WEST VIRGINIA CODE











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WVC 5-

CHAPTER 5. GENERAL POWERS AND AUTHORITY OF THE GOVERNOR, SECRETARY OF STATE AND ATTORNEY GENERAL; BOARD OF PUBLIC WORKS; MISCELLANEOUS AGENCIES, COMMISSIONS, OFFICES, PROGRAMS, ETC.

WVC -10B-

ARTICLE 10B. GOVERNMENT EMPLOYEES DEFERRED COMPENSATION PLANS.







WVC 5 - 10 B- 1

§5-10B-1. Legislative purpose.

The legislative purpose of this enactment is to enable

employees of the state, its agencies, counties, municipalities and

political subdivisions of such governmental bodies to participate

in voluntary deferred compensation plans authorized by the United

States Internal Revenue Code as interpreted by the Internal Revenue

Service, thereby permitting such employees to obtain the advantages

inherent in such plans relative to the income tax treatment of the

contributions and disbursements made pursuant to such voluntary

income deferment plans. It is further the purpose of this

enactment to authorize the establishment of separate plans for the

state and its agencies and for counties, municipalities and

political subdivisions within the state and to authorize county,

municipal and political subdivision employees to participate in the

state deferred compensation plan if their employer does not have a

plan.







WVC 5 - 10 B- 2

§5-10B-2. Definitions.

Unless the context in which used clearly indicates a different

meaning, as used in this article:

(a) "Board" means the Consolidated Public Retirement Board

provided for in article ten of this chapter.

(b) "Deferred compensation" means the income and earnings on

that income an employee may legally defer for personal income tax

purposes pursuant to the Internal Revenue Code until distribution.

(c) "Deferred compensation plan" or "plan" means a trust

whereby the state employer or a public employer agrees with an

employee for the voluntary reduction in employee compensation for

the payment of benefits by the state employer or the public

employer to the employee at a later date pursuant to this article

and the federal laws and regulations relating to eligible state

deferred compensation plans as described in Section 457 of the

Internal Revenue Code.

(d) "Deferred compensation trust fund" or "trust" means the

fund in which deferred amounts and investment income of

participating employees are held.

(e) "Employee" means any person, whether appointed, elected or

under contract, providing services for the state employer or public

employer for which compensation is paid.

(f) "Internal Revenue Code" means the Internal Revenue Code of

1986, as it has been amended.

(g) "Investment product" means any fixed or variable rate annuity, life insurance contract, savings account, certificate of

deposit, money market account, bond, mutual fund or any other form

of investment not prohibited under the Internal Revenue Code and

authorized by the state employer or the public employer for the

purpose of receiving funds under a plan.

(h) "Public employer" means counties, municipalities or

political subdivisions of those governmental bodies which meet the

definition of "state" as described in Internal Revenue Code Section

457 (d)(1), but which do not meet the definition of "state

employer" as used in this article.

(i) "State employer" means the State of West Virginia, which

includes every state board, commission, agency and instrumentality.

(j) "Treasurer" means the State Treasurer.

(k) "Vendor" means a private entity that sells investment

products or provides goods and services.







WVC 5 - 10 B- 3

§5-10B-3. Powers; contracts; meetings.

(a) Notwithstanding any provision of this code to the

contrary, including, without limitation, this chapter and chapter

five-a of this code, the state employer and a public employer have

the power necessary or appropriate to carry out the provisions and

objectives of this article and to operate the trust, including,

without limitation, entering into contracts and executing and

delivering instruments; engaging consultants, auditors, counsel,

managers, advisors, trustees or any other contractors or

professionals; and charging and collecting administrative fees.

(b) The state employer or any public employer may, by

contract, agree with any of its employees to defer and hold in

trust any portion of that employee's compensation and may

subsequently purchase or acquire from vendors licensed to do

business in the State of West Virginia investment products for the

purpose of carrying out the objectives of the deferred compensation

plan as described in this article.

(c) Employees are authorized to attend meetings called by the

state employer or public employer for the purpose of explaining a

plan during regular working hours.







WVC 5 - 10 B- 3 A

§5-10B-3a. Automatic enrollment.

(a) Every state employee commencing work on and after the

first day of July, two thousand seven, shall have a minimum of ten

dollars per pay period of his or her salary deferred to the state

deferred compensation plan unless the state employee provides

written notice declining to participate in accordance with the

Treasurer's guidelines. A state employee may change the

contribution amount or cease participating at any time. An

employee declining participation in the state deferred compensation

plan may elect to participate at a later time.

(b) A political subdivision may establish an automatic

enrollment program in a deferred compensation plan pursuant to this

article. A political subdivision employee may elect to not

participate in the deferred compensation plan at any time and to

change the contribution amount.







WVC 5 - 10 B- 4

§5-10B-4. Responsibility for implementing plans -- Payroll

reductions -- Billing and administration.

