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Retirement & Health Benefits for March 6, 2020

March 6, 2020
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Sometimes there is no solution.
Sometimes there’s simply an end.
As the clock continues to run…
~ Sara Ella

The session is moving toward Sine Die and there’s a great deal of unknowns still to come. It’s the part of the session where bills need to be voted out of their opposite house. Some bills will make it; others will die as the clock runs down.

Each chamber has lengthy lists of other bills eligible for debate and votes. Many won’t make it. There are at least four main areas yet to be dealt with, any of which will take a great deal of floor time as bills addressing these are debated. These
are bills that seek to establish a low carbon fuel standard, a clean air rule, guidelines protecting data privacy and those that deal with the repeal of the Boeing tax break. Additionally, time can be consumed by virtue of debating proposed amendments
attached to these or any remaining bills.

Here is a summary of bills that are still ‘alive’ to date, subject to change. Remember that no bill is really ‘dead’ until Sine Die. Bills with fiscal impacts can be deemed ‘necessary to implement the budget’ (NTIB)
or just plain deemed necessary by a majority of a legislative body.

Retirement Related Proposals

Proposed bills dealing with providing a benefit increase to those members in TRS1 and PERS 1 plans can easily be seen as NTIB (Necessary to Implement the Budget) so will remain alive until Session ends.

SSB 5400 at the request of the Select Committee on Pension Policy grants TRS/PERS Plans 1 beneficiaries an increase to their monthly
benefit of three percent multiplied by the beneficiaries’ monthly benefit, not to exceed sixty-two dollars and fifty cents on the first $25,000 of benefit. Its companion bill is EHB 1390.

Both bills unanimously passed their respective houses. Both budgets also funded this cost of living adjustment. The challenge is that one of the bills has to pass out of the opposite house.

EHB 1390 has been moved to the Senate calendar where it awaits action to bring it to debate and a vote. SHB 5400 remains in House Rules.

SB 6383 | Concerning the retirement strategy funds in the plan 3 and the deferred compensation programs. Basically, retirement strategy
funds offered by the State Investment Board in the Plans 3 and DCP (Deferred Compensation Program), if the bill is passed, may include investment in the State’s Commingled Trust Fund.

This bill passed the Senate 47–0 and is now on the House calendar for debate and vote.

HB 2956 was introduced late. It proposes to take the extra dollars the state will receive once it repeals the Boeing tax preferences
the Legislature had granted them in the past to provide funding for the unfunded liabilities in the teachers’ retirement system and the public employees’ retirement system Plans 1. (Boeing has asked for this repeal to avoid receiving substantial
fines from the European Union.)

It is NTIB so will be one of many suggested uses of these ‘extra’ Boeing dollars. The Legislature is divided on how to handle Boeing’s request for this action. Some want it to return only with performance guarantees (read ‘jobs’);
others want no strings attached.

HB 2945 before House Rules is the bill repealing and then reinstating this tax preference. SB 6690, its companion is in Senate Rules.

School Employee Benefit Board (SEEB) and Other Health Related Proposals

ESSB 6189 | Directs the Joint Legislative Audit and Review Committee to study the number and types of part-time employees that are
eligible for School Employees’ Benefits Board coverage. Directs the Health Care Authority to analyze changes to the requirement that employers pay premiums when employees waive coverage. Reports are due Sept. 1, 2021. Prohibits dual enrollment
in School Employees’ Benefits Board and Public Employees’ Benefits Board plans. Previous TRIO’s have noted concerns with the bill as written.

This bill is in House Rules awaiting movement to the floor calendar.

HB 2458 | Concerning optional benefits offered by school districts.

Specifies that school district optional benefits may not compete with any basic or optional benefits offered through the School Employees’ Benefits Board. Grants school districts express authority to offer employee-paid, voluntary benefits to school
employees that are paid by employees through a payroll deduction that may fall under the SEB Board’s authority, but that are not being provided by the SEB Board. This can include personal lines homeowner’s insurance, private passenger
automobile insurance, and accident only, specified disease, and other fixed payment benefit insurance. Includes a legislative finding that supplemental fixed payment insurance plans offer financial protection and do not conflict or compete with basic
medical or disability plans.

This bill has been placed on the Senate floor calendar and is awaiting debate and a vote.

SHB 2325 the 2019–21 proposed Supplemental Budget, adopted an amendment that directs the Office of Superintendent of Public Instruction,
in consultation with the healthcare authority, to study and report on school districts’ utilization of substitute teachers and the impact of the School Employees’ Benefits Board program on substitute teacher staffing. By December 1, 2020,
and in compliance with RCW 43.01.036, the Office of Superintendent of Public Instruction must submit the report to the appropriate fiscal and policy committees of the Legislature. The report must include the following:

  1. The number of individual and full-time equivalent substitute teachers employed in the 2018–19 and 2019–20 school years by district.
  2. Substitute teachers as a percentage of classroom teachers for the 2018–19 and 2019–20 school years by district.
  3. The number of substitute teachers eligible for the school employees’ benefits board program by district.
  4. Impacts, both positive and negative, of the school employees’ benefits board program on substitute teacher staffing.
  5. Options for substitute teacher eligibility under the school employees’ benefits board program, including possible exceptions for substitute teachers.
  6. Recommendations for preserving an adequate pool of substitute teachers while consistently classifying substitute teachers for health benefits eligibility.

The bill passed the Appropriations’ Committee and has been sent to House Rules for further action.

Other Bills

ESHB 1813 mandates that the costs of contracted employee health and retirement benefits must be built into school district contracts
for pupil transportation.

The bill was amended by the Senate Ways and Means Committee. Sen. Braun proposed and Chair Rolfes agreed to adopt a ‘null and void clause’ making this bill null and void if specific funding for the provisions of the bill is not provided in
the omnibus appropriations act. Three plus scenarios could play out:

  1. The bill never comes up for debate/vote as the clock runs out,
  2. The bill passes and is then sent back to the House for concurrence, or
  3. The bill passes, and the Governor vetoes the ‘null and void’ section placing the cost solely onto districts.

This bill has been moved to the Senate floor calendar for debate and a vote.

Other Bills That May Have Fiscal/HR Impacts for Districts

SHB 2614 | Concerning paid family and medical leave.

Makes numerous revisions to the Paid Family and Medical Leave program to provide clarity and improve the program’s administration, including waiting periods, conditional waivers, and supplementation of benefits. Exempts casual labor from the types
of covered employment. Grants the Employment Security Department (ESD) statutory authority to administer oaths, take depositions, issue subpoenas, or compel a witness’ attendance in an administrative proceeding. Allows ESD to apply for and obtain
a superior court order authorizing a subpoena in advance of its issuance. Authorizes employees to bring a private right of action to recover damages for an employer’s unlawful acts, under specified conditions. This bill is agency request legislation.
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