6108-S.E AMH GRAH 2

ESSB 6108 - H AMD TO H APP COMM AMD (H-5320.5/98) 1097 FAILED 3-04-98

By Representative

     On page 190, after line 8, insert the following:

ASec. 905.  RCW 41.45.060 and 1995 c 239 ' 309 are each amended to read as follows:     

     (1) The state actuary shall provide actuarial valuation results based on the assumptions adopted under RCW 41.45.030.

     (2) Not later than September 30, 1996, and every two years thereafter, consistent with the assumptions adopted under RCW 41.45.030, the council shall adopt 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 plans II and III, and the law enforcement officers' and fire fighters' retirement system plan II in accordance with RCW 41.40.650, 41.26.450, and this section.

     (4) In adopting the rates for the for the 1999-2001 biennium, the council shall exclude from the rate calculation the following amounts:

(a) For the public employees= retirement system plan II rate: one-half of the value of the net assets held in trust for pension benefits in for public employees= retirement system plan II members, multiplied by the amount which the compound average of investment returns on those assets over the previous four state fiscal years exceeds ten percent;

(b) For the teachers= retirement system plan II rate:  one-half of the value of the net assets held in trust for pension benefits for teachers= retirement system plan II members multiplied by the amount which the compound average of investment returns on those assets over the previous four state fiscal years exceeds ten percent;

(c) For the law enforcement officers= and fire fighters retirement system plan I rate: one-half of the value of the net assets held in trust for pension benefits for law enforcement officers= and fire fighters= retirement system plan I members multiplied by the amount which the compound average of investment returns on those assets over the previous four state fiscal years exceeds ten percent;

(d) For the law enforcement officers= and fire fighters retirement system plan II rate: one-half of the value of the net assets held in trust for pension benefits for law enforcement officers= and fire fighters= retirement system plan II members multiplied by the amount which the compound average of investment returns on those assets over the previous four state fiscal years exceeds ten percent; and

(e) For the Washington state patrol retirement system rate:  one-half of the value of the net assets held in trust for pension benefits for Washington state patrol retirement system members multiplied by the amount which the compound average of investment returns on those assets over the previous four state fiscal years exceeds ten percent.

(5)  The aggregate actuarial cost method shall be used to calculate a combined plan II and III employer contribution rate.

     (((5))) (6) 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.

     (((6))) (7) The director of the department of retirement systems shall collect those rates adopted by the council.@

     Renumber remaining sections consecutively.

EFFECT: The amendment excludes certain amounts in the pension trust funds from the calculation of the contribution rates for the 1999-2001 biennium.  With this amendment, the following pension contributions will be higher next biennium than they would be without the amendment: the state contributions to LEOFF Plan I; the state, local government and employee contributions to LEOFF Plan II; the state contributions to the Washington State Patrol retirement system; and the employer (state and local governments) and employee contributions to PERS Plan II and TRS Plan II.