(a) The responsibility for implementing the deferred

compensation plan for employees of the state employer shall be

delegated to the board of trustees through the thirtieth day of

June, two thousand six. On the first day of July, two thousand

six, the Treasurer shall manage any deferred compensation plan for

state employees. Any and all records, moneys, contracts, property

and other matters involving deferred compensation plans for state

employees shall transfer on the first day of July, two thousand

six, to the Treasurer.

(b) The responsibility for implementing the deferred

compensation plan for employees of a public employer is delegated

to the county commission of a county, the governing body of a

municipality, as that term is defined in section two, article one,

chapter eight of this code, and, in the case of any other political

subdivision, the board, commission or other similar body

responsible for determining the policy of such political

subdivision. A county commission or a governing body of another

public employer may request the Treasurer authorize its employees

to participate in the state plan instead of implementing its own

plan.

(c) If the governing body has adopted more than one plan, an

employee electing to participate shall also elect the plan or plans

in which he or she desires to participate. When a public employer has not implemented a plan, its employees may participate in the

state plan.

(d) Payroll reductions shall be remitted as specified by the

state employer or public employer for deposit in the trust, in each

instance, by the appropriate payroll officer. The board of

trustees, the Treasurer or appropriately designated local officer,

board or committee of deferred compensation plan may contract with

one or more vendors to provide consolidated billing and all or any

other goods and services needed for a plan.

(e) Plans shall operate without cost to or contribution from

the state employer or public employer except for the incidental

expense of administering the payroll salary reductions and the

remittance thereof.

(f) The state employer and the public employers may charge

fees on plan contributions, total assets, total return or other

selected method as necessary to provide for the administrative

expenses of a plan.







WVC 5 - 10 B- 5

§5-10B-5. Investment of funds.

Notwithstanding any other provision of law to the contrary,

the board, or the Treasurer beginning the first day of July, two

thousand six, as well as the appropriate local officer, board or

committee, designated as responsible for implementing a deferred

compensation plan, is hereby authorized to invest compensation held

pursuant to a deferred compensation plan in investment products.







WVC 5-10B-6

§5-10B-6. Program supplemental.

The deferred compensation plan or plans established pursuant

to this article shall exist and serve in addition to other

retirement, pension or benefit systems established by the state

employer and any public employer. The deferred compensation plan

or plans established by this article shall not supersede, make

inoperative or reduce any benefits provided by the consolidated

retirement system or programs established by the state employer or

any public employer, or any other retirement, pension or benefit

program established by law for the benefit of employees.







WVC 5-10B-7

§5-10B-7. Other benefits unaffected by deferred compensation

plan.

Notwithstanding any other provision of law to the contrary,

any compensation deferred under this article shall be considered

part of an employee's compensation for purposes of any other

employee retirement, pension or benefit program. No deferral of

compensation under any deferred compensation plan shall effect a

reduction of any retirement, pension or other benefit program

provided by law.







WVC 5-10B-8

§5-10B-8. Federal and state income tax.

Notwithstanding any other provision of this article or any

other provision of law to the contrary, any compensation deferred

under any deferred compensation plan shall not be subject to any

federal, state or municipal income tax nor shall any amount of

compensation deferred be included for the purposes of computation

of any such income tax withheld on behalf of any employee.







WVC 5 - 10 B- 9

§5-10B-9. Liabilities of State of West Virginia or political

subdivisions.

The state employer and the public employers shall not incur

any liability for losses suffered or change in value of an

investment product. The financial liability of the state employer

or public employer under any deferred compensation plan shall be

limited in each instance to amounts paid over to the trust but not

invested.







WVC 5 - 10 B- 10

§5-10B-10. Deferred compensation plan funds held in trust.

(a) Notwithstanding anything herein to the contrary, as of the

first day of January, one thousand nine hundred ninety-eight, all

assets and income of all deferred compensation plans created or

administered pursuant to this article shall be held in trust for

the exclusive benefit of participants and their beneficiaries.

(b) The West Virginia Deferred Compensation Trust Fund is

created within the accounts held by the Treasurer or with one or

more financial institutions, vendors or any other entities selected

by the Treasurer for the purpose of managing and investing the

trust. A public employer managing a trust shall create a trust

fund and select one or more financial institutions, vendors or

other entities to hold the trust.

(c) The corpus, assets and earnings of the trust do not

constitute public funds of the state or public employer and are

available solely for carrying out the purposes of this article.

Any contract entered into by or any obligation of the state

employer or a public employer in connection with a plan does not

create or constitute a debt, but is solely an obligation of the

trust.







WVC 5 - 10 B- 10 A

§5-10B-10a. Matching contribution program.

(a) For a period commencing the first day of July, two

thousand seven, and continuing through the thirtieth day of

September, two thousand twelve, the Treasurer is authorized to

establish and operate a savings incentive program pursuant to

section 401(a) of the Internal Revenue Code of 1986, as amended, in

which a state employee participating in the deferred compensation

plan authorized in this article may receive certain matching

contributions pursuant to this section. The Treasurer shall

establish matching program guidelines in accordance with this

article.

