RESOLUTION

WHEREAS, acquiring and retaining well-trained employees contribute to the efficiency of government; and

WHEREAS, both in the private and public sector, pension benefits are often a major consideration for employees both in initially accepting employment and in remaining in certain positions; and

WHEREAS, enhancing public sector pension benefits may help improve recruitment and retention of fire fighters and police officers; and

WHEREAS, the retention of fire fighters and police officers continues to be an ongoing concern for the counties and their respective fire and police departments; and

WHEREAS, in addition to being responsible for fire suppression, fire fighters are also first responders, rescue specialists, and HAZMAT specialists, and perform a plethora of other duties and assignments to protect and serve the community; and

WHEREAS, fire fighter’s and police officer’s retirement benefits are based on 2.5 per cent for each year of credited service; and

WHEREAS, fire fighters and police officers currently contribute 12.2 per cent of their wages to the Employees' Retirement System; and

WHEREAS, fire fighters, police officers, and other public safety officers are eligible to retire after 25 years of credited service with no age requirement; and

WHEREAS, a deferred retirement option plan (DROP) is an incentive for fire fighters and police officers to stay beyond the requisite 25 years of service and continue to protect the community and maintain the highest level of quality of the departments; and

WHEREAS, DROP allows a member to defer pension benefits which they are eligible for upon the requisite years of service into a separate account and that account is separate from the contributions made by an employee based on earlier years of service; and

WHEREAS, once enrolled in DROP, the employee’s retirement pension is determined based on the years of credited service at the time the employee enrolls in the DROP and additional years of service is not eligible for credit; and

WHEREAS, DROP is increasingly being utilized in many states and municipalities such as Arizona, Ohio, Florida, the City of Philadelphia, the City of Los Angeles, and Baltimore County; and

BE IT RESOLVED by the House of Representatives of the Twenty-second Legislature of the State of Hawaii, Regular Session of 2003, the Senate concurring, that the ERS, in concert with the ERS contracted actuary firm, the affected human resources agencies, public safety department representatives, the Hawaii Fire Fighters Association (HFAA) and the State of Hawaii Organization of Police Officers (SHOPO), is requested to study the feasibility of a DROP benefit for public safety employees; and

BE IT FURTHER RESOLVED that if this study determines that a DROP benefit for public safety employees is feasible, then to make recommendations for the establishment of such a program; and

BE IT FURTHER RESOLVED that the ERS, along with the affected human resources agencies, public safety departments, HFAA, and SHOPO work to develop model language to effectuate the plan; and

BE IT FURTHER RESOLVED that the study be concluded and the results and any model legislation be presented to the House Committee on Labor and Public Employment and Senate Committees on Labor and Health and Human Services no later than 20 days prior to the convening of the Regular Session of 2004; and

BE IT FURTHER RESOLVED that the Legislature review the recommendations and consult with independent parties and industry experts with regard to any modifying legislation; and

BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Administrator of the Employees' Retirement System, Mayors of the City and County of Honolulu, County of Hawaii, County of Maui, and County of Kauai, directors of the affected human resources departments, Police and Fire Chiefs of all counties, HFAA, and SHOPO.

Report Title:

Requesting the Employees' Retirement System of the State of Hawaii to study a deferred retirement option plan for firefighters and police officers and make recommendations for the establishment of such a plan.