AN ACT Relating to the state retirement system; amending RCW 41.40.670 and 41.54.010; adding new sections to chapter 41.40 RCW; adding a new section to chapter 41.50 RCW; making an appropriation; providing an effective date; and declaring an emergency.

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

Sec. 1. Section 8, chapter 295, Laws of 1977 ex. sess. as amended by section 5, chapter 18, Laws of 1982 and RCW 41.40.670 are each amended to read as follows:

(1) A member of the retirement system who becomes totally incapacitated for continued employment by an employer as determined by the department ((~~upon recommendation of the retirement board~~)) shall be eligible to receive an allowance under the provisions of RCW 41.40.610 through 41.40.740. Such member shall receive a monthly disability allowance computed as provided for in RCW 41.40.620 and shall have such allowance actuarially reduced to reflect the difference in the number of years between age at disability and the attainment of age sixty-five.

Any member who receives an allowance under the provisions of this section shall be subject to such comprehensive medical examinations as required by the department. If such medical examinations reveal that such a member has recovered from the incapacitating disability and the member is offered reemployment by an employer at a comparable compensation, such member shall cease to be eligible for such allowance.

(2) A member who has completed the forms necessary to initiate the process under subsection (1) of this section and dies prior to final approval shall qualify under this section for an earned disability retirement.

(3) The retirement for disability of a judge, who is a member of the retirement system, by the supreme court under Article IV, section 31 of the Constitution of the state of Washington (House Joint Resolution No. 37, approved by the voters November 4, 1980), with the concurrence of the ((~~retirement board~~)) director, shall be considered a retirement under subsection (1) of this section.

Sec. 2. Section 1, chapter 192, Laws of 1987 as amended by section 1, chapter 195, Laws of 1988 and RCW 41.54.010 are each amended to read as follows:

The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.

(1) "Base salary" means salaries or wages earned by a member of a system during a payroll period for personal services and includes wages and salaries deferred under provisions of the United States internal revenue code, but shall exclude overtime payments, nonmoney maintenance compensation, and lump sum payments for deferred annual sick leave, unused accumulated vacation, unused accumulated annual leave, any form of severance pay, any bonus for voluntary retirement, any other form of leave, or any similar lump sum payment.

(2) "Department" means the department of retirement systems.

(3) "Director" means the director of the department of retirement systems.

(4) "Dual member" means a person who (a) is or becomes a member of a system on or after July 1, 1988, (b) has been a member of one or more other systems, and (c) has never been retired for service from a retirement system and is not receiving a disability retirement or disability leave benefit from any retirement system listed in RCW 41.50.030 or subsection (6) of this section.

(5) "Service" means the same as it may be defined in each respective system. For the purposes of RCW 41.54.030, military service granted under RCW 41.40.170(3) or 43.43.260 may only be based on service accrued under chapter 41.40 or 43.43 RCW, respectively.

(6) "System" means the retirement systems established under chapters 41.32, 41.40, 41.44, and 43.43 RCW and the city employee retirement systems for Seattle, Tacoma, and Spokane. The inclusion of an individual first class city system is subject to the procedure set forth in RCW 41.54.060.

NEW SECTION. Sec. 3. A new section is added to chapter 41.40 RCW to read as follows:

Any active member of this system who has previously established five or more years service credit in the city of Seattle's police relief and pension fund system, who withdrew his or her contributions from Seattle's police relief and pension fund system prior to July 1, 1961, and who has never been a member of the law enforcement officers' and fire fighters' pension system created in chapter 41.26 RCW, may receive credit in this system for such service, subject to the terms and conditions specified in section 4 of this act.

NEW SECTION. Sec. 4. A new section is added to chapter 41.40 RCW to read as follows:

(1) A member who fulfills the requirements of section 3 of this act may file a written declaration no later than September 30, 1989, with the department and the Seattle police relief and pension fund system indicating the member's desire to make an irrevocable transfer of credit from the Seattle system to this system. The member shall restore his or her contributions, with interest since the date of withdrawal as determined by the director, no later than December 31, 1989.

(2) Upon receipt of the written declaration the Seattle police relief and pension fund system shall send the department a report of the member's service credit. It shall also transfer to the department employer contributions in an amount equal to the cost of the benefit provided to the member pursuant to sections 3 and 4 of this act, as determined by the director. The Seattle police relief and pension fund system shall send the service credit report and transfer of employer contributions within ninety days of receiving the member's written declaration.

NEW SECTION. Sec. 5. A new section is added to chapter 41.50 RCW to read as follows:

Beginning with disability benefits, the department shall prepare booklets or other similar publications which will give members of the individual retirement systems specified under RCW 41.50.030, a clear and easily understood description of:

(1) The individual benefits under these systems and the necessary procedural steps which may be required to obtain these benefits; and

(2) The funding of the respective systems, including the interest applied to member accounts.

Such booklets and publications will be distributed to each employee. Employers shall cooperate in the distribution to employees of such material.

NEW SECTION. Sec. 6. The sum of fifty thousand dollars, or as much thereof as may be necessary, is appropriated for the biennium ending June 30, 1991, from the retirement systems' expense fund to the department of retirement systems for the purposes of preparing and distributing the publications specified under section 3 of this act.

NEW SECTION. Sec. 7. (1) This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect July 1, 1989.

(2) Section 1 of this act shall be retroactive to July 1, 1988.