Retirement & Health Benefits for January 31, 2020

“Show me the money!” ~ Jerry Maguire

The big push has begun as bills will be moving out of their house of origin in order to clear the policy and fiscal deadlines and move toward adoption by the chambers.

Some bills have yet, if ever, to be scheduled, and are not reported here yet, they may not be dead. Remember that bills dealing with dollars, (think COLA or SEBB), will stay ‘alive’ until SINE DIE as they fall into the ‘necessary to implement the budget’ category. These have been mentioned in previous reports.

Meanwhile, the need for communication with legislators to help them prioritize is critical.

Below is a summary of bills that have had some degree of action to date.

Retirement Related Proposals

Proposed bills dealing with providing a benefit increase to those members in TRA 1 and PERS 1 plans although introduced will not see any action until the budget talks begin.

Since the next revenue forecast is due Feb. 19th, further action on these requests consists of working with legislators behind the scenes to remind them of the need. Bills in play include: SB 6165, HB 1390, and SB 5400.

SB 6662 was introduced on 1/31/20. Providing retirement benefits at earlier ages in the plans 2 and 3 of the public employees’ retirement system, the teachers’ retirement system, and the school employees’ retirement system. Briefly stated, any member who is at least age fifty-five and has completed at least five service credit years and for whom the sum of the number of years of the member’s age and the number of years of the member’s service credit equals eighty-five or more shall be eligible to retire and receive an unreduced retirement allowance. This bill has been referred to the Senate Ways and Means Committee.

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

The SEBB Board held a meeting on 1/27/2020. See the summary at the end of this post.

HB 2458/ SB 6479 | Concerning optional benefits offered by school districts.

These bills allow for districts to continue offering some benefits that are not in competition with those offered by SEBB. If SEBB is not providing the benefit, then a jurisdiction should be able to provide it. It was pointed out that these benefits are employee paid. Examples would include VEBA, cancer insurance, auto insurance, etc.

These bills are scheduled for Executive Action on 2/4 (House Education) and 2/5 (Senate Ways and Means).

Other Bills

Previously, SB 6176 incorporating the costs of employee health and retirement benefits into school district contracts for pupil transportation was covered. It had a public hearing on 1/24 where WASA and schools testified as to the unfunded costs associated with it. In addition, the bill is problematic for a number of reasons. Once this door is open, what about contracted food service workers, special education contractor, etc.?

Subsequent to the hearing, the House brought ESHB 1813, a similar bill out of Rules Committee where it ended last Session and brought it directly to the floor. The House passed this bill 1/30 with a 60–36 vote. Wham! No need for committee hearings, just quick action. It will not move to the Senate for their action.

Other Bills That May Have Fiscal/HR Impacts for Districts

HB 2171 | Concerning vested vacation or paid time off upon an employee’s termination. If an employer has an established policy, practice, or agreement to provide paid vacation or paid time off, and an employee is terminated from employment by death, reduction in force, resignation, dismissal, or retirement, any of the employee’s unused vested vacation time or paid time off must be paid to the employee as wages at the employee’s final rate in accordance with the employment policy, practice, or agreement with respect to eligibility and vesting requirements.

This was passed out of committee on 1/30.

SHB 2614/ SB 6349 | Concerning paid family and medical leave. This bill is agency request legislation clearing up some areas with the family and medical leave act, laying out penalty process steps and clarifying certain issues.

HB 2614 passed out of committee on 1/23 and is scheduled before the House Appropriations Committee on 2/3.

SB 6349 is in second reading in Senate Rules.

HB 2739 | Adjusting certain requirements of the shared leave program. Provides that state employees seeking shared leave due to illness, injury, impairment, or physical or mental condition are not required to deplete all of their annual and sick leave before receiving shared leave. Allows intermittent and non-consecutive use of shared leave. This bill is scheduled for Executive Session on 1/31.

HB 2740 | Concerning the employment of individuals who lawfully consume marijuana. This may nor may not affect school districts since all are posted “Drug Free Zones”, but it may be worth a look. This bill is scheduled for Executive Action on 2/4.

SB 6123 | Allowing state employee leave for organ donation. Requires agencies to allow employees to take paid leave as needed, not exceeding 30 days in a two-year period, for participate in life-giving procedures.
This bill is scheduled for Executive Action on 2/5.

SB 6368 | Concerning sick leave for K–12 employees. Leave provided in this proviso not taken shall accumulate from year to year. Such accumulated time may be taken at any time during the school year may be used for the purpose of payments for unused sick leave in accordance with RCW 28A.400.210.

SB 6368 has been scheduled for a public hearing before the Senate Education Committee on 2/3. It was previously scheduled for a public hearing, but the committee time was cut short due to extended floor action by the Senate. Two Superintendents had registered to testify ‘Con’ on this bