HOUSE BILL REPORT

HB 3007

BYRepresentative Nealey

Relating to notice of employee pension plans provided by third class cities and fourth class municipalities. (t.o.)

House Committe on Local Government

Majority Report:  The substitute bill be substituted therefor and the substitute bill do pass.  (13)

      Signed by Representatives Haugen, Chair; Cooper, Vice Chair; Ferguson, Ranking Republican Member; Horn, Kirby, Nealey, Nelson, Nutley, Phillips, Raiter, Rayburn, Wolfe and Zellinsky.

House Staff:Bill Lynch (786-7092)

AS REPORTED BY COMMITTEE ON LOCAL GOVERNMENT

FEBRUARY 1, 1990

BACKGROUND:

Most local government employees are covered by public pension plans that are subject to state audit.  Some small towns have established unauthorized pension plans for their employees.  There is no current requirement for a town to notify the State Auditor if it provides an employee pension plan or policy that is not administered by the state.

SUMMARY:

SUBSTITUTE BILL:  A town must notify the State Auditor if it provides a pension policy for its employees that is not administered by the state.  The notice must be given at the time the auditor is conducting an audit of the town.

No third class city or town may establish a pension plan for its employees that is not administered by the state, except that any defined contribution plan that is in existence as of January 1, 1990 is authorized.

SUBSTITUTE BILL COMPARED TO ORIGINAL:  The original bill applied only to towns and did not expressly prohibit the establishment of plans that are not administered by the state.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Stan Finkelstein, Association of Washington Cities.

House Committee - Testified Against:      No one.

House Committee - Testimony For:    This grandfathers the small number of cities that offer pension plans not administered by the state, and prohibits the establishment of any other ones.

House Committee - Testimony Against:      None.