HOUSE BILL REPORT

EHB 2763

BYRepresentatives Locke and May

Refunding retirement contributions for certain judges.

House Committe on Appropriations

Majority Report:  Do pass as amended.  (25)

      Signed by Representatives Locke, Chair; Grant, Vice Chair; Silver, Ranking Republican Member; Youngsman, Assistant Ranking Republican Member; Appelwick, Belcher, Bowman, Braddock, Brekke, Dorn, Doty, Ebersole, Hine, Inslee, May, McLean, Nealey, Padden, Peery, Rust, Sayan, Spanel, Valle, Wang and Wineberry.

House Staff:Randy Acker (786-7130)

AS PASSED HOUSE FEBRUARY 12, 1990

BACKGROUND:

Membership in the Judicial Retirement System (JRS) was mandatory for any judge elected or appointed to the Superior Court, Court of Appeals, or Supreme Court between August 9, 1971, and July 1, 1988.  Members contributed seven and a half percent of salary and became vested after 10 years of service.

Contributions were made on a tax deferred basis.  At the time JRS was created, contributions could be treated as tax deferred only if those contributions could never be refunded.  Based on this, no provision was included to permit contribution refunds.  Since 1984, due to changes in federal tax law, contributions may be made on a tax deferred basis and later refunded.

In order to recover contributions, former members of JRS, who did not work the 10 years necessary for vesting, filed numerous claims for return of contributions through the sundry claims process.  Only two claims are known to have been paid through sundry claims.

Legislation was enacted during the 1988 session reforming the Judicial Retirement System. Among various other provisions, members were permitted to transfer membership into the Public Employees Retirement System (PERS) Plan II between July 1, 1988, and December 31, 1989.  All judges elected or appointed on or after July 1, 1988, become members of PERS. PERS members are eligible to receive a refund of contributions.

SUMMARY:

A judge, who was a member of the Judicial Retirement System or the Judges Retirement System, or the surviving spouse of such a judge, may upon application, receive a refund of the judge's contributions to the system if:  1) the judge left the system before July 1, 1988, 2) the judge was not eligible to receive a benefit from the system, and 3) neither the spouse nor the judge received an amount under a sundry claims appropriation intended as a refund of the judge's retirement contributions.

Fiscal Note:      Requested January 5, 1990.

House Committee ‑ Testified For:    Donald Horowitz, former Superior Court Judge; and Jerome Farris, former Superior Court Judge.

House Committee - Testified Against:      No one.

House Committee - Testimony For:    This bill will allow judges who did not vest in the Judicial Retirement System to receive a refund of their contributions.

House Committee - Testimony Against:      None.