- Primary Sponsor
- Session
- Regular Session 2021
- Title
- Birmingham Retirement and Relief System, amended to revise, effective July 1, 2021, certain contribution rates, eligibility requirements, maximum normal retirement benefit, ordinary disability allowance, spousal survivor benefits, and early retirement benefits, Secs. 45-37A-51.190, 45-37A-51.192, 45-37A-51.196, 45-37A-51.220, 45-37A-51.221, 45-37A-51.222, 45-37A-51.225, 45-37A-51.228, 45-37A-51.232, 45-37A-51.244, 45-37A-51.302, 45-37A-51.305, 45-37A-51.306, 45-37A-51.307, 45-37A-51.308 am'd.
- Summary
HB510 updates the Birmingham Retirement and Relief System by changing how much participants and the city contribute and by revising retirement, disability, survivor, and early retirement benefits for new participants starting July 1, 2021.
What This Bill Does
It sets participant contributions at 7.5% of monthly salary and requires the city and participating subsidiaries to contribute enough to fully fund the system and pay down unfunded liabilities within 30 years, as determined by the actuary. It changes retirement rules for participants who join on or after July 1, 2021 (excluding fire and police) to require either age 62 with 10+ years or age 55 with 30+ years for normal retirement, and lowers the normal retirement benefit from 2.25% to 1.75% of final average salary per year of service (with a max of 52.5% of final average salary). It reduces ordinary disability benefits to 1.75% and revises spousal survivor options for new participants to remove subsidized survivor benefits, offering an actuarially reduced retirement option to provide a survivor benefit. It lowers the early retirement benefit from 1.85% to 1.45% and expands vesting rules (5 years for pre-2017 participants; 10 years for those after 2017). The changes also apply to various city entities (library board, civic center, airport authority, emergency management district, and civil defense agency) regarding contributions and participation.
Who It Affects
- BRRS participants who first become participants on or after July 1, 2021 (excluding fire and police) — face new retirement eligibility, lower retirement and early retirement percentages, and revised survivor options.
- City of Birmingham and participating subsidiaries (e.g., board of health, library board, civic center, Birmingham Airport Authority, Birmingham Emergency Management Agency/district, civil defense agency) — must implement 7.5% participant deductions and make actuarially determined employer contributions to fully fund the system and amortize unfunded liabilities.
- Survivors and spouses of participants with new eligibility rules — may have revised survivor benefits or opt for actuarially reduced retirement to provide a survivor benefit.
Key Provisions
- Participants' contribution rate increased to 7.5% of actual monthly salary starting July 1, 2021.
- Employer contributions (city and participating subsidiaries) must be actuarially determined each year to fully fund the system and amortize unfunded liabilities within 30 years (starting July 1, 2021).
- Normal retirement eligibility for new participants (after July 1, 2021; excluding fire/police): either age 62+ with 10+ years or age 55+ with 30+ years.
- Normal retirement benefit formula for new participants reduced from 2.25% to 1.75% of final average salary per year of service; maximum normal retirement benefit capped at 52.5% of final average salary.
- Ordinary disability allowance for new participants reduced from 2% to 1.75% of final average salary times years of service; maximum limits preserved.
- Legally married new participants must elect between a spousal survivor benefit (with a reduced retirement benefit) or an unreduced retirement with no survivor benefit; subsidized survivor benefits removed for new participants.
- Firefighters’ and police officers’ supplemental system for new participants removes subsidized spousal survivor benefits and allows an actuarially reduced retirement to provide a survivor benefit.
- Early retirement benefit for new participants reduced from 1.85% to 1.45% of final average salary times years of service.
- Vesting changes: participants who joined before July 1, 2017 vest at 5 years; those who joined on/after July 1, 2017 vest at 10 years.
- Provisions extend to and require participation and contributions from the Birmingham Library Board, Airport Authority, Emergency Management Agency/District, and Civil Defense Agency under the BRRS framework.
AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.
