency responsible for the administration of the Alternate Benefit
				  Program of the State and county colleges and for the administration of the
				  group life and disability insurances of all Alternate Benefit Programs
				  established in the State for public employees.
"Elective deferral" means the employer contributions made to
				  the ACTS at the election of the participant in lieu of receiving cash
				  compensation. Elective deferrals may be pre-tax salary reduction contributions
				  or Roth elective deferrals as designated by the participant.
"Eligible employee" means, with respect to each plan, an
				  employee of an employer who is classified as eligible for participation in the
				  Plan pursuant to N.J.A.C. 17:7-4. Subject to the approval of the Plan
				  Administrator, the employer's classification of a person as an employee or
				  other individual with the status of an eligible employee for purposes of this
				  chapter shall be final and conclusive.
"Employee" with respect to the ACTS means each individual,
				  whether appointed or elected, who is a common law employee of the employer. If
				  the employer is a public school, the individual must perform services for a
				  public school as an employee of the employer, including an individual who is
				  appointed or elected. This definition is not applicable unless the employee's
				  compensation for performing services for a public school is paid by the
				  employer. Further, a person occupying an elective or appointive public office
				  is not an employee performing services for a public school unless such office
				  is one to which an individual is elected or appointed only if the individual
				  has received training, or is experienced, in the field of education. A public
				  office includes any elective or appointive office of a State or local
				  government. For ACTS purposes, the Plan Administrator may rely upon the
				  certification of the employer that a person is an employee.
"Employee account" means the account maintained to account
				  for employee contributions and earnings, losses, and administrative expenses
				  charged to the account in the ABP Retirement Plan, the ACTS, or the Closed
				  Plan, as applicable.
"Employee contributions" means those contributions made by
				  the participant to the ABP Retirement Plan pursuant to
				  17:7-5.2.
"Employee voluntary contributions" means those contributions
				  in addition to the employee contribution that the Plan Administrator may permit
				  the participant to make to the ACTS.
"Employer" means county colleges; Rutgers, the State
				  University; Rowan University; University Hospital; and the State colleges, that
				  pays the base salary of a participant for services rendered by the participant.
				  Except as described in this definition, each employer with eligible employees
				  shall be a participating employer with respect to the ABP for the benefit of
				  its eligible employees as described in N.J.A.C. 17:7-4 and not excluded
				  thereunder, and shall not be required to take affirmative action to adopt the
				  ABP for its eligible employees or to enter into any contractual arrangement
				  regarding its obligations to contribute to the plan, except as may be required
				  by the Plan Administrator. Notwithstanding the foregoing, the Plan
				  Administrator may determine that an employer is not eligible to maintain the
				  ABP for its employees if the Plan Administrator reasonably concludes that the
				  employer is not an employer that can maintain a "governmental plan" within the
				  meaning of § 414(d) of the Federal Internal Revenue Code or Section 3(32)
				  of the Employees Retirement Income Security Act, as amended. The Plan
				  Administrator's determination in this regard shall be final and
				  conclusive.
"Employer" with respect to the ACTS must be either: a
				  governmental instrumentality that is a tax-exempt organization under IRC §
				  501(c)(3); or a public school that is a State-sponsored educational
				  organization described in IRC § 170(b)(1)(A)(ii) (relating to educational
				  organizations that normally maintain a regular faculty and curriculum and
				  normally has a regularly enrolled body of pupils or students in attendance at
				  the place where educational activities are regularly carried out). Any State
				  entity must meet the definition of Treasury Reg. § 1.403(b)-2(b)(8), which
				  requires that, for public schools, the State is the employer, but only with
				  respect to an employee of the State performing services for a public school.
				  Furthermore, the Plan Administrator may determine that an employer is not
				  eligible to maintain the ACTS Program for its employees if the Plan
				  Administrator reasonably concludes that the employer is not a governmental
				  instrumentality that is a tax-exempt organization under IRC § 501(c)(3) or
				  a public school that is a State-sponsored educational organization described in
				  IRC § 170(b)(1)(A)(ii). The Plan Administrator's determination in this
				  regard shall be final and conclusive.
"Employer account" means the account maintained to account
				  for employer contributions and earnings, losses, and administrative expenses
				  charged to that account in the ABP Retirement Plan.
"Employer contributions" means contributions that are made by
				  an employer that are not elective deferrals.