(b) To qualify for participation in the matching program, a

state employee shall have contributed to his or her deferred

compensation account not less than ten dollars every pay period

during a fiscal year.

(c) (1) Subject to the limitations provided by subdivision (2)

of this subsection and subsections (e) and (f) of this section, the

Treasurer shall allocate and credit a matching sum of up to

twenty-five percent of the contributions a qualified state employee

made to his or her deferred compensation account during a fiscal

year for a period of up to five fiscal years, which contributions

shall be at least ten dollars in every pay period during the fiscal

year and which matching contributions for any employee shall not

exceed one hundred dollars in any one fiscal year and four hundred

dollars total over the life of the matching program.

(2) The Treasurer shall set the amount of funds a qualified

state employee may receive as a match in accordance with this

section in an amount not to exceed the amount of funds authorized

by the Legislature for this purpose.

(d) The matching contribution shall be remitted annually by

the Treasurer from the West Virginia Deferred Compensation Matching

Fund, which is hereby created, to the employee's account in the

West Virginia Deferred Compensation Trust Fund no later than the

thirtieth day of September each year for the prior fiscal year.

(e) The Treasurer shall not obligate, authorize or pay any

match for which funds are not available in the West Virginia

Deferred Compensation Matching Fund.

(f) Operation of the matching program is contingent upon

funding made available by the West Virginia Legislature and may be

changed or discontinued at any time for a time certain or

indefinitely, as determined by the Legislature or the Treasurer.

The maximum amount of funds that may be expended from the Deferred

Compensation Matching Fund in any one fiscal year is one million

dollars.

(g) On or before the first day of June, two thousand eight,

the unclaimed property administrator shall transfer the amount of

one million dollars from the Unclaimed Property Trust Fund to the

Deferred Compensation Matching Fund for operation of the matching

program.

(h) Moneys in the Deferred Compensation Matching Fund may be invested, in whole or in part, with the West Virginia Board of

Treasury Investments or any other entity the Treasurer selects and

all earnings shall accrue to and be retained by the fund.

(i) The State of West Virginia, the Treasurer and his or her

employees, agents and representatives shall not be liable for any

losses incurred by the Deferred Compensation Matching Fund.

(j) Any moneys remaining in the Deferred Compensation Matching

Fund at the termination of the matching program shall be

transferred to the General Revenue Fund of the state no later than

the thirty-first day of December, two thousand twelve.

(k) Any public employer may elect to operate its own matching

program.







WVC 5 - 10 B- 11

§5-10B-11. Deferred Compensation Administrative Account.

The Deferred Compensation Administrative Account is created in

the accounts of the Treasurer for the purposes of implementing,

operating and maintaining the trust and plan. The account shall

receive all fees charged and collected by the Treasurer under this

article.







WVC 5 - 10 B- 12

§5-10B-12. Confidential information exempt from disclosure.

All information contained in the records maintained pursuant

to this article that would tend to disclose the identity of a

participating employee, including, without limitation, social

security number, account number, address, telephone number, e-mail

address, amounts invested, selected investments, returns and

medical or disability information, are confidential and exempt from

disclosure under the provisions of article one, chapter

twenty-nine-b of this code. Employees and persons authorized by

employees are permitted access to their own information.







WVC 5 - 10 B- 12 A

§5-10B-12a. Disclosure of information to the Treasurer for

operation of the plan.

For purposes of this article, any person or entity with

information pertaining to an employee participating in the state

plan shall disclose to the Treasurer any payroll related

information the Treasurer determines he or she needs for the

operation of the state deferred compensation plan. Disclosure of

the information shall begin upon enactment of this section on a

schedule and under arrangements required by the Treasurer.

Information disclosed pursuant to this section shall be used by the

Treasurer only for the operation of the state plan. The Treasurer

shall treat the information obtained as confidential and shall not

disclose the information except to a vendor providing goods or

services for the plan, who shall also treat the information as

confidential, or as required by law.







WVC 5 - 10 B- 13

§5-10B-13. Moneys not subject to legal process; qualified domestic

relations orders.

     No account, benefit or right, created pursuant to this

article, accrued or accruing, is subject to execution, garnishment,

attachment, sale to satisfy a judgment or order, the operation of

bankruptcy or insolvency laws, or other process of law and shall be

unassignable, except that accounts, benefits and contributions

under the plan are subject to "qualified domestic relations orders"

as that term is defined in Internal Revenue Code §414(p).







WVC 5 - 10 B- 14

§5-10B-14. Roth accounts.

     The Treasurer or any public employer may authorize Roth

accounts within the plan in accordance with the Internal Revenue

Code, including, without limitation, conversions, deferrals,

rollovers and transfers.





Note: WV Code updated with legislation passed through the 2015 Regular Session

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