General

2007 Legislative Session

Page Last Updated: June 15, 2007

Select Committee on Pension Policy (SCPP) Bills Washington State Law Enforcement Officers' and Fire Fighters' Plan 2 Retirement Board Bills Other Pension Related Bills

Click on the bill number for more detailed information about the passed legislation.

Select Committee on Pension Policy (SCPP) Bills – Signed by Governor

House Bill Number Senate Bill Number Title
  SB 5175

Age 66 COLA

This bill would give a retiree, after being retired one year, the annual COLA adjustment in July if the member turns 66 years of age any time in the current calendar year.

  SB 5014

Contribution Rate Adoption

This bill changes the active and retired valuation reporting to a July 1 to June 30 (fiscal year) cycle for all retirement systems and plans.

  1. The State Actuary will submit both preliminary and final valuation results. Preliminary results will be submitted before the Pension Funding Council (PFC) rate-adoption process. Final results will be submitted after the PFC acts and will incorporate the PFC actions.
  2. The PFC will be required to submit preliminary audit results to the SCPP at least 30 days prior to the PFC's action on contribution rates.
  3. The State Actuary will be required to calculate member rates based on the employer rates adopted by the PFC.
  4. The PFC and LEOFF 2 Retirement Board will adopt rates by July 31 of even-numbered years instead of by September 30.
  5. The PFC will have the flexibility to require annual rate changes instead of fixed rates for any rate-setting period.
  6. Economic assumptions would be evaluated in odd-numbered years instead of every four years, and in the fall instead of the spring, beginning in the fall of 2007. The PFC will retain its authority to adopt rates which may or may not include the demographic assumptions recommended by the State Actuary. The PFC would also retain its authority to audit the experience studies (which form the basis for many of the demographic assumptions).
  SB 5174

Corrections

This bill makes technical corrections necessitated by changes to Washington’s public pension law in recent years. The majority of corrections concern implementation of the new Public Safety Employees' Retirement System (PSERS).

HB 1264  

Dual Membership

This bill impacts all state retirement systems and plans, with the exception of LEOFF Plan 1, and impacts the first class city employee retirement systems for Seattle, Tacoma and Spokane. The bill changes portability of public retirement benefits as follows:

  • Reportable Compensation – Allows compensation that is reportable in all dual member systems to be included in the calculation of all dual members’ benefits, except in the Washington State Patrol Retirement System.
  • Indexing – Adds LEOFF Plan 2 to the plans that are able to combine service under portability to receive indexing of the term-vested benefit for members with at least 20 years of service.
  • Service Cap – Removes the “maximum benefit rule” for dual members who have less than 15 years of service in one capped plan and service in one uncapped plan.
HB 1266  

Expanding/Indexing $150,000 Death Benefits

This bill standardizes the $150,000 benefit for all systems by extending eligibility to include death from occupational disease or duty-related illness. Also, the refund of contributions that a PERS Plan 2 member's survivor may receive, if the member leaves eligible employment after earning 10 years of service credit and is subsequently killed while participating in uniformed services of the United States in Operation Enduring Freedom or Persian Gulf, Operation Iraqi Freedom is increased from 100 to 200 percent of the accumulated contributions in the member's account.

HB 1262  

Post Retirement Employment

For TRS Plan 1 members and employers, this bill prohibits prior re-employment agreements and requires documentation of need and of the hiring process. The bill increases the waiting period to one and a half months before a TRS Plan 1 retiree can return to work and it implements a lifetime limit of 1,900 hours. Any hours worked over 867 in a year while a TRS Plan 1 retiree is receiving a pension will be applied to the lifetime limit. These provisions are consistent with those that are currently a part of PERS Plan 1.

HB 1261  

Purchase of Temporary Duty Disability Service Credit

This bill standardizes the temporary duty disability provisions for members of PERS, SERS, TRS, PSERS and LEOFF Plan 2 to allow the purchase of up to 24 consecutive months of service credit for each period of temporary duty disability.

HB 1260  

Washington State Patrol Contribution Rates

This bill changes the formula used to establish member and employer contribution rates in the Washington State Patrol Retirement System, effective July 1, 2007. Members would pay the lesser of one-half of the adjusted total contribution rate or seven percent. In addition, members would pay one-half the cost of any benefit improvements effective on or after July 1, 2007. It also establishes a formula to develop minimum member contribution rates beginning July 1, 2009. The bill is null and void if both Senate Bill 6129 and Senate Bill 5937 are not enacted by June 30, 2007, as they provide additional revenue for the Washington State Patrol Highway Account.


Washington State Law Enforcement Officers' and Fire Fighters' Plan 2 Retirement Board Bills – Signed by Governor

House Bill Number Senate Bill Number Title
HB 1680  

Exception to the Service Credit Transfer Waiting Period for EMTs

Legislation passed in 2003 and 2005 allowed Emergency Medical Technicians (EMT) to join LEOFF Plan 2. EMTs were also given the choice to transfer their prior PERS service credit into LEOFF Plan 2. The transfer of service credit could only occur five years after the member elected to transfer. This bill creates an exception to the five-year waiting period for members who die or retire due to disability.

HB 1679  

LEOFF 2 Board Membership

Under this bill, the terms of employer representatives on the board will be staggered so that no more than one position will expire in the same year. Legislative terms will be two years and run from January through December. After January 1, 2008, one member of the Board must be a retired LEOFF Plan 2 participant.


Other Pension Related Bills – Signed by Governor

House Bill Number Senate Bill Number Title
HB 1124  

Add DNR to PSERS Employers

This bill amends the definition of employer in the Public Safety Employees' Retirement System (PSERS) to include the Department of Natural Resources (DNR). Existing DNR employees eligible for PSERS will have 90 days to choose PSERS or remain in PERS. Newly hired DNR employees who meet the definition of PSERS will be mandated into PSERS.

HB 1649  

Benefit Multiplier for Past Judicial Service

This bill changes the formula used to calculate the amount judges will pay for prior judicial service. The new formula for each service credit month is: 5% (2.5% for Plan 3) of the salary earned plus 8% interest, compounded monthly. If a judge has purchased prior service before the passage of this act, he or she can have the cost recalculated. If the new cost is less than the amount originally paid, the balance will be returned to the member.

HB 2391  

Gain Sharing Replacement

This bill allows one final gain sharing distribution on January 1, 2008, if the investment return criteria is met. The bill then removes the TRS and PERS Plan 1 gain sharing benefit and the PERS, TRS and SERS Plan 3 gain sharing benefit, replacing them with the following.

For PERS and TRS Plan 1 retirees:

Beginning in July 1, 2009, a cost of living adjustment of 40 cents per month, per year of service, minus the 2008 gain sharing increase to the COLA. The adjustment can't decrease the annual amount of the COLA and it can't exceed 20 cents per month, per year of service.

For PERS, TRS and SERS Plan 2 and Plan 3 members:

A PERS, TRS or SERS Plan 2 or Plan 3 member with 30 years of service who has reached age 55 can choose between the three percent reduction and the 2008 Early Reduction Factor (ERF). The 2008 ERF provides a smaller benefit reduction, including no reduction at age 62, but imposes stricter return to work rules.

Existing ERF Retirement Age New 2008 ERF
Reduction Factor Percent of a Normal Benefit You Receive Reduction Factor Percent of a Normal Benefit You Receive
30% 70% 55 20% 80%
27% 73% 56 17% 83%
24% 76% 57 14% 86%
21% 79% 58 11% 89%
18% 82% 59 8% 92%
15% 85% 60 5% 95%
12% 88% 61 2% 98%
9% 91% 62 0% 100%
6% 94% 63 0% 100%
3% 97% 64 0% 100%

This provision will be effective for PERS Plan 2 and 3 members on July 1, 2008 and effective for TRS and SERS Plan 2 and 3 members on September 1, 2008.

If a court of law should decide the repeal of gain sharing is invalid, any member who qualifies for early retirement but has not yet received his or her first payment under the provisions of the new law will be subject to the reductions for early retirement that were in place before passage of the new law.  In addition, if the court reinstates gain sharing, any new SERS or TRS members hired after the court action would no longer have the choice between Plan 2 and Plan 3 and would be mandated into Plan 3.

  SB 5918

Retirement Benefits for Judges

This bill would allow the application of valid domestic relations orders and IRS levies to the funds of participating members in the Judicial Retirement Account. It would also apply the provisions of Washington's community property laws to certain distributions.

  SB 5313

WSPRS Retirement Age

This bill changes the mandatory Washington State Patrol retirement age from 60 to 65, effective July 1, 2007. The mandatory retirement age, however, does not apply to a member serving as Chief of the Washington State Patrol.

HB 1417  

WSP Survivor Benefits

This bill provides that the retirement allowance paid to the spouse and dependent children of a member of the Washington State Patrol Retirement System who is killed in the course of employment shall include reimbursement for any payments of medical premiums to the Washington State Health Care Authority.