"Enabling statute" means
				  18A:64A-72.
"Fees" means any fees required or permitted to be charged
				  against the participant's (or beneficiary's or alternate payee's) ABP
				  Retirement Plan account or ACTS account according to any one or more of the
				  following, as applicable: the ABP Retirement Plan, the Participation Agreement,
				  an investment option, including surrender and/or redemption fees, an investment
				  advisory agreement, any other writing signed by the participant (or, after the
				  participant's death, the beneficiary), any written notice given by or on behalf
				  of the Plan Administrator that is accepted or deemed accepted by the
				  participant (or beneficiary), or any court order. Additionally, the ABP Plan
				  Administrator may impose fees to pay for expenses it deems proper to administer
				  the Retirement Plan or the ACTS. The fees may be charged to the participants'
				  accounts according to an equitable method determined by the plan
				  administrator.
"Fiduciary" means a person that is a fiduciary within the
				  meaning of applicable law regarding the program or an applicable plan under the
				  program.
"Full-time officers" and "Full-time members of the faculty"
				  means all full-time officers and full-time members of the faculty, including,
				  but not be limited to, the president, vice president, secretary, and treasurer
				  of the respective school. "Full-time" shall also include eligible full-time
				  officers and full-time members of the faculty who are granted sabbaticals or
				  leaves of absence with pay where the compensation paid is 50 percent or more of
				  the base salary at the time the leave commences and the period of eligibility
				  terminates with the end of the school year following the year in which the
				  sabbatical began.
"Group Annuity Plan" means the Group Annuity Contract R-134
				  between the Board of Trustees of the New Jersey Institute of Technology and the
				  Prudential Insurance Company of America.
"Group Life Insurance Plan" means the Alternate Benefit
				  Program Group Life Insurance Plan as described in this chapter.
"Group Long-Term Disability Plan" means the Alternate Benefit
				  Program Group Long-Term Disability Benefit Plan as described in this
				  chapter.
"Investment option" means any investment option offered by
				  the Board in accordance with the ABP Retirement Plan's or ACTS's investment
				  policy and approved by the Plan Administrator, for investment by participants
				  (or beneficiaries) of their ABP Retirement Plan accounts or their ACTS
				  accounts. With respect to ACTS, an "investment option" must be an annuity
				  contract or custodial account in the ACTS that satisfies the requirements of
				  Treasury Reg. § 1.403(b)-3 and that is issued or established for funding
				  amounts held under the ACTS. A list of pension providers and investment options
				  approved for use under the ABP Retirement Plan and ACTS, including sufficient
				  information to identify the approved investment options, shall be maintained by
				  the Plan Administrator. The terms governing each investment option under the
				  ABP Retirement Plan and ACTS, excluding those terms that are inconsistent with
				  State law, IRC § 401(a), or IRC § 403(b), are hereby incorporated by
				  reference in this chapter.
"Investment law" means, as applicable or relevant in the
				  context, any Federal or State banking law, insurance law, securities law, and
				  other rules of the National Association of Securities Dealers, Inc. (NASD),
				  NYSE, and any stock exchange or commodities exchange, to the extent approved or
				  not disapproved by the Securities and Exchange Commission.
"Limitation year" means each 12-month period ending December
				  31.
"Loan coordinator" means the person selected to oversee all
				  aspects of the ABP Retirement Plan's, ACT's, or Closed Plan's loan
				  program.
"Mutual fund company" means an investment company or trust
				  regulated by the Federal Investment Company Act of 1940,
				  15 U.S.C. §§
										80a-1 et seq.
"New Jersey Institute of Technology" means the public
				  research university comprised of all departments, colleges, schools, centers,
				  branches, educational, and other units and extensions of the Newark College of
				  Engineering, New Jersey School of Architecture, the College of Science and
				  Liberal Arts, the School of Industrial Management, centers, extension and
				  cooperative education programs, continuing education programs, and all other
				  departments of higher education maintained by the education entity of this
				  university.
"Non-academic employee" is one who does not occupy a faculty
				  or other teaching position with academic rank or other equivalent title whose
				  primary employment is not directly related to teaching, research, and/or other
				  aspects of the educational programs of the county college. Adjunct faculty
				  members and part-time instructors of the faculty of Rutgers, the State
				  University; the New Jersey Institute of Technology; Rowan University; the
				  State; and county colleges are excluded from this definition.
