STAND

STAND. COM. REP. NO. 76

Honolulu, Hawaii

, 2005

RE: H.B. No. 631

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Labor & Public Employment, to which was referred H.B. No. 631 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 clarify and correct the language of various Employees' Retirement System (ERS) statutes and conform ERS statutes to current practices. Among other things, this bill:

(1) Requires the ERS to comply with federal income tax limits on compensation in determining ordinary death benefits;

(2) Specifies which appointed county positions qualify for contributory plan membership;

(3) Allows death benefits to be paid consistent with the employee's actual eligibility for those benefits;

(4) Allows the ERS to calculate a retiree's pension based on the benefit formula at the time of retirement rather than at the time of separation from service;

(5) Requires the counties to remit employer contributions to the ERS on a monthly basis rather than semiannually;

(6) Specifies that the cost to convert noncontributory plan service to hybrid plan service will be based on the member's age in full years and the member's basic rate of pay as of June 30, 2006; and

(7) Eliminates the deadline for claiming and purchasing hybrid plan membership service credit and allows the acquisition of qualifying service credit at any time prior to retirement to be consistent with current contributory plan procedures.

The Board of Trustees of the ERS and the Hawaii State Teachers Association testified in support of this measure.

Your Committee finds that this is a housekeeping measure that will enable the ERS to change certain administrative practices and clarifies or corrects statutory language to conform with the efficient and compliant performance of the responsibilities of the ERS Board of Trustees.

As affirmed by the record of votes of the members of your Committee on Labor & Public Employment that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 631 and recommends that it pass Second Reading and be referred to the Committee on Higher Education.

Respectfully submitted on behalf of the members of the Committee on Labor & Public Employment,

		____________________________ KIRK CALDWELL, Chair