SENATE BILL REPORT

                   HB 1102

              As Reported By Senate Committee On:

                  Ways & Means, April 2, 1997

Title:  An act relating to retirement benefits based on the definition of excess compensation.

Brief Description:  Retirement benefits based on excess compensation.

Sponsors:  Representatives Lambert, H. Sommers, Cooke, Carlson, Conway, Ogden and Mason; by request of Joint Committee on Pension Policy.

Brief History:

Committee Activity:  Ways & Means:  4/2/97 [DP].

SENATE COMMITTEE ON WAYS & MEANS

Majority Report:  Do pass.

  Signed by Senators West, Chair; Deccio, Vice Chair; Strannigan, Vice Chair; Bauer, Brown, Fraser, Hochstatter, Kohl, Loveland, McDonald, Rossi, Schow, Sheldon, Snyder, Swecker, Thibaudeau, Winsley and Zarelli.

Staff:  Debrah Kime (786-7454)

Background: The compensation used for purposes of determining a state retirement system member=s pension is generally defined as salaries and wages payable for services rendered to the employer.  Annual leave cash-outs can be included in the earnable compensation of Public Employees Retirement System (PERS) Plan I and Teachers Retirement System (TRS) Plan I members.  Members of PERS II, TRS II, and both of the Law Enforcement Officers and Fire Fighters Retirement System plans may not include any cash-outs in their earnable compensation.

AExcess compensation@ is all earnable compensation used in the calculation of the retirement benefit except regular salary, overtime compensated at up to twice the regular rate of pay, and annual leave cash-outs not in excess of 240 hours.

Payments subject to Aexcess compensation@ charges include everything except Aregular salary,  overtime, and cash-outs of up to 240 hours or annual leave.@  Included in the definition of excess compensation are:

-cash-outs for sick or any other type of leave;

- payments for, or in lieu of, personal expenses or a transportation allowance;

-termination or severance payments;

-payments added to regular wages concurrent with reduction of annual leave; and

-the portion of any payment, including overtime, that exceeds twice the employee=s regular rate of pay.

Summary of Bill:  The definition of excess compensation is clarified to include only those types of payments that are currently specifically listed in statute.

Appropriation:  None.

Fiscal Note:  Requested on January 20, 1997.

Effective Date:  Ninety days after adjournment in the session which bill is passed.

Testimony For:  None.

Testimony Against:  None.

Testified:  No one.