Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Finance, to which was referred S.B. No. 2073, S.D. 2, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this bill is to enable the University of Hawaii (UH) to implement an optional retirement system (ORS) for its employees by:

The UH Professional Assembly, Teachers Insurance and Annuity Association College Retirement Equities Fund, and AIG VALIC testified in support of this bill. The Hawaii Government Employees Association and UH supported the intent of this measure and recommended amendments. The Department of Budget and Finance and Employees' Retirement System (ERS) commented on this bill.

Your Committee has amended this measure by:

Concerns were raised by ERS regarding the clarity of language tying the State's contribution to the ORS to the contribution the State makes on behalf of the Governor to the ERS. Your Committee notes that ERS commented that the specific language that contributions made by the State on behalf of employees to the ORS would be capped at six percent of the Governor's annual salary would clear up any ambiguity in contribution rates.

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. 2073, S.D. 2, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2073, S.D. 2, H.D. 2.