STAND. COM. REP. NO. 2451

Honolulu, Hawaii

RE:    S.B. No. 2841

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2016

State of Hawaii

Sir:

     Your Committee on Judiciary and Labor, to which was referred S.B. No. 2841 entitled:

"A BILL FOR AN ACT RELATING TO PAYMENTS BY EMPLOYERS TO THE EMPLOYEES' RETIREMENT SYSTEM,"

begs leave to report as follows:

     The purpose and intent of this measure is to require the State and counties to make their required contributions to the Employees' Retirement System (ERS) on a monthly basis or in advance in an amount greater than the amount payable for the current fiscal quarter.

     Your Committee received testimony in support of this measure from the Employees' Retirement System.

     Your Committee finds that under existing law, employer contributions to the ERS are required to be made on a monthly basis.  While advance payment is not prohibited, existing law may be interpreted to require an employer who makes an advance contribution to the ERS to also make monthly payments even if the advance payment covered the required monthly payment amount.  Implementation of this measure provides clarity regarding state and county contributions to the ERS and provides the ERS with the opportunity to invest funds sooner for greater investment returns by removing any disincentives to employers for making advance payments.

     As affirmed by the record of votes of the members of your Committee on Judiciary and Labor that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2841 and recommends that it pass Second Reading and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Judiciary and Labor,

________________________________

GILBERT S.C. KEITH-AGARAN, Chair