CERTIFICATION OF ENROLLMENT

 

                   ENGROSSED HOUSE BILL 1131

 

 

                   Chapter 233, Laws of 1995

 

                         (partial veto)

 

 

 

                        54th Legislature

                      1995 Regular Session

 

 

         STATE RETIREMENT SYSTEMS‑-ECONOMIC ASSUMPTIONS

 

 

                    EFFECTIVE DATE:  5/5/95

Passed by the House March 14, 1995

  Yeas 98   Nays 0

 

 

 

CLYDE BALLARD

 

Speaker of the

      House of Representatives

 

Passed by the Senate April 7, 1995

  Yeas 41   Nays 0

             CERTIFICATE

 

I, Timothy A. Martin, Chief Clerk of the House of Representatives of the State of Washington, do hereby certify that the attached is ENGROSSED HOUSE BILL 1131 as passed by the House of Representatives and the Senate on the dates hereon set forth.

 

 

 

JOEL PRITCHARD

 

President of the Senate

TIMOTHY A. MARTIN

 

                          Chief Clerk

 

 

Approved May 5, 1995, with the exception of section 2, which is vetoed. Place Style On Codes above, and Style Off Codes below.

                                FILED          

 

 

             May 5, 1995 - 10:03 a.m.

 

 

 

    MIKE LOWRY

Governor of the State of Washington

                   Secretary of State

                  State of Washington


          _______________________________________________

 

                     ENGROSSED HOUSE BILL 1131

          _______________________________________________

 

             Passed Legislature - 1995 Regular Session

 

State of Washington      54th Legislature     1995 Regular Session

 

By Representatives Silver and G. Fisher; by request of Office of the Forecast Council

 

Read first time 01/13/95.  Referred to Committee on Appropriations.

 

Changing provisions relating to economic assumptions for actuarial studies and retirement contribution rates.



    AN ACT Relating to economic assumptions for state retirement systems; amending RCW 41.45.030 and 41.45.060; repealing RCW 41.45.040 and 41.45.0601; and declaring an emergency.

 

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

 

    Sec. 1.  RCW 41.45.030 and 1993 c 519 s 17 are each amended to read as follows:

    (1) Beginning September 1, ((1989)) 1995, and every ((six)) two years thereafter, the state actuary shall submit to the council information regarding the experience and financial condition of each state retirement system.  The council shall review this and such other information as it may require.

    (2) By December 31, 1995, and every two years thereafter, the council, by affirmative vote of five council members, shall ((review the information submitted by the state actuary and shall)) adopt the following long-term economic assumptions:

    (a) Growth in system membership;

    (b) Growth in salaries, exclusive of merit or longevity increases;

    (c) Growth in inflation; and

    (d) Investment rate of return.

    The council shall work with the department of retirement systems, the state actuary, and the executive director of the state investment board, and shall consider long-term historical averages, in developing the economic assumptions.

    (3) The assumptions adopted by the council shall be used by the state actuary in conducting ((valuation)) all actuarial 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.))The text of the following section has been vetoed by the Governor.  It is noted in bold italic.

 

    *Sec. 2.  RCW 41.45.060 and 1993 c 519 s 19 are each amended to read as follows:

    (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 determined in the 1991 valuations prepared by the office of the state actuary.)) The state actuary shall provide actuarial valuation results based on the assumptions adopted under RCW 41.45.030.

    (2) Not later than September 30, ((1994)) 1996, and every two years thereafter((:

    (a))), consistent with the assumptions adopted under RCW 41.45.030, 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))) both:  (a) A basic state contribution rate for the law enforcement officers' and fire fighters' retirement system; and (b) basic employer contribution rates for the public employees' retirement system plan I, the teachers' retirement system plan I, and the Washington state patrol retirement system to be used in the ensuing biennial period.

    (3) The employer and state contribution rates adopted by the council shall be the level percentages of pay that 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 RCW 41.40.650, 41.32.775, and 41.26.450, respectively.

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

*Sec. 2 was vetoed.  See message at end of chapter.

 

    NEW SECTION.  Sec. 3.  The following acts or parts of acts are each repealed:

    (1) RCW 41.45.040 and 1993 c 519 s 18 & 1989 c 273 s 4; and

    (2) RCW 41.45.0601 and 1993 c 519 s 20 & 1992 c 239 s 1.

 

    NEW SECTION.  Sec. 4.  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.


    Passed the House March 14, 1995.

    Passed the Senate April 7, 1995.

Approved by the Governor May 5, 1995, with the exception of certain items which were vetoed.

    Filed in Office of Secretary of State May 5, 1995.


 

    Note: Governor's explanation of partial veto is as follows:

 

    "I am returning herewith, without my approval as to section 2, Engrossed House Bill No. 1131 entitled:

 

"AN ACT Relating to economic assumptions for state retirement systems;"

 

    Engrossed House Bill No. 1131 requires the Economic and Revenue Forecast Council to adopt long term economic assumptions for pension rate calculation purposes every two years instead of the current six year cycle.  I strongly favor the direction this bill takes in providing for additional pension contribution rate stability.  However, detailed and specific language preferable to that of section 2 exists in section 309 of Engrossed Substitute House Bill No. 1206, relating to retirement systems restructuring.  These sections cannot properly be merged.

 

    For this reason, I have vetoed section 2 of Engrossed House Bill No. 1131.

 

    With the exception of section 2, Engrossed House Bill No. 1131 is approved."