SENATE BILL REPORT

SB 6397

As of January 28, 2014

Title: An act relating to retired law enforcement officers and firefighters employed in certain public positions.

Brief Description: Placing restrictions on retired law enforcement officers and firefighters employed in certain public positions.

Sponsors: Senators Liias, Honeyford and Conway; by request of LEOFF Plan 2 Retirement Board.

Brief History:

Committee Activity: Ways & Means:

Staff: Pete Cutler (786-7474)

Background: The Law Enforcement Officers' and Fire Fighters' Retirement System Plan 2 (LEOFF 2) provides retirement benefits to full-time and fully compensated law enforcement officers and firefighters who first entered membership-eligible employment on or after October 1, 1977. Members of LEOFF 2 are eligible for full retirement benefits beginning at age 53.

Prior to 2005, LEOFF 2 retirees who became employed in LEOFF-covered positions, or positions covered by the Public Employees' Retirement System (PERS), the Teachers' Retirement System (TRS), the School Employees' Retirement System (SERS), or the Public Safety Employees' Retirement System (PSERS) could not continue to receive their LEOFF retirement benefits. LEOFF 2 members with at least 15 years of service credit were also generally prohibited from joining a second state retirement system plan if they were receiving or eligible to receive LEOFF 2 retirement benefits. Therefore, prior to 2005 LEOFF 2 retirees could neither collect their pensions, nor earn service credit if they became employed in a PERS, TRS, SERS, or PSERS-covered position.

The LEOFF 2 Board proposed changes to the LEOFF 2 post-retirement employment rules to make it easier for LEOFF 2 members to make career changes after retirement. Changes were enacted in 2005 that allow LEOFF 2 retirees who becomes employed in a non-LEOFF eligible position that is covered by PERS, TRS, SERS, or PSERS to choose to either: (1) receive LEOFF 2 retirement benefits while employed in the non-LEOFF position and be prohibited from entering a new retirement plan; or (2) enter into the membership of the retiree's new position's retirement plan, make contributions and accrue service credit, and have their LEOFF 2 retirement benefit suspended until the employment covered by the other retirement plan ends. LEOFF 2 retiree benefits are suspended when the retiree becomes employed in a LEOFF-eligible position.

Persons who retire from PERS, TRS, SERS, and PSERS Plans 2 and 3 may work in a retirement-eligible position for up to 867 hours each calendar year without suspension of retirement benefits.

Summary of Bill: LEOFF 2 retirees and members are not eligible to receive LEOFF 2 retirement benefits if they become employed in positions that would otherwise be LEOFF-eligible positions except that the positions are less than fulltime, less than fully compensated, not fully commissioned, or include additional duties that make the position not eligible for inclusion in LEOFF.

LEOFF 2 retirees and members are also not eligible to receive retirement benefits if they become employed in positions that would otherwise be covered in LEOFF except that the retiree or member is designated as an independent contractor.

Appropriation: None.

Fiscal Note: Available.

Committee/Commission/Task Force Created: No.

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