REPORT TITLE:
ERS


DESCRIPTION:
Removes the early retirement penalty for state employees who
retire after twenty-five years of service but are under fifty-
five years of age.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                            61          
HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO THE RETIREMENT SYSTEM.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Section 88-74, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "88-74  Allowance on service retirement.  Upon retirement
 
 4 from service, a member shall receive a retirement allowance as
 
 5 follows:
 
 6      (1)  If the member has attained age fifty-five, a retirement
 
 7           allowance of two per cent of the member's average final
 
 8           compensation multiplied by the total number of years of
 
 9           the member's credited service as a class A and B
 
10           member, excluding any credited service as an elective
 
11           officer or legislative officer, plus a retirement
 
12           allowance of one and one-fourth per cent of the
 
13           member's average final compensation multiplied by the
 
14           total number of years of prior credited service as a
 
15           class C member; provided that:
 
16           (A)  After June 30, 1968, if the member has at least
 
17                ten years of credited service of which the last
 
18                five or more years prior to retirement is credited
 

 
Page 2                                         61          
                                     H.B. NO.           
                                                        
                                                        

 
 1                service as a firefighter, police officer, or an
 
 2                investigator of the department of the prosecuting
 
 3                attorney;
 
 4           (B)  After June 30, 1977, if the member has at least
 
 5                ten years of credited service of which the last
 
 6                five or more years prior to retirement is credited
 
 7                service as a corrections officer;
 
 8           (C)  After June 16, 1981, if the member has at least
 
 9                ten years of credited service of which the last
 
10                five or more years prior to retirement is credited
 
11                service as an investigator of the department of
 
12                the attorney general;
 
13           (D)  After June 30, 1989, if the member has at least
 
14                ten years of credited service of which the last
 
15                five or more years prior to retirement is credited
 
16                service as a narcotics enforcement investigator; 
 
17           (E)  After December 31, 1993, if the member has at
 
18                least ten years of credited service of which the
 
19                last five or more years prior to retirement is
 
20                credited service as a water safety officer; and
 
21           (F)  After June 30, 1994, if the member has at least
 
22                ten years of credited service, of which the last
 
23                five or more years prior to retirement are
 

 
Page 3                                         61          
                                     H.B. NO.           
                                                        
                                                        

 
 1                credited service as a public safety investigative
 
 2                staff investigator;
 
 3           then for each year of service as a firefighter, police
 
 4           officer, corrections officer, investigator of the
 
 5           department of the prosecuting attorney, investigator of
 
 6           the department of the attorney general, narcotics
 
 7           enforcement investigator, water safety officer, or
 
 8           public safety investigations staff investigator, the
 
 9           retirement allowance shall be two and one-half per cent
 
10           of the member's average final compensation.  The
 
11           maximum retirement allowance for those members shall
 
12           not exceed eighty per cent of the member's average
 
13           final compensation.  [If the member has not attained
 
14           age fifty-five, the member's retirement allowance shall
 
15           be computed as though the member had attained age
 
16           fifty-five, reduced in accordance with factors of
 
17           actuarial equivalence adopted by the board upon the
 
18           advice of the actuary; provided that no reduction shall
 
19           be made if the member has at least twenty-five years of
 
20           credited service as a firefighter, police officer,
 
21           corrections officer, investigator of the department of
 
22           the prosecuting attorney, investigator of the
 
23           department of the attorney general, narcotics
 

 
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                                     H.B. NO.           
                                                        
                                                        

 
 1           enforcement investigator, public safety investigations
 
 2           staff investigator, sewer worker, or water safety
 
 3           officer, of which the last five or more years prior to
 
 4           retirement is credited service in such capacities];
 
 5      (2)  If the member has made voluntary additional
 
 6           contributions for the purchase of an additional annuity
 
 7           and has not applied for a refund as permitted by
 
 8           section 88-72, the member may accept the refund at the
 
 9           time of retirement or, in lieu thereof, receive in
 
10           addition to the retirement allowance provided in
 
11           paragraph (1), an annuity that is the actuarial
 
12           equivalent of the additional contributions with regular
 
13           interest;
 
14      (3)  If the member has credited service as a judge, the
 
15           member's retirement allowance shall be computed on the
 
16           following basis:
 
17           (A)  Irrespective of age, for each year of credited
 
18                service as a judge, three and one-half per cent of
 
19                the member's average final compensation in
 
20                addition to an annuity that is the actuarial
 
21                equivalent of the member's accumulated
 
22                contributions allocable to the period of such
 
23                service; and
 

 
Page 5                                         61          
                                     H.B. NO.           
                                                        
                                                        

 
 1           (B)  For all other credited service, as provided in
 
 2                paragraphs (1), (2) and (4).  No allowance shall
 
 3                exceed seventy-five per cent of the member's
 
 4                average final compensation.  If the allowance
 
 5                exceeds this limit, it shall be adjusted by
 
 6                reducing the annuity included in subparagraph (A),
 
 7                and the portion of the accumulated contributions
 
 8                specified in that subparagraph in excess of the
 
 9                requirements of the reduced annuity shall be
 
10                returned to the member.
 
11           The allowance for judges under this paragraph, together
 
12           with the retirement allowance provided by the federal
 
13           government for similar service, shall in no case exceed
 
14           seventy-five per cent of the member's average final
 
15           compensation; or
 
16      (4)  If the member has credited service as an elective
 
17           officer or as a legislative officer, the member's
 
18           retirement allowance shall be derived by adding the
 
19           allowances computed separately under subparagraphs (A),
 
20           (B), (C), and (D) as follows:
 
21           (A)  Irrespective of age, for each year of credited
 
22                service as an elective officer, three and one-half
 
23                per cent of the member's average final
 

 
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                                     H.B. NO.           
                                                        
                                                        

 
 1                compensation as computed under section
 
 2                88-81(d)(1), in addition to an annuity that is the
 
 3                actuarial equivalent of the member's accumulated
 
 4                contributions allocable to the period of service;
 
 5                and
 
 6           (B)  Irrespective of age, for each year of credited
 
 7                service as a legislative officer, three and one-
 
 8                half per cent of the member's average final
 
 9                compensation as computed under section
 
10                88-81(d)(2), in addition to an annuity that is the
 
11                actuarial equivalent of the member's accumulated
 
12                contributions allocable to the period of service;
 
13           (C)  Irrespective of age, for each year of credited
 
14                service as a judge, three and one-half per cent of
 
15                the member's average final compensation as
 
16                computed under section 88-81(d)(3), in addition to
 
17                an annuity that is the actuarial equivalent of the
 
18                member's accumulated contributions allocable to
 
19                the period of service; and
 
20           (D)  For each year of credited service not included in
 
21                subparagraph (A), (B), or (C), the average final
 
22                compensation as computed under section 88-81(d)(4)
 
23                shall be multiplied by two per cent, two and one-
 

 
Page 7                                         61          
                                     H.B. NO.           
                                                        
                                                        

 
 1                half per cent, or one and one-quarter per cent, as
 
 2                applicable to the credited service earned as a
 
 3                class A, B, or C member, respectively.
 
 4           The total retirement allowance shall not exceed
 
 5           seventy-five per cent of the member's highest average
 
 6           final compensation calculated under section
 
 7           88-81(d)(1), (2), (3), or (4).  If the allowance
 
 8           exceeds this limit, it shall be adjusted by reducing
 
 9           any annuity accrued under subparagraphs (A), (B), and
 
10           (C) and the portion of the accumulated contributions
 
11           specified in these subparagraphs in excess of the
 
12           requirements of the reduced annuity shall be returned
 
13           to the member.  If a member has service credit as an
 
14           elective officer or as a legislative officer in
 
15           addition to service credit as a judge, then the
 
16           retirement benefit calculation contained in this
 
17           paragraph shall supersede the formula contained in
 
18           paragraph (3)."
 
19      SECTION 2.  Statutory material to be repealed is bracketed.
 
20      SECTION 3.  This Act shall take effect upon its approval.
 
21 
 
22                           INTRODUCED BY:_________________________