SB 5652 — Concerning law enforcement officers' and firefighters' retirement system benefits.

S-3925.2Z-0496.1 SUBSTITUTE SENATE BILL 5652 State of Washington 67th Legislature 2022 Regular Session By Senate Ways & Means (originally sponsored by Senators Conway, Rivers, Lovick, Mullet, Muzzall, Nobles, Short, Van De Wege, Wagoner, and C.

by request of LEOFF Plan 2 Retirement Board)Board READPrefiled FIRST01/05/22. TIME 01/28/22.

Read first time 01/10/22.

Referred to Committee on Ways & Means.

1 SSBSB 5652 (c) Two percent of such member's final average salary for years of service above 25 years.

2 SSBSB 5652 $100 per service credit month or a lump sum defined benefit of $20,000.

3 SSBSB 5652 with an eligible rollover, direct rollover, or trustee-to-trustee transfer from an eligible retirement plan.

4 SSBSB 5652 when applicable, shall be collected in addition to any contribution rate required to amortize past gain-sharing distributions in plan 3.

On June 30th of each even-numbered year, if the funded status of the law enforcement officers' and firefighters' retirement system plan 2 as measured by the most recent completed actuarial valuation performed by the office of the state actuary is:

or (b) Greater than or equal to 105 percent and less than 110 percent, then the minimum contribution rate for the employer and state normal cost shall equal the total contribution rate required to fund 90 percent of the plan 2 employer normal cost as calculated under the entry age normal cost method;method.

or (c) Greater than or equal to 110 percent, then the minimum contribution rate for the employer and state normal cost shall equal the total contribution rate required to fund 80 percent of the plan 2 employer normal cost as calculated under the entry age normal cost method.

((Any))Any Thechanges minimumadopted contributionby p.the council shall be subject to revision by the legislature.

5 SSB 5652 rates in this section, including changes adopted by the council, shall be subject to revision by the legislature.

MINIMUMp. CONTRIBUTION RATES.

5 SB 5652 MINIMUM CONTRIBUTION RATES.

On June 30th of each even-numbered year, if the funded status of the law enforcement officers' and firefighters' retirement system plan 2 as measured by the most recent completed actuarial valuation performed by the office of the state actuary is:

(a) Less than 105 percent, then the minimum contribution rate for the member normal cost shall equal the total contribution rate p.required to fund 100 percent of the plan 2 member normal cost as calculated under the entry age normal cost method;

6or SSB(b) 5652Greater than or equal to 105 percent, then the minimum contribution rate for the member normal cost shall equal the total contribution rate required to fund 10090 percent of the plan 2 member normal cost as calculated under the entry age normal cost method;method.

(b)p. Greater than or equal to 105 percent and less than 110 percent, then the minimum contribution rate for the member normal cost shall equal the total contribution rate required to fund 90 percent of the plan 2 member normal cost as calculated under the entry age normal cost method;

or6 (c)SB Greater5652 than(5) orUpon equalcompletion toof 110each percent,biennial thenactuarial thevaluation, minimum contribution rate for the employer and state normalactuary cost shall equalreview the totalappropriateness of these minimum contribution raterates requiredand recommend to fundthe 80legislature percentany ofadjustments theas planmay 2be employerneeded normaldue costto asmaterial calculatedchanges underin thebenefits entryor ageactuarial normalassumptions, costmethods, method.or experience.

(5) Upon completion of each biennial actuarial valuation, the state actuary shall review the appropriateness of these minimum contribution rates and recommend to the legislature any adjustments as may be needed due to material changes in benefits or actuarial assumptions, methods, or experience.

(b) For 2021-2023 and 2023-2025 fiscal biennia, contribution rates for the law enforcement officers' and firefighters' retirement system plan 2 may not exceed the rates adopted by the law enforcement officers' and firefighters' plan 2 retirement board in 2020.2021.

p.TRANSFER OF FUNDS.

7 SSB 5652 TRANSFER OF FUNDS.

(3) By JulyJune 31,30, 2022, the Washington state investment board shall transfer the difference between the value of the benefit enhancements inp. this act as identified by the office of the state actuary and the value of the local law enforcement officers' and firefighters' retirement system benefits improvement account, from the law enforcement officers' and firefighters' system plan 2 retirement fund to the local law enforcement officers' and firefighters' retirement system benefits improvement account.

(4)7 BySB August5652 31,in 2022,this theact Washingtonas stateidentified investmentby boardthe shalloffice transferof the totalstate availableactuary balanceand the value of the local law enforcement officers' and firefighters' retirement system benefits improvement accountaccount, tofrom the law enforcement officers' and firefighters' system plan 2 retirement fund.fund to the local law enforcement officers' and firefighters' retirement system benefits improvement account.

(4) By July 31, 2022, the Washington state investment board shall transfer the total available balance of the local law enforcement officers' and firefighters' retirement system benefits improvement account to the law enforcement officers' and firefighters' system plan 2 retirement fund.

To accomplish this goal, after the transfer of funds in section 7 of this act the office of the state actuary must calculate a rate reduction to be applied to rates calculated in sections 4(5)4 (a) and (b)5 and 5(4) (a) and (b) of this act.

This rate must be calculated in time for it to go into effect on JulyJune 1, 2025, p.using any data, assumptions, and methods the state actuary believes are reasonable for this purpose.

8 SSB 5652 using any data, assumptions, and methods the office of the state actuary believes are reasonable for this purpose.

98 SSBSB 5652