5888-S

AN ACT Relating to improvement of retirement system benefits; amending RCW 41.54.061, 41.54.040, 41.45.030, 41.45.040, 41.45.060, and 41.45.0601; adding a new section to chapter 41.32 RCW; adding a new section to chapter 41.40 RCW; adding a new section to chapter 41.50 RCW; creating new sections; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

PART I - COST-OF-LIVING ADJUSTMENT EXTENSION

NEW SECTION. Sec. 1. The benefit adjustment granted by sections 711(1) and 712(1), chapter 232, Laws of 1992 (uncodified) being received by plan I beneficiaries as of June 30, 1993, unless otherwise improper, shall be continued through June 30, 1995.

PART II - NEW TEMPORARY COST-OF-LIVING ADJUSTMENT

NEW SECTION. Sec. 2. A new section is added to chapter 41.32 RCW under the subchapter heading "Plan I" to read as follows:

(1) Effective July 1, 1993, through June 30, 1995, the monthly benefit of each plan I beneficiary under this chapter is increased three dollars per month per year of creditable service established by the member, reflecting any actuarial reduction made or survivor option taken, if the beneficiary:

(a) Is not receiving a minimum benefit under RCW 41.32.487 or cost-of-living adjustment under RCW 41.32.575; and

(b) Is at least age seventy; and

(d) Is not a recipient of the temporary disability under RCW 41.32.540.

(2) Any fraction of a year is counted in the computation of this adjustment.

NEW SECTION. Sec. 3. A new section is added to chapter 41.40 RCW under the subchapter heading "Plan I" to read as follows:

(a) Is not receiving a minimum benefit under RCW 41.40.198 or cost-of-living adjustment under RCW 41.40.325; and

(b) Is at least age seventy; and

(2) Any fraction of a year is counted in the computation of this adjustment.

PART III - CITIES' PORTABILITY

Sec. 4. RCW 41.54.061 and 1990 c 192 s 3 are each amended to read as follows:

(1) The cities of Seattle, Spokane, and Tacoma shall each have the option of making an irrevocable election to have its employee retirement system included in the coverage of this chapter by adopting a resolution transmitting it to the director and the joint committee on pension policy prior to December ((~~1, 1990~~)) 31, 1993.

The resolution shall indicate the city's desire to be covered by this chapter and its willingness to pay for the additional cost it may incur as a result of the benefits provided by this chapter.

(2) This chapter shall become effective on January 1, ((~~1991~~)) 1994, for each city which adopts a resolution pursuant to subsection (1) of this section. ((~~However, if all three cities adopt such resolutions prior to June 1, 1990, the provisions of this chapter shall become effective for those systems on July 1, 1990.~~))

Sec. 5. RCW 41.54.040 and 1990 c 192 s 5 are each amended to read as follows:

(1) ((~~Except where subsection (4) of this section applies,~~)) The retirement allowances calculated under RCW 41.54.030 shall be paid separately by each respective current and prior system. Any deductions from such separate payments shall be according to the provisions of the respective systems.

(2) Postretirement adjustments, if any, shall be applied by the respective systems based on the payments made under subsection (1) of this section.

(3) If a dual member dies in service in any system, the surviving spouse shall receive the same benefit from each system that would have been received if the member were active in the system at the time of death based on service actually established in that system. However, this subsection does not make a surviving spouse eligible for the survivor benefits provided in RCW 43.43.270.

(4) The department shall adopt rules under chapter 34.05 RCW to ensure that where a dual member has service in a system established under chapter 41.32, 41.40, 41.44, or 43.43 RCW and service under the city employee retirement system for Seattle, Tacoma, or Spokane, the ((~~entire~~)) additional cost incurred as a result of the dual member receiving a benefit under this chapter shall be borne by the ((~~city~~)) retirement system ((~~that the person is a member of~~)) incurring the additional cost.

