STAND. COM. REP. NO.2877
RE: H.B. No. 2460
Honorable Robert Bunda
President of the Senate
Twenty-First State Legislature
Regular Session of 2002
State of Hawaii
Your Committee on Labor, to which was referred H.B. No. 2460, H.D. 2, entitled:
"A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM,"
begs leave to report as follows:
The purpose of this measure is to reduce the annual contributions of public employers to the Employees' Retirement System (ERS) by amortizing liability over a period of twenty-nine years, beginning July 1, 2000.
The Department of Budget and Finance submitted testimony in support of the measure. The ERS and a private citizen opposed passage of the measure.
Your Committee finds that the tragic terrorist attacks in New York City and Washington D.C. have resulted in grim economic effects in the country and in Hawaii. On November 14, 2001, the Council on Revenues amended its previous projections by reducing the fiscal year 2001-2002 projection from 4.1 per cent to -.7 per cent and the fiscal year 2002-2003 projection from 5.2 per cent to 5.1 per cent. These reductions and out-year projections result in a general fund reduction of approximately $1,186.8 million over the planning period.
The contrary situation of reduced revenues and increased funding requirements require an in-depth review of both resources and costs. The magnitude of the State's economic downturn requires that all areas, including non-discretionary expenditures, be reviewed.
Your Committee finds that this measure will reduce the State and counties' annual payments by amortizing the liability over a longer time frame.
As affirmed by the record of votes of the members of your Committee on Labor that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2460, H.D. 2, and recommends that it pass Second Reading and be referred to the Committee on Ways and Means.
Respectfully submitted on behalf of the members of the Committee on Labor,
BOB NAKATA, Chair