REPORT TITLE:
ERS


DESCRIPTION:
Gives current deputy sheriffs of the Department of Public Safety
the option of converting from class C to class A members of the
Employees' Retirement System (ERS).  Allows deputy sheriffs to
retire without penalty after 25 years of service in that
capacity.  Provides that all deputy sheriffs hired after June 30,
1999, are to be designated class A members. (HB1416 CD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        1416
HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 2
TWENTIETH LEGISLATURE, 1999                                S.D. 2
STATE OF HAWAII                                            C.D. 1
                                                        
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM.



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

 1      SECTION 1.  Section 88-21, Hawaii Revised Statutes, is
 
 2 amended by adding one new definition to be appropriately inserted
 
 3 and to read as follows:
 
 4      ""Deputy sheriff":  any regularly employed member of the
 
 5 department of public safety whose principal duty is to perform
 
 6 the duties specified in section 26-14.6(f)."
 
 7      SECTION 2.  Section 88-45, Hawaii Revised Statutes, is
 
 8 amended to read as follows:
 
 9      "�88-45  Employee contributions.  (a)  After June 30, 1988,
 
10 each class A and class B member shall contribute seven and eight-
 
11 tenths per cent of the member's compensation to the annuity
 
12 savings fund[; provided that after] for service in that capacity.
 
13      (b)  After June 30, 1989, all firefighters, police officers,
 
14 corrections officers, investigators of the departments of the
 
15 prosecuting attorney and of the attorney general, narcotics
 
16 enforcement investigators, water safety officers not making the
 
17 election under section 88-271, and public safety investigations
 
18 staff investigators shall contribute twelve and two-tenths per
 
19 cent of their compensation to the annuity savings fund for
 
20 service in that capacity.
 

 
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                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1      (c)  After June 30, 1999, all deputy sheriffs, unless the
 
 2 deputy sheriff has opted not to become a class A member pursuant
 
 3 to Act    , Session Laws of Hawaii 1999, shall contribute twelve
 
 4 and two-tenths per cent of their compensation to the annuity
 
 5 savings fund for service in that capacity." 
 
 6      SECTION 3.  Section 88-47, Hawaii Revised Statutes, is
 
 7 amended by amending subsection (a) to read as follows:
 
 8      "(a)  There shall be three classes of members in the system
 
 9 to be known as class A, class B, and class C, defined as follows:
 
10      (1)  Class A shall consist of members covered by section
 
11           88-74(3), those members whose salaries are set forth in
 
12           sections 26-52 and 26-53, and their county
 
13           counterparts, managing directors or administrative
 
14           assistant to the mayor, and other department heads,
 
15           including agency heads appointed by the mayor, first
 
16           deputies appointed by the county attorney and
 
17           prosecuting attorney, the county clerk and deputy
 
18           county clerk of each county, the administrative
 
19           director of the courts, the deputy administrative
 
20           director of the courts, the executive [director]
 
21           officer of the labor and industrial relations appeals
 
22           board, the executive [director] officer of the Hawaii
 
23           labor relations board, investigators of the department
 

 
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                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           of the attorney general, narcotics enforcement
 
 2           investigators, water safety officers not making the
 
 3           election under section 88-271, public safety
 
 4           investigations staff investigators, deputy sheriffs,
 
 5           and those members in service prior to July 1, 1984,
 
 6           including those who are on approved leave of absence,
 
 7           who are covered by Title II of the Social Security Act
 
 8           on account of service creditable under this part.  This
 
 9           class shall consist of:
 
10           (A)  All employees who enter membership after June 30,
 
11                1957, except employees in positions to which
 
12                coverage under Title II of the Social Security Act
 
13                is not extended;
 
14           (B)  All employees who were members on July 1, 1957,
 
15                who elected to be covered by the Social Security
 
16                Act; and
 
17           (C)  All former class A retirants who return to
 
18                employment after June 30, 1984, requiring the
 
19                retirant's active membership;
 
20      (2)  Class B shall consist of all members who are not class
 
21           A or class C members; and
 
22      (3)  Except for members described in [section 88-47(a)(1),]
 
23           subsection (a)(1), class C shall consist of all
 

 
Page 4                                                     1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           employees in positions covered by Title II of the
 
 2           Social Security Act who:
 
 3           (A)  First enter service after June 30, 1984;
 
 4           (B)  Reenter service after June 30, 1984, without
 
 5                vested benefit status as provided in section
 
 6                88-96(b);
 
 7           (C)  Make the election to become a class C member as
 
 8                provided in part VII; [or]
 
 9           (D)  Are former class C retirants who return to service
 
10                requiring the retirant's active membership[.]; or
 
11           (E)  Any deputy sheriff who elected not to become a
 
12                class A member pursuant to Act    , Session Laws
 
13                of Hawaii 1999."
 
