STAND. COM. REP. NO. 1412-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: S.B. No. 211
                                     S.D. 1
                                     H.D. 2




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Finance, to which was referred S.B. No.
211, S.D. 1, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT
     SYSTEM,"

begs leave to report as follows:

     The purpose of this bill is to help retirees living on a
fixed income cope with the rising cost of living in Hawaii by
extending the Employees' Retirement System's pensioners' bonus
provided in Act 339, Session Laws of Hawaii 1990, from July 1,
1999, to July 1, 2001.

     Your Committee heard this measure during the Regular Session
of 1999 and recommended that it be deferred, as the substance of
this measure was found in H.B. No. 98, H.D. 1, S.D. 1.  While
H.B. No. 98, H.D. 1, S.D. 1, passed the Legislature, it was
vetoed by the Governor.

     To address the Governor's concerns expressed in Governor's
Message No. 234, your Committee has amended this measure, which
has been carried over to the Regular Session of 2000, by
increasing the amount of the special cost of living bonus
received by retirants or pensioners having five or more years of
service.

     Specifically, this measure has been amended by deleting its
substance and inserting the following provisions:

 
 
                                 STAND. COM. REP. NO. 1412-00
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     (1)  Cost of living bonuses effective July 1, 1990, and each
          July 1st until June 30, 1999, shall be a cumulative
          amount to include all previous bonuses, and shall not
          exceed:

          (A)  $1.25 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of five years by July 2nd in the year in which the
               bonus is effective;

          (B)  $2.50 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of ten years by July 2nd in the year in which the
               bonus is effective;

          (C)  $4.50 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of 15 years by July 2nd in the year in which the
               bonus is effective;

          (D)  $6.00 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of 20 years by July 1st in the year in which the
               bonus is effective;

          (E)  $8.75 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of 25 years by July 1st in the year in which the
               bonus is effective;

          (F)  $10.50 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of 30 years by July 1st in the year in which the
               bonus is effective; and

          (G)  $1.25 for each year of credited service if the
               retirant or pensioner with ten years or more of
               service who, on July 1st of the year in which the
               bonus is being calculated, has been retired a
               minimum of 20 years and whose current bonus amount
               exceeds the maximum specified;

     (2)  Cost of living bonuses effective July 1, 2000, and each
          July 1st until June 30, 2000, shall be a cumulative
          amount to include all previous bonuses, and shall not
          exceed:


 
                                 STAND. COM. REP. NO. 1412-00
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          (A)  $6.00 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of 20 years by July 1st in the year in which the
               bonus is effective;

          (B)  $8.75 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of 25 years by July 1st in the year in which the
               bonus is effective;

          (C)  $10.50 for each year of credited service if the
               retirant or pensioner has been retired a minimum
               of 30 years by July 1st in the year in which the
               bonus is effective; and

          (D)  $1.25 for each year of credited service if the
               retirant or pensioner with ten years or more of
               service who, on July 1st of the year in which the
               bonus is being calculated, has been retired a
               minimum of 20 years and whose current bonus amount
               exceeds the maximum specified;

     (3)  If the retirant or pensioner had retired, returned to
          service, and again retired, the latest retirement date
          shall be considered as the date of the retirement; and

     (4)  The bill will take effect on July 1, 2000, and be
          repealed on June 30, 2002.

     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of S.B. No.
211, S.D. 1, H.D. 1, as amended herein, and recommends that it
pass Third Reading in the form attached hereto as S.B. No. 211,
S.D. 1, H.D. 2.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Finance,



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair