CONFERENCE COMMITTEE REP. NO. 30-18

Honolulu, Hawaii

, 2018

RE: S.B. No. 2767

S.D. 2

H.D. 1

C.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Honorable Scott K. Saiki

Speaker, House of Representatives

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Sirs:

Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 2767, S.D. 2, H.D. 1, entitled:

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

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

The purpose of this measure is to repeal certain provisions relating to a member's purchase of additional service credits by pre-tax contributions to ensure that the Employees' Retirement System maintains its status as a tax-qualified retirement plan under the Internal Revenue Code.

Your Committee on Conference finds that the Employees' Retirement System is intended to be a tax-qualified retirement plan under section 401(a) of the Internal Revenue Code. Your Committee on Conference also finds that Act 86, Session Laws of Hawaii 2015, prospectively changes the cost to purchase membership service after June 30, 2020. However, the Employees' Retirement System tax counsel has concluded that the change in purchase cost allows for greater pre-tax retirement contributions than had been approved by the Internal Revenue Service. Your Committee on Conference further finds that this measure makes amendments necessary to maintain the tax-qualified status of the Employees' Retirement System.

Your Committee on Conference has amended this measure by changing the effective date to upon approval.

As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 2767, S.D. 2, H.D. 1, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 2767, S.D. 2, H.D. 1, C.D. 1.

Respectfully submitted on behalf of the managers:

ON THE PART OF THE HOUSE

ON THE PART OF THE SENATE

____________________________ AARON LING JOHANSON Co-Chair	____________________________ JILL N. TOKUDA Chair
____________________________ DANIEL HOLT Co-Chair	____________________________ GILBERT S.C. KEITH-AGARAN Co-Chair