STAND. COM. REP. NO. 3205

Honolulu, Hawaii

RE: H.B. No. 2341

H.D. 1

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Sir:

Your Committees on Labor and Judiciary, to which was referred H.B. No. 2341, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO QUALIFIED DOMESTIC RELATIONS ORDERS,"

beg leave to report as follows:

The purpose and intent of this measure is to:

(1) Allow the Employees' Retirement System (ERS) to make direct payments to spouses or former spouses of ERS members or retirants to include former spouses or former members with vested benefit status when the former spouse has been awarded all or a portion of ERS retirement benefits as ordered or decreed in a domestic relations proceeding;

(2) Make ERS benefits payable to an alternate payee; and

(3) Delay implementation of Act 263, Session Laws of Hawaii 2016, to July 1, 2020.

Your Committees received testimony in support of this measure from the Board of Trustees of the Employees' Retirement System and O‘ahu County Committee on Legislative Priorities of the Democratic Party of Hawai‘i. Your Committees received testimony in opposition to this measure from one individual.

Your Committees find that Act 263, Session Laws of Hawaii 2016 (Act 263), authorizes and requires the ERS to make direct payments to the spouse or former spouse of an ERS member or retirant when the spouse or former spouse has been awarded all or a portion of the member's or retirant's retirement benefits as part of a property division adjudicated, ordered, or decreed by a court in a domestic relations proceeding. Act 263 did not make any appropriations for its implementation; therefore, this measure authorizes necessary funding. In addition, this measure amends the scope and implementation date of Act 263 by making consistent the benefit period payable to alternate payees regardless of whether the domestic relations order is certified prior to or after the member, former member with vested benefit status, or retirant retires, and by delaying the implementation of Act 263 until July 1, 2020. Your Committees find that delay of the effective date is necessary for development and application of necessary resources to support implementation and fund the costs of computer system modifications, ERS member and other affected parties' education, and increased operational costs.

Your Committees have amended this measure by making technical, nonsubstantive amendments for the purposes of clarity and consistency.

Your Committees request that as this measure moves forward, your Committee on Ways and Means and the ERS work together to address the issue of designating the proper expending agency for the appropriation made in this measure.

As affirmed by the records of votes of the members of your Committees on Labor and Judiciary that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2341, H.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2341, H.D. 1, S.D. 1, and be referred to your Committee on Ways and Means.

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

________________________________ BRIAN T. TANIGUCHI, Chair

________________________________ JILL N. TOKUDA, Chair