The Washington State Deferred Compensation Program (DCP) is a supplemental savings program under Section 457 of the federal Internal Revenue Code offered to state employees and to the employees of local governments that elect to participate in DCP. Both tax-deferred and post-tax supplemental savings programs are offered. It is administered by the Department of Retirement Systems (DRS) which contracts with a vendor for recordkeeping and other administrative services.
Since 2017, new state employees are automatically enrolled in DCP with a 3 percent employee contribution unless they choose not to participate or opt out. Local governments may choose to offer the DRS-administered DCP or other non-governmental DCPs to its employees.
The Volunteer Firefighters' Relief and Pension System (VFFRPS) provides death, disability, medical, and retirement benefits to volunteer firefighters, reserve officers, and emergency medical workers in cities, towns, and fire protection districts. The VFFRPS is funded by member and employer contributions and 40 percent of the fire insurance premium tax. Volunteers with local government entities are not eligible to participate in the VFFRPS or in DCP, even if their local government employer has elected to participate in DCP. Volunteer firefighters may receive stipends, reimbursements, or other nominal payments from fire departments that are not intended to be wages or compensation for service.
Volunteer firefighters whose agency participates in DCP may enroll in DCP.
PRO: This bill helps address the ongoing challenge of recruiting and retaining volunteer firefighters by offering them access to the state’s deferred compensation program. Currently, volunteer firefighters receive only a small pension, and a recent audit determined they are not eligible to participate in the program, despite past efforts to include them. This bill would legitimize their participation, providing an additional benefit at no cost to the state, since contributions come from the volunteers or their fire districts. Passing this bill would show appreciation for their service and help strengthen the volunteer fire force across Washington.