14      SECTION 4.  Section 88-74, Hawaii Revised Statutes, is
 
15 amended to read as follows:
 
16      "�88-74  Allowance on service retirement.  Upon retirement
 
17 from service, a member shall receive a retirement allowance as
 
18 follows:
 
19      (1)  If the member has attained age fifty-five, a retirement
 
20           allowance of two per cent of the member's average final
 
21           compensation multiplied by the total number of years of
 
22           the member's credited service as a class A [and] or
 
23           class B member, excluding any credited service as an
 

 
Page 5                                                     1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           elective officer or legislative officer, plus a
 
 2           retirement allowance of one and one-fourth per cent of
 
 3           the member's average final compensation multiplied by
 
 4           the total number of years of prior credited service as
 
 5           a class C member; provided that:
 
 6           (A)  After June 30, 1968, if the member has at least
 
 7                ten years of credited service of which the last
 
 8                five or more years prior to retirement is credited
 
 9                service as a firefighter, police officer, or an
 
10                investigator of the department of the prosecuting
 
11                attorney;
 
12           (B)  After June 30, 1977, if the member has at least
 
13                ten years of credited service of which the last
 
14                five or more years prior to retirement is credited
 
15                service as a corrections officer;
 
16           (C)  After June 16, 1981, if the member has at least
 
17                ten years of credited service of which the last
 
18                five or more years prior to retirement is credited
 
19                service as an investigator of the department of
 
20                the attorney general;
 
21           (D)  After June 30, 1989, if the member has at least
 
22                ten years of credited service of which the last
 
23                five or more years prior to retirement is credited
 
24                service as a narcotics enforcement investigator; 
 

 
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                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           (E)  After December 31, 1993, if the member has at
 
 2                least ten years of credited service of which the
 
 3                last five or more years prior to retirement is
 
 4                credited service as a water safety officer; [and]
 
 5           (F)  After June 30, 1994, if the member has at least
 
 6                ten years of credited service[,] of which the last
 
 7                five or more years prior to retirement [are] is
 
 8                credited service as a public safety
 
 9                [investigative] investigations staff investigator;
 
10                and
 
11           (G)  After June 30, 1999, if the member has at least
 
12                ten years of credited service of which the last
 
13                five or more years prior to retirement is credited
 
14                service as a deputy sheriff;
 
15           then for each year of service as a firefighter, police
 
16           officer, corrections officer, investigator of the
 
17           department of the prosecuting attorney, investigator of
 
18           the department of the attorney general, narcotics
 
19           enforcement investigator, water safety officer, deputy
 
20           sheriff, or public safety investigations staff
 
21           investigator, the retirement allowance shall be two and
 
22           one-half per cent of the member's average final
 
23           compensation.  The maximum retirement allowance for
 

 
Page 7                                                     1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           those members shall not exceed eighty per cent of the
 
 2           member's average final compensation.  If the member has
 
 3           not attained age fifty-five, the member's retirement
 
 4           allowance shall be computed as though the member had
 
 5           attained age fifty-five, reduced in accordance with
 
 6           factors of actuarial equivalence adopted by the board
 
 7           upon the advice of the actuary; provided that no
 
 8           reduction shall be made if the member has at least
 
 9           twenty-five years of credited service as a firefighter,
 
10           police officer, corrections officer, investigator of
 
11           the department of the prosecuting attorney,
 
12           investigator of the department of the attorney general,
 
13           narcotics enforcement investigator, public safety
 
14           investigations staff investigator, sewer worker, deputy
 
15           sheriff, or water safety officer, of which the last
 
16           five or more years prior to retirement is credited
 
17           service in such capacities;
 
18      (2)  If the member has made voluntary additional
 
19           contributions for the purchase of an additional annuity
 
20           and has not applied for a refund as permitted by
 
21           section 88-72, the member may accept the refund at the
 
22           time of retirement or, in lieu thereof, receive in
 
23           addition to the retirement allowance provided in
 

 
Page 8                                                     1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           paragraph (1), an annuity that is the actuarial
 
 2           equivalent of the additional contributions with regular
 
 3           interest;
 
 4      (3)  If the member has credited service as a judge, the
 
 5           member's retirement allowance shall be computed on the
 
 6           following basis:
 
 7           (A)  Irrespective of age, for each year of credited
 
 8                service as a judge, three and one-half per cent of
 
 9                the member's average final compensation in
 
10                addition to an annuity that is the actuarial
 
11                equivalent of the member's accumulated
 
12                contributions allocable to the period of such
 
13                service; and
 
14           (B)  For all other credited service, as provided in
 
15                paragraphs (1), (2), and (4).  No allowance shall
 
16                exceed seventy-five per cent of the member's
 
17                average final compensation.  If the allowance
 
18                exceeds this limit, it shall be adjusted by
 
19                reducing the annuity included in subparagraph (A),
 
20                and the portion of the accumulated contributions
 
21                specified in that subparagraph in excess of the
 
22                requirements of the reduced annuity shall be
 
23                returned to the member.
 

