Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 1312, S.D. 1, H.D. 2, entitled:

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

The purpose of this measure is to require the Employees' Retirement System (ERS) to finalize a retiree's pension benefits within six months of the retiree's retirement or pay interest to a retiree for noncompliance with the six month deadline.

This measure specifies that beginning January 1, 2004, or the first calendar month following the month of retirement, whichever is later, interest payments calculated as simple interest shall be prorated up to the date payment is made; provided that no interest shall be paid for any pension adjustment made after the retiree's pension has been finalized. This measure also requires the ERS to impose a monthly fee upon departments or agencies that fail to timely comply with any ERS request for information. Finally, the measure authorizes the appropriation of $1 from the Employees' Retirement System's investment earnings for the purposes of this Act.

Your Committee on Conference finds that a lengthy delay exists between the date of an employee's retirement and the finalization of pension benefits. This delay results in an unnecessary burden and often a financial hardship upon retirees. However, your Committee on Conference determines that the entirety of the delay does not rest solely with the ERS, but may also be attributed to other departments or agencies. Therefore, in addition to the requirement that the ERS pay the retiree any interest associated with a failure to finalize pension benefits within six months of retirement, the ERS shall also assess a fee against any department or agency that fails to comply with the ERS's requests for information.

Furthermore, in efforts to maintain fiscal awareness and responsibility, your Committee on Conference has amended the measure to appropriate the sum of $90,000, from the Employees' Retirement System's investment earnings for the purposes of this Act; provided that the amount expended does not exceed $90,000.

As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 1312, S.D. 1, H.D. 2, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 1312, S.D. 1, H.D. 2, C.D. 1.