BILL REQ. #:  S-0459.3 

Read first time 01/20/11.   Referred to Committee on Labor, Commerce & Consumer Protection.

     AN ACT Relating to state agency debt collection; amending RCW 41.40.037; adding a new section to chapter 43.17 RCW; and adding a new section to chapter 41.40 RCW.

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

NEW SECTION.  Sec. 1   A new section is added to chapter 43.17 RCW to read as follows:
     (1) All state agencies and institutions shall assign all debts over ninety days past due to a collection agency licensed under chapter 19.16 RCW.
     (2) State agencies and institutions contracting for debt collection services under this section must give preference to businesses that have hired state employees displaced by this section. The department of general administration shall develop a process to certify which businesses meet this requirement.
     (3) Any state employee whose position is displaced as a result of this section shall be eligible for placement on the statewide layoff list for employment by other state agencies. A state employee whose position is displaced as a result of this section and who is not offered employment with the state within ninety days of termination shall receive a severance payment equal to six months of the employee's regular rate of pay at the time of termination.

NEW SECTION.  Sec. 2   A new section is added to chapter 41.40 RCW to read as follows:
     (1) A member whose position was displaced as a result of section 1 of this act after having first earned fifteen years of service credit while working for the state and who is eligible to retire under RCW 41.40.180, 41.40.630, or 41.40.820 may, at the time of filing a written application for retirement with the department, apply to the department for up to five years of additional service credit, subject to the restrictions in this section.
     (2) A member qualifying for service credit under subsection (1) of this section shall receive additional service credit in the amount of five years, to be reduced by one service credit month for every month of employment that the member works for an employer during the five year period immediately following the displacement of the member's job as a result of section 1 of this act. The additional service credit granted to a member under this section shall be provided at no cost to the member.
     (3) Under no circumstances may a member receive more than five years of additional service credit as a result of credit granted under this section and the provisions of RCW 41.40.034. Additional service credit received under this section is not membership service and shall be used exclusively to increase the value of the member's retirement allowance.

Sec. 3   RCW 41.40.037 and 2007 c 50 s 5 are each amended to read as follows:
     (1)(a) If a retiree enters employment with an employer sooner than one calendar month after his or her accrual date, the retiree's monthly retirement allowance will be reduced by five and one-half percent for every eight hours worked during that month. This reduction will be applied each month until the retiree remains absent from employment with an employer for one full calendar month.
     (b) The benefit reduction provided in (a) of this subsection will accrue for a maximum of one hundred sixty hours per month. Any benefit reduction over one hundred percent will be applied to the benefit the retiree is eligible to receive in subsequent months.
     (2)(a) Except as provided in (b) of this subsection, a retiree from plan 1 who enters employment with an employer at least one calendar month after his or her accrual date may continue to receive pension payments while engaged in such service for up to eight hundred sixty-seven hours of service in a calendar year without a reduction of pension.
     (b) A retiree from plan 1 who enters employment with an employer at least three calendar months after his or her accrual date and:
     (i) Is hired pursuant to a written policy into a position for which the employer has documented a justifiable need to hire a retiree into the position;
     (ii) Is hired through the established process for the position with the approval of: A school board for a school district; the chief executive officer of a state agency employer; the secretary of the senate for the senate; the chief clerk of the house of representatives for the house of representatives; the secretary of the senate and the chief clerk of the house of representatives jointly for the joint legislative audit and review committee, the select committee on pension policy, the legislative evaluation and accountability program, the legislative systems committee, and the statute law committee; or according to rules adopted for the rehiring of retired plan 1 members for a local government employer;
     (iii) The employer retains records of the procedures followed and decisions made in hiring the retiree, and provides those records in the event of an audit; and
     (iv) The employee has not already either:
     (A) Rendered a cumulative total of more than one thousand nine hundred hours of service while in receipt of pension payments beyond an annual threshold of eight hundred sixty-seven hours; or
     (B) Received additional service credit under section 2 of this act within the previous five years;
shall cease to receive pension payments while engaged in that service after the retiree has rendered service for more than one thousand five hundred hours in a calendar year. The one thousand nine hundred hour cumulative total under this subsection applies prospectively to those retiring after July 27, 2003, and retroactively to those who retired prior to July 27, 2003, and shall be calculated from the date of retirement.
     (c) When a plan 1 member renders service beyond eight hundred sixty-seven hours, the department shall collect from the employer the applicable employer retirement contributions for the entire duration of the member's employment during that calendar year.
     (d) A retiree from plan 2 or plan 3 who has satisfied the break in employment requirement of subsection (1) of this section may work up to eight hundred sixty-seven hours in a calendar year in an eligible position, as defined in RCW 41.32.010, 41.35.010, 41.37.010, or 41.40.010, or as a firefighter or law enforcement officer, as defined in RCW 41.26.030, without suspension of his or her benefit.
     (3) If the retiree opts to reestablish membership under RCW 41.40.023(12), he or she terminates his or her retirement status and becomes a member. Retirement benefits shall not accrue during the period of membership and the individual shall make contributions and receive membership credit. Such a member shall have the right to again retire if eligible in accordance with RCW 41.40.180. However, if the right to retire is exercised to become effective before the member has rendered two uninterrupted years of service, the retirement formula and survivor options the member had at the time of the member's previous retirement shall be reinstated.
     (4) The department shall collect and provide the state actuary with information relevant to the use of this section for the select committee on pension policy.
     (5) The legislature reserves the right to amend or repeal this section in the future and no member or beneficiary has a contractual right to be employed for more than five months in a calendar year without a reduction of his or her pension.