"NYSE" means the New York Stock Exchange.
"Part-time" means an appointment where the employee receives
				  a salary or wages for a period of less than 50 percent of the normal work week.
				  This definition shall apply to teaching and administrative staff members, and
				  to employees serving in a dual capacity where the appointment includes
				  teaching, as well as administrative duties. However, adjunct faculty members
				  and part-time instructors of the faculty of Rutgers, the State University; the
				  New Jersey Institute of Technology; Rowan University; the State; and county
				  colleges shall be excluded from this definition.
"Participant or member" means the eligible employee (or
				  former eligible employee) who is enrolled in an applicable Plan under the
				  Program; with respect to the ABP Retirement Plan, an individual for whom
				  contributions under the ABP Retirement Plan have been made or accrued and whose
				  account has not been fully distributed under the ABP Retirement Plan, and, with
				  respect to the ACTS, an individual for whom contributions under the ACTS have
				  been made or accrued and whose account has not been fully distributed under the
				  ACTS.
"Participation Agreement" means the applicable form that
				  designates the participant's investment options and such other information as
				  the Plan Administrator may prescribe for the efficient or convenient
				  administration of the Program or an applicable Plan under the Program.
"Payment option" means, with respect to the ABP Retirement
				  Plan and ACTS, any of the options for payment of a participant's ABP Retirement
				  Plan account or ACTS account that is permitted by the Plan Administrator and
				  consistent with the terms of the ABP Retirement Plan or ACTS, respectively, and
				  any applicable investment contract approved by the Board, except as limited in
				  this definition. A payment option shall not be based on gender-distinct
				  actuarial tables. A payment option must satisfy all applicable provisions of
				  the ABP Retirement Plan or the ACTS, respectively, as determined by the Plan
				  Administrator, including, but not limited to, the applicable investment
				  contract approved by the Bo ard. A payment option must also satisfy all
				  applicable provisions of applicable law.
"Pension provider" means an insurance or mutual fund company
				  selected by the Board under N.J.A.C. 17:7-3.
"Pension reserve" means those moneys as defined in
				  18A:66-2 or in
				  section 6 of P.L. 1954, c. 84 (43:15A-6 ).
"Person" means a natural person, a corporation, a limited
				  liability company, an unincorporated association, a partnership, a joint
				  venture, a business trust, or anything that is a person within the meaning of
				  applicable law.
"Personal representative" means the person duly appointed by
				  an order of the court (or of a registrar or administrator under the court's
				  supervision) having jurisdiction over the estate of the participant that grants
				  the person the authority to receive the property of the deceased participant
				  and to act as the personal representative of the participant's probate
				  estate.
"Plan" means the ABP Retirement Plan, the ACTS, the Group
				  Long-Term Disability Plan, the Group Life Insurance Plan, and/or the Closed
				  Plan, as the context requires.
"Plan Administrator" means the Director of the New Jersey
				  Division of Pensions and Benefits and includes any designated service provider
				  or pension provider to the extent that the Division of Pensions and Benefits
				  delegates duties to that DSP or pension provider.
"Plan sponsor" means the State of New Jersey and the State
				  and county colleges of New Jersey.
"Plan year" or "fiscal year" means each 12-month period
				  ending June 30.
"Professional administrative staff" means any employee whose
				  minimum qualifications for hiring include a baccalaureate degree or its
				  equivalent, but shall not include career service employees as defined by the
				  Civil Service Commission pursuant to the provisions of Title 11A of the New
				  Jersey Revised Statutes.
"Program" means the New Jersey Alternate Benefit Program
				  provided by the enabling statute, as described by this chapter. The Program
				  consists of the ABP Retirement Plan, the ACTS, the Group Life Insurance Plan,
				  the Group Long-Term Disability Plan, and the Closed Plan.
"Qualified Domestic Relations Order" or "QDRO" means a
				  domestic relations order directed to the Retirement Plan or the ACTS that
				  creates or recognizes the existence of the right of an alternate payee to
				  receive all or a portion of any benefit payable to a participant under the ABP
				  Retirement Plan and that further meets all requirements for a Qualified
				  Domestic Relations Order stated by IRC § 414(p) as applied to a
				  governmental plan and N.J.A.C. 17:7-7.