PART IV - RETIREMENT CONTRIBUTION RATES

Sec. 6. RCW 41.45.030 and 1989 c 273 s 3 are each amended to read as follows:

(1) ((~~The economic and revenue forecast council shall adopt the economic assumptions used by the state actuary in conducting valuation studies of the state retirement systems.~~

~~(2)~~)) Beginning September 1, 1989, and every six years thereafter, the state actuary shall submit to the council information regarding the experience and financial condition of each state retirement system. (2) The council shall review the information submitted by the state actuary and shall ((recommend any adjustments which may be needed to the state or employer contribution rates contained in RCW 41.45.060 and 41.45.070 for the public employees' retirement system; the teachers' retirement system; the law enforcement officers' and fire fighters' retirement system; and the Washington state patrol retirement system)) adopt the economic assumptions used by the state actuary in conducting valuation studies of the state retirement systems.

(3) The council may utilize information provided by the state actuary and such other information as it may request.

Sec. 7. RCW 41.45.040 and 1989 c 273 s 4 are each amended to read as follows:

(1) The adoption of the economic assumptions and the ((~~recommendation of changes in employer and state~~)) contribution rates as provided in RCW 41.45.060 shall be by affirmative vote of at least five members of the council.

(2) The employer and state contribution rates ((~~recommended~~)) adopted by the council shall be the level percentages of pay which are needed:

(a) To fully amortize the total costs of the public employees' retirement system plan I, the teachers' retirement system plan I, the law enforcement officers' and fire fighters' retirement system plan I, and the unfunded liability of the Washington state patrol retirement system not later than June 30, 2024; and

(b) To also continue to fully fund the public employees' retirement system plan II, the teachers' retirement system plan II, and the law enforcement officers' and fire fighters' retirement system plan II in accordance with the provisions of RCW 41.40.650, 41.32.775, and 41.26.450, respectively.

Sec. 8. RCW 41.45.060 and 1992 c 239 s 2 are each amended to read as follows:

((~~Beginning July~~)) (1) For the period of September 1, 1993, through August 31, 1995, the basic state contribution rate for the law enforcement officers' and fire fighters' retirement system, and the basic employer contribution rates for the public employees' retirement system, the teachers' retirement system, and the Washington state patrol retirement system shall be as ((~~follows:~~

~~(1) 7.47% for all members of the public employees' retirement system;~~

~~(2) 12.60% for all members of the teachers' retirement system;~~

~~(3) 16.44% for all members of the law enforcement officers' and fire fighters' retirement system; and~~

~~(4) 15.53% for all members of the Washington state patrol retirement system~~)) determined in the 1991 valuations prepared by the office of the state actuary.

(2) Not later than September 30, 1994, and every two years thereafter:

(a) The council shall adopt the contributions to be used in the ensuing biennial period for the systems specified in subsection (1) of this section.

(b) The council shall immediately notify the directors of the office of financial management and department of retirement systems of the state and employer contribution rates adopted under (a) of this subsection.

(c) The director of the department of retirement systems shall collect those rates adopted by the council under this chapter.

Sec. 9. RCW 41.45.0601 and 1992 c 239 s 1 are each amended to read as follows:

Beginning September 1, 1992, through ((~~June 30~~)) August 31, 1993, the basic state contribution rate for the law enforcement officers' and fire fighters' retirement system, and the basic employer contribution rates for the public employees' retirement system, the teachers' retirement system, and the Washington state patrol retirement system shall be as follows:

(1) 7.27% for all members of the public employees' retirement system;

(2) 12.08% for all members of the teachers' retirement system;

(3) 12.99% for all members of the law enforcement officers' and fire fighters' retirement system; and

(4) 17.16% for all members of the Washington state patrol retirement system.

NEW SECTION. Sec. 10. A new section is added to chapter 41.50 RCW to read as follows:

The director shall inform all employers in writing as to the employer rates adopted by the economic and revenue forecast council upon the notification of the council as prescribed in RCW 41.45.060.

PART V - MISCELLANEOUS

NEW SECTION. Sec. 11. Part headings as used in this act do not constitute any part of the law.

NEW SECTION. Sec. 12. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect immediately.