Report Title:

UH; Retirement

Description:

Establishes a University of Hawaii retirement system, to be administered by the board of regents, for permanent employees of UH or the community college system who are excluded from bargaining unit 7 pursuant to chapter 89.

HOUSE OF REPRESENTATIVES

H.B. NO.

322

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO THE UNIVERSITY OF HAWAII.

 

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

SECTION 1. The legislature finds that, with the exception of the president of the University of Hawaii (UH), the salaries of all department heads and executive officers of the state are within parameters set by the legislature. Pursuant to section 26-52, Hawaii Revised Statutes, the board of regents determines the salary of the UH president. This special exception exists because of the legislature's recognition of the need for UH autonomy.

As part of granting UH autonomy, UH is provided greater flexibility in recruiting and hiring the best candidates for faculty and administrative positions. It is not unusual for an individual to earn more than $100,000 per year at UH. In comparison, the governor, the top executive officer in state government, earns $98,780 per year. The UH president earns almost five times more at $442,000 per year.

Since neither the legislature nor the employees' retirement system (ERS) are involved in negotiating the UH president's salary and benefits package, it is impossible to determine the fiscal impact of higher salaries on the State's retirement system. The legislature is concerned that significantly higher pay scales at UH will negatively impact the employees' retirement system.

The purpose of this Act is to establish a separate retirement system exclusively for permanent employees of UH or the community college system who are excluded from bargaining unit 7 pursuant to chapter 89.

SECTION 2. Chapter 304, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§304- University of Hawaii retirement system. (a) The board of regents shall establish a retirement system separate from the state employees' retirement system to provide retirement allowances and other benefits for permanent employees of the University of Hawaii or the community college system who are excluded from bargaining unit (7) pursuant to chapter 89.

(b) The general administration and the responsibility for the proper operation of the University of Hawaii retirement system shall be vested in the board of regents. The board of regents may manage the retirement system within the University of Hawaii or contract for the management of the retirement system.

(c) The board of regents may establish vesting periods for the members of the retirement system of the University of Hawaii that are different from those established in chapter 88.

(d) The board of regents may establish retirement allowances and other benefits for the retirement system of the University of Hawaii.

(e) The employer's share of the cost of the retirement plan of the retirement system of the University of Hawaii shall not exceed the equivalent amount for any other group covered by chapter 88."

SECTION 3. Section 88-8, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (a) to read:

"(a) Notwithstanding any other law to the contrary, the board of regents may establish without regard to the public notice or public hearing requirements of chapter 91, a retirement system separate from the state employees' retirement system to provide retirement allowances and other benefits for University of Hawaii employees who are[:

(1) Members] members of bargaining unit (7)[; or

(2) Other employees of the University of Hawaii or the community college system who are excluded from bargaining unit (7) pursuant to chapter 89]."

2. By amending subsections (f) and (g) to read:

"(f) Any member of the state employees' retirement system when the optional retirement system of the University of Hawaii is established who is also[:

(1) A] a member of bargaining unit (7)[; or

(2) Other employees of the University of Hawaii or the community college system who are excluded from bargaining unit (7) pursuant to chapter 89,]

shall remain a member of the state employees' retirement system unless the person elects in writing on a form prescribed by the board of regents to terminate the person's membership. The form shall be submitted to the state employees' retirement system no later than ninety days after the establishment of the optional retirement system of the University of Hawaii.

(g) Any person hired after the establishment of the optional retirement system of the University of Hawaii who is[:

(1) A] a member of bargaining unit (7)[; or

(2) Other employees of the University of Hawaii or the community college system who are excluded from bargaining unit (7) pursuant to chapter 89,]

shall elect to be a member of the state employees' retirement system or the optional retirement system of the University of Hawaii. Upon an election the person may not transfer from one system to the other."

SECTION 4. Section 88-21, Hawaii Revised Statutes, is amended by amending the definition of "employee" to read as follows:

""Employee": any employee or officer of the State or any county, including inspectors, principals, teachers and special teachers, regularly employed in the public schools, cafeteria managers and cafeteria workers, apprentices and on-the-job trainees whether or not supported in whole or in part by any federal grants, members of the legislature and other elective officers, including the trustees of the office of Hawaiian affairs, legislative employees who are employed on a full-time basis during and between sessions, probationary and provisional employees, any employee of the educational nonprofit public corporation as provided in section 88-49.7, per diem employees and others who are made eligible by reason of their employment to membership in the system by or pursuant to any other provision of law, but excluding:

(1) Per diem employees who elect to withdraw or not to become members as provided in section 88-42;

(2) Members of the legislature who do not elect to be members as provided in section 88-42;

(3) Persons excluded by rules of the board pursuant to section 88-43[.]; and

(4) Permanent employees of the University of Hawaii or the community college system who are excluded from bargaining unit 7 pursuant to chapter 89.

An individual is an employee during the period of a leave of absence if the individual is in service, as defined in this part, during the period of the leave of absence and the board shall determine who are employees within the meaning of this part."

SECTION 5. The employees' retirement system shall cooperate with the board of regents in the transfer of responsibility of retirement allowances and benefits provided by this Act. The board of regents shall report on the status of the transfer to the legislature no later than twenty days before the convening of the regular session of 2004.

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect on July 1, 2004.

INTRODUCED BY:

_____________________________