"Related employer" means the employer and any other entity
				  that is under common control with the employer under IRC § 414(b), (c),
				  (m), or (o). The employer shall determine which entities are related employers
				  based on a reasonable, good faith standard and taking into account the special
				  rules applicable under Internal Revenue Service Notice 89-23, 1989- 1 C.B.
				  654.
"Retirement Plan" or "ABP Retirement Plan" means that portion
				  of Alternate Benefit Program that is a qualified plan under IRC § 401(a)
				  and to which IRC § 414(h)(2) contributions are deposited, as described in
				  this chapter and as it may be amended.
"Rollover account" means the sub-account maintained to
				  account for rollover contributions pursuant to
				  17:7-13.3 and earnings, losses,
				  and administration expenses charged to that sub-account.
"Roth elective deferrals" means, for the ACTS, if permitted
				  under the terms of the applicable investment option, all or a portion of the
				  participant's elective deferrals designated as Roth elective deferrals. A Roth
				  elective deferral is an elective deferral that is designated irrevocably by the
				  participant at the time of the election as a Roth elective deferral that is
				  being made in lieu of all or a portion or the pre-tax elective deferrals the
				  participant is otherwise eligible to make under the ACTS and treated by the
				  employer as includible in the participant's income at the time the participant
				  would have received that amount in cash if the participant had not made a
				  salary reduction agreement.
"Rowan University" means the public research university
				  described in Chapter 64M of Title 18A of the New Jersey Statutes.
"Rutgers, the State University" means the institution of
				  higher education described in Chapter 65 of Title 18A of the New Jersey
				  Statutes.
"SEC" means and refers to the Securities and Exchange
				  Commission, an agency of the government of the United States of America,
				  established by § 4(a) of the Federal Securities Exchange Act of
				  1934.
"Severance from employment" means the date the participant
				  terminates employment with an employer with no obligation or expectation for
				  future services to be performed for an employer by the participant. The Plan
				  Administrator is entitled to rely upon the date of severance from employment
				  certified by the employer. "Severance from employment" also means, for purposes
				  of the ACTS, that an employee ceases to be employed by the employer maintaining
				  the ACTS or a related employer that is eligible to maintain a 403(b) plan or in
				  a capacity that is employment with an eligible employer. For example, if the
				  employer is a public school, "severance from employment" means that the
				  employee ceases to be employed by the employer and is not an employee of any
				  other public school of the State, even though the employee may continue to be
				  employed by a related employer that is another unit of the State that is not a
				  public school or in a capacity that is not employment with a public
				  school.
"Spouse" means the individual that is the participant's
				  spouse under applicable law and includes a civil union partner, except where
				  Federal law requires a different definition for compliance with the Internal
				  Revenue Code.
"State colleges" means the colleges so described in Chapter
				  64 of Title 18A of the New Jersey Statutes.
"Treasurer" means the Treasurer of the State of New Jersey.
				  In the event there is no Treasurer then serving, the Acting Treasurer shall
				  perform the functions described in this chapter.
"University Hospital" means the principal teaching hospital
				  of the New Jersey Medical School, New Jersey Dental School, and any other
				  medical education programs located in Newark, pursuant to the terms of
				  P.L.
				  2012, c. 45. ABP
				  membership eligibility at this employing location applies only to those
				  individuals employed by the former University of Medicine and Dentistry of New
				  Jersey on June 30, 2013, who became employees of University Hospital on July 1,
				  2013, under special provisions of
				  P.L.
				  2012, c. 45. All other
				  employees of University Hospital are not eligible to participate in the
				  ABP.
"University of Medicine and Dentistry" or "UMDNJ" means the
				  University of Medicine and Dentistry of New Jersey established pursuant to the
				  terms of section 3 of P.L. 1970, c. 102 (
18A:64G-3
).
				  Operations of the UMDNJ were merged with or transferred to Rutgers, the State
				  University, Rowan University, or University Hospital on July 1, 2013, pursuant
				  to the terms of
				  P.L.
				  2012, c. 45.
"Valuation date" means any day on which both the NYSE is open
				  for regular trading and the applicable designated service provider is open for
				  regular business at its principal office.
A valuation date ends at the earliest of:
1. 4:00 P.M. New York time;
2. The time that the NYSE closes trading; or
3. The time that any investment option must value its assets
				  and price its shares.
In addition, the Plan Administrator may make reasonable rules
				  governing the time of day after which an instruction will be treated as
				  received on the next valuation date.