HB3082

SECTION 1. Chapter 88, Hawaii Revised Statutes, is amended by adding to part II a new section to be appropriately designated and to read as follows:

"§88- Information from the State and counties. To fulfill its responsibilities under this chapter, the system may require any department or agency of the State or counties to furnish information to the system to carry out the purposes of this chapter. The system may specify the format in which the information shall be furnished. Without limitation of the foregoing, the system may require that information be furnished in electronic format and that information with respect to payroll and personnel transactions:

(1) Allocate payments, including bonuses, salary adjustments, payments for compensatory time and workers' compensation, to monthly or other periods as requested by the system; and

(2) Specify the purpose or nature of the payment."

SECTION 2. Section 88-6, Hawaii Revised Statutes, is amended to read as follows:

"§88-6 Payment of refunds and retirement benefits. (a) Notwithstanding any other provision of this chapter:

(1) All retirees and beneficiaries of the state retirement system or county pension funds shall be paid semimonthly; and effective January 1, 2003, all retirees and beneficiaries of the state retirement system who either retire or become beneficiaries after January 1, 2003, shall be paid monthly; and

(2) Any [~~retiree~~] retirant or beneficiary whose benefit commences after June 30, 2001, shall designate a financial institution account into which the system shall be authorized to deposit their retirement benefit. This method of payment may be waived by the system if another method is determined to be more appropriate.

(b) Any member, former employee, retirant, or beneficiary to whom accumulated contributions or a hypothetical account balance, as defined in section 88-311, is payable after June 30, 2008, shall, if the payment will be greater than $250 and the member, former employee, retirant, or beneficiary does not elect to roll over the payment into an eligible retirement plan, designate a financial institution account into which the system shall be authorized to deposit the payment. This method of payment may be waived by the system if another method is determined to be more appropriate."

SECTION 3. Section 88-21, Hawaii Revised Statutes, is amended by amending the definitions of "beneficiary" and "service" to read as follows:

""Beneficiary": the recipient of any benefit from the system or, as [[]the[]] context may indicate, the person or persons designated by a member, former member, or retirant, or as provided by law to receive the benefits payable in the event of the member's, former member's, or retirant's death.

"Service": service as an employee paid by the State or county, and also: service during the period of a leave of absence or exchange if the individual is paid by the State or county during the period of the leave of absence or exchange [~~or if the individual is not paid by the State or county during the period of the leave of absence but~~]; and service during the period of an unpaid leave of absence or exchange if the individual is engaged in the performance of a governmental function or [on] if the unpaid leave of absence is an approved leave of absence for professional improvement [~~with or~~]; provided that, for the period of the leave of absence or exchange without pay [~~and~~], the individual makes the same contribution to the system as the individual would have made if the individual had not been on [~~such~~] the leave of absence. Cafeteria managers and cafeteria workers shall be considered as paid by the State, regardless of the source of funds from which they are paid."

SECTION 4. Section 88-83.5, Hawaii Revised Statutes, is amended to read as follows:

"§88-83.5 Benefit limitations. (a) Notwithstanding any

other law to the contrary, the benefits payable to all employees who first become members on or after January 1, 1990, shall be subject to the limitations set forth in section 415 of the Internal Revenue Code of 1986, as amended[.], applicable to governmental plans. The dollar limit in section 415(b)(1)(A) of the Internal Revenue Code of 1986, as amended, shall be adjusted automatically under section 415(d) of the Internal Revenue Code of 1986, as amended, effective January 1 of each year, as published in the Internal Revenue Bulletin. The automatic adjustment shall apply to members, former employees, retirants, and beneficiaries.

(b) Notwithstanding any other law to the contrary, the benefits payable to all employees who first became members before January 1, 1990, shall be subject to the greater of the following limitations as provided in section 415(b)(10) of the Internal Revenue Code of 1986, as amended:

(1) The limitations set forth in section 415 of the Internal Revenue Code of 1986, as amended; or

(2) The benefit of the member without regard to any benefit increases pursuant to an amendment adopted after October 14, 1987.

(c) The system shall establish a benefit restoration plan for the payment of retirement benefits as permitted under section 415(m) of the Internal Revenue Code of 1986, as amended, as follows:

(1) All [~~retired members~~] retirants and beneficiaries of the system whose pension has been limited by section 415 of the Internal Revenue Code shall receive a monthly benefit from the plan established pursuant to this subsection that is equal to the difference between the retirement benefit otherwise payable and the retirement benefit payable because of section 415 of the Internal Revenue Code of 1986, as amended;

(2) Participation in the plan shall be determined for each plan year and shall cease whenever the retirement benefit is not limited by section 415 of the Internal Revenue Code of 1986, as amended;

(3) The plan shall be funded on a plan-year-to-plan-year basis and shall not be used to pay any benefits payable in future years. Upon the recommendation of the system's actuary, the required contribution amount shall be determined by the board [~~of trustees~~] and deposited in a separate fund from an allocation of employer contribution amounts pursuant to this chapter;

(4) The board [~~of trustee~~] shall administer the plan and may make modifications to the benefits payable as may be necessary to maintain the qualified status of the plan under section 415(m) of the Internal Revenue Code of 1986, as amended."

SECTION 5. Section 88-141, Hawaii Revised Statutes, is amended to read as follows:

"§88-141 Computation of compensation earned or earnable. In any case where it shall become necessary, for the purposes of sections 88-131 to 88-142, to determine the compensation or average compensation of a member of the system during any period of the member's service in the armed forces, or during any period [~~(not exceeding ninety days)~~] immediately thereafter while the member was not an employee as defined in section 88-21, the member's rate of compensation during [~~any such~~] the period shall, for the purposes of sections 88-131 to 88-142, be deemed to have been that which the member [~~was receiving as such an employee immediately prior to the inception of~~] would have received but for the member's service in the armed forces [~~without any of the additional increments for length of service provided for by any classification or other law~~]."

SECTION 6. Section 88-286, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) The surviving spouse or reciprocal beneficiary and children under the age of eighteen of a member at the time of the member's death shall be eligible for a death benefit if the member suffers either [an]:

(1) An ordinary death [~~while in service or on authorized leave without pay~~] after accumulating ten years of credited service and the member dies:

(A) While in service; or [an]

(B) While on authorized leave without pay; or

(2) An accidental death."

SECTION 7. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 8. This Act shall take effect on July 1, 2008; provided that section 1 shall take effect on July 1, 2010.

INTRODUCED BY:	_____________________________
	BY REQUEST

HOUSE OF REPRESENTATIVES	H.B. NO.	3082
TWENTY-FOURTH LEGISLATURE, 2008
STATE OF HAWAII