H-2003              _______________________________________________

                                                   HOUSE BILL NO. 1104

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State of Washington                              50th Legislature                              1987 Regular Session

By Representatives Unsoeld, Belcher, Jacobsen, Lux, Schoon, Winsley, P. King, Basich and Hankins

Read first time 2/25/87 and referred to Committee on Ways & Means.

AN ACT Relating to providing an automatic annual increase, with a maximum of three percent, to the minimum public retirement benefit; adding a new section to chapter 41.32 RCW; adding a new section to chapter 41.40 RCW; providing an effective date; and declaring an emergency.

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

NEW SECTION. Sec. 1.  A new section is added to chapter 41.32 RCW to read as follows:

          Beginning July 1, 1987, and every year thereafter, the department shall determine the following information for the minimum retirement allowance provided by RCW 41.32.485(1):

          (1) The dollar amount of the minimum retirement allowance as of July 1, 1987;

          (2) The index for the 1986 calendar year, to be known as "index A";

          (3) The index for the calendar year prior to the date of determination, to be known as "index B"; and

          (4) The ratio obtained when index B is divided by index A.

          The value of the ratio obtained shall be the annual adjustment to the minimum retirement allowance and shall be applied beginning with the July payment.  In no event, however, shall the annual adjustment:

          (a) Produce a retirement allowance which is lower than the minimum retirement allowance as of July 1, 1987;

          (b) Exceed three percent in the initial annual adjustment; or

          (c) Differ from the previous year's annual adjustment by more than three percent.

          For the purposes of this section, "index" means, for any calendar year, that year's average consumer price index‑-Seattle, Washington area for urban wage earners and clerical workers, all items, compiled by the bureau of labor statistics, United States department of labor.

NEW SECTION. Sec. 2.  A new section is added to chapter 41.40 RCW to read as follows:

          Beginning July 1, 1987, and every year thereafter, the department shall determine the following information for the minimum retirement allowance provided by RCW 41.40.198(2):

          (1) The dollar amount of the minimum retirement allowance as of July 1, 1987;

          (2) The index for the 1986 calendar year, to be known as "index A";

          (3) The index for the calendar year prior to the date of determination, to be known as "index B"; and

          (4) The ratio obtained when index B is divided by index A.

          The value of the ratio obtained shall be the annual adjustment to the minimum retirement allowance and shall be applied beginning with the July payment.  In no event, however, shall the annual adjustment:

          (a) Produce a retirement allowance which is lower than the minimum retirement allowance as of July 1, 1987;

          (b) Exceed three percent in the initial annual adjustment; or

          (c) Differ from the previous year's annual adjustment by more than three percent.

          Persons who served as elected officials and whose accumulated employee contributions and credited interest were less than seven hundred fifty dollars at the time of retirement shall not receive the benefit provided by this section.

          For the purposes of this section, "index" means, for any calendar year, that year's average consumer price index‑-Seattle, Washington area for urban wage earners and clerical workers, all items, compiled by the bureau of labor statistics, United States department of labor.

NEW SECTION. Sec. 3.     This act is necessary for the immediate preservation of the public peace, health, and safety, the support of the state government and its existing public institutions, and shall take effect July 1, 1987.