 
Page 9                                                     1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           The allowance for judges under this paragraph, together
 
 2           with the retirement allowance provided by the federal
 
 3           government for similar service, shall in no case exceed
 
 4           seventy-five per cent of the member's average final
 
 5           compensation; or
 
 6      (4)  If the member has credited service as an elective
 
 7           officer or as a legislative officer, the member's
 
 8           retirement allowance shall be derived by adding the
 
 9           allowances computed separately under subparagraphs (A),
 
10           (B), (C), and (D) as follows:
 
11           (A)  Irrespective of age, for each year of credited
 
12                service as an elective officer, three and one-half
 
13                per cent of the member's average final
 
14                compensation as computed under section
 
15                88-81(d)(1), in addition to an annuity that is the
 
16                actuarial equivalent of the member's accumulated
 
17                contributions allocable to the period of service;
 
18                [and]
 
19           (B)  Irrespective of age, for each year of credited
 
20                service as a legislative officer, three and one-
 
21                half per cent of the member's average final
 
22                compensation as computed under section
 
23                88-81(d)(2), in addition to an annuity that is the
 

 
Page 10                                                    1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1                actuarial equivalent of the member's accumulated
 
 2                contributions allocable to the period of service;
 
 3           (C)  Irrespective of age, for each year of credited
 
 4                service as a judge, three and one-half per cent of
 
 5                the member's average final compensation as
 
 6                computed under section 88-81(d)(3), in addition to
 
 7                an annuity that is the actuarial equivalent of the
 
 8                member's accumulated contributions allocable to
 
 9                the period of service; and
 
10           (D)  For each year of credited service not included in
 
11                subparagraph (A), (B), or (C), the average final
 
12                compensation as computed under section 88-81(d)(4)
 
13                shall be multiplied by two per cent, two and one-
 
14                half per cent, or one and one-quarter per cent, as
 
15                applicable to the credited service earned as a
 
16                class A, B, or C member, respectively.
 
17           The total retirement allowance shall not exceed
 
18           seventy-five per cent of the member's highest average
 
19           final compensation calculated under section
 
20           88-81(d)(1), (2), (3), or (4).  If the allowance
 
21           exceeds this limit, it shall be adjusted by reducing
 
22           any annuity accrued under subparagraphs (A), (B), and
 
23           (C) and the portion of the accumulated contributions
 

 
Page 11                                                    1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1           specified in these subparagraphs in excess of the
 
 2           requirements of the reduced annuity shall be returned
 
 3           to the member.  If a member has service credit as an
 
 4           elective officer or as a legislative officer in
 
 5           addition to service credit as a judge, then the
 
 6           retirement benefit calculation contained in this
 
 7           paragraph shall supersede the formula contained in
 
 8           paragraph (3)."
 
 9      SECTION 5.  Section 88-281, Hawaii Revised Statutes, is
 
10 amended by amending subsection (b) to read as follows:
 
11      "(b)  If a member has at least twenty-five years of credited
 
12 service as a sewer worker [or as a], water safety officer, or
 
13 deputy sheriff, of which the last five or more years prior to
 
14 retirement is credited in such a capacity, then the sewer worker
 
15 [or], water safety officer, or deputy sheriff, shall be eligible
 
16 to receive a normal retirement benefit unreduced for age."
 
17      SECTION 6.  (a)  Notwithstanding any other law to the
 
18 contrary, deputy sheriffs of the department of public safety who
 
19 are in service prior to the effective date of this Act may
 
20 convert to class A membership; provided that their membership
 
21 service before July 1, 1999, shall remain at class C level.  An
 
22 election form indicating the option selected shall be filed with
 
23 the board of trustees prior to December 1, 1999.  The election
 
24 filed with the board of trustees shall be irrevocable.
 

 
Page 12                                                    1416
                                     H.B. NO.           H.D. 2
                                                        S.D. 2
                                                        C.D. 1
                                                        

 1      (b)  All deputy sheriffs of the department of public safety
 
 2 hired after June 30, 1999, shall be designated class A members of
 
 3 the employees' retirement system.
 
 4      SECTION 7.  Statutory material to be repealed is bracketed.
 
 5 New statutory material is underscored.
 
 6      SECTION 8.  This Act shall take effect on July 1, 1999.