HOUSE BILL REPORT
HB 2648
This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent. |
As Passed House:
February 11, 2016
Title: An act relating to an exemption from disclosure of certain financial, commercial, and proprietary information submitted to or obtained by a city retirement board on behalf of its employees' retirement system.
Brief Description: Providing for an exemption from disclosure of certain financial, commercial, and proprietary information held by a city retirement board on behalf of its employees' retirement system.
Sponsors: Representatives Fey, Muri, Kirby, Jinkins, Ryu, Cody, Kilduff, Pettigrew, Riccelli and Bergquist.
Brief History:
Committee Activity:
State Government: 1/28/16, 2/2/16 [DP].
Floor Activity:
Passed House: 2/11/16, 95-1.
Brief Summary of Bill |
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HOUSE COMMITTEE ON STATE GOVERNMENT |
Majority Report: Do pass. Signed by 7 members: Representatives S. Hunt, Chair; Bergquist, Vice Chair; Holy, Ranking Minority Member; Van Werven, Assistant Ranking Minority Member; Frame, Hawkins and Moscoso.
Staff: Sean Flynn (786-7124).
Background:
The Public Records Act (PRA) requires state and local agencies to make their written records available to the public for inspection and copying upon request, unless the information fits into one of the various specific exemptions in the PRA, or otherwise provided in law. The stated policy of the PRA favors disclosure and requires narrow application of the listed exemptions.
The PRA exempts certain sensitive information relating to financial, proprietary, and commercial interests provided by a business or other private interest. The exemption includes public trust or retirement investment funds supplied to the state investment board, if disclosure would result in the loss of those funds or financial loss to the person who provided the information. A similar exemption also exists for private fund investments made by the University of Washington.
A city operating a retirement system may manage the investment of retirement funds through a retirement board that manages the investments for the retirement system. Currently, Seattle, Tacoma, and Spokane operate their own retirement systems for public employees.
Summary of Bill:
Financial and commercial information relating to the investment of private funds is exempt from disclosure by a city retirement board. Such information is only exempt from disclosure to the extent that it would be expected to result in a loss to the retirement fund or a private loss to the provider of the information. The exempt information does not include the names of the private funds and the amount invested such funds or the quarterly performance results of such funds.
Appropriation: None.
Fiscal Note: Not requested.
Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is passed.
Staff Summary of Public Testimony:
(In support) The city investment boards are not part of the state pension system. Current investment portfolios include private investment funds in addition to traditional publicly traded stocks and bonds. These private funds are managed according to secret and competitive strategies. The city pension systems are subject to public records disclosure which discourages some financial managers from working for the local retirement boards to the extent that strategies of investment are exposed. Managers who withhold information about investments prevent the retirement boards from conducting due diligence.
This exemption allows city retirement boards to work with private fund managers who otherwise would not share information with the city boards out of concern about public disclosure of sensitive information. The exemption narrowly applies only to private fund investments. The names of funds and performance are available to the public. It is the same as the exemption for the state investment board and higher education investment boards.
(Opposed) None.
Persons Testifying: Representative Fey, prime sponsor; Ken Nakatsu, City of Seattle; Tim Allen, City of Tacoma; Phil Tencick, City of Spokane; and Rowland Thompson, Allied Daily Newspapers of Washington.
Persons Signed In To Testify But Not Testifying: None.