REPORT TITLE:
ERS; Class A


DESCRIPTION:
Allows, upon application to the ERS board, a class A contributory
member to withdraw for one time only, the member's contributions
for financial hardship.  Provides that upon withdrawal, the
member will become a class C noncontributory member.  Defines
financial hardship.  Requires board to set implementing rules.
(SB2369 HD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        2369
THE SENATE                              S.B. NO.           S.D. 1
TWENTIETH LEGISLATURE, 2000                                H.D. 1
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM.



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

 1      SECTION 1.  Chapter 88, Hawaii Revised Statutes, is amended
 
 2 by adding a new section to be appropriately designated and to
 
 3 read as follows:
 
 4      "88-    Withdrawal of contributions and transfer to the
 
 5 noncontributory plan.  (a)  Notwithstanding any other provisions
 
 6 of this chapter to the contrary, a member who is in a position
 
 7 covered by Title II of the Social Security Act may apply to the
 
 8 system for a one-time withdrawal of the member's contributions in
 
 9 the event of economic hardship.
 
10      (b)  Upon approval of the member's election, all rights as a
 
11 class A member shall be extinguished and the member shall:
 
12      (1)  Become a class C member;
 
13      (2)  Be refunded the member's contributions; and
 
14      (3)  Not be required to make any further contributions.
 
15      (c)  The system shall administer this section and shall:
 
16      (1)  Prescribe the verification needed for the withdrawal
 
17           election authorized under this section;
 
18      (2)  Provide the member with information explaining the
 
19           effects of the election;
 

 
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 1      (3)  Review the facts and make a case-by-case determination;
 
 2           and
 
 3      (4)  Notify the member in writing of the approval of the
 
 4           withdrawal or the disapproval and the reasons for the
 
 5           disapproval.
 
 6      (d)  For the purposes of this section, "economic hardship"
 
 7 means a financial hardship resulting from any of the following
 
 8 conditions that cannot be satisfied by other resources,
 
 9 including:
 
10      (1)  A sudden and unexpected illness or accident of the
 
11           member or the member's dependent;
 
12      (2)  The loss of the member's property due to a casualty; or
 
13      (3)  Any other extraordinary and unforeseeable circumstance
 
14           arising as a result of events beyond the member's
 
15           control."
 
16      SECTION 2.  Section 88-271, Hawaii Revised Statutes, is
 
17 amended to read as follows:
 
18      "88-271  Election.(a)  Any class A or class B member who:
 
19      (1)  Is in service on June 30, 1984, or who returns to
 
20           service after June 30, 1984, and has vested benefit
 
21           status as provided in section 88-96(b); and
 
22      (2)  Is in a position covered by Title II of the Social
 
23           Security Act, may elect to become a class C member
 

 
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 1           effective January 1, 1985; or upon return to service,
 
 2           by filing an election form with the board.
 
 3 The election shall be made prior to December 1, 1984, or within
 
 4 thirty days of return to service and shall be irrevocable.  A
 
 5 class A or class B member who makes such an election shall be
 
 6 refunded all accumulated contributions and shall not be required
 
 7 to make further contributions upon becoming a class C member.
 
 8 The refund shall be made by March 31, 1985, or within ninety days
 
 9 after return to service.  Upon the effective date of the
 
10 election, all rights as a class A or class B member shall be
 
11 extinguished.
 
12      (b)  After June 30, 1984, a class A or class B member, who
 
13 returns to service but does not have vested benefit status as
 
14 provided in section 88-96(b), shall become a class C member upon
 
15 return to service and shall be refunded all accumulated
 
16 contributions.
 
17      [(c)  The board shall provide information explaining the
 
18 effects of the election described in subsection (a).
 
19      (d)](c)  Any water safety officer who is in service on
 
20 July 1, 1994, may elect to become a class C member by filing an
 
21 election form with the board.  The election shall be made prior
 
22 to September 1, 1994, and shall be irrevocable.  The accumulated
 
23 contributions of a water safety officer who makes this election
 

 
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 1 shall be returned to the water safety officer through payroll
 
 2 adjustments or another procedure as determined by the board.
 
 3 Upon the effective date of the election, all rights as a class A
 
 4 member shall be extinguished.  All persons first employed as a
 
 5 water safety officer after July 1, 1994, shall be class C
 
 6 members.
 
 7      (d)  Any class A member who elects and is approved to
 
 8 withdraw the member's contributions may become a class C member
 
 9 in accordance with section 88-    .  Upon approval of the
 
10 election:
 
11      (1)  All rights as a class A member shall be extinguished;
 
12      (2)  The member's accumulated contributions shall be
 
13           refunded; and 
 
14      (3)  The member shall not be required to make further
 
15           contributions to the system.  
 
16 This election shall be irrevocable.
 
17      (e)  The system shall provide information explaining the
 
18 effects of any election made under subsection (a), (c), or (d)."
 
19      SECTION 3.  Statutory material to be repealed is bracketed.
 
20 New statutory material is underscored.
 
21      SECTION 4.  This Act shall take effect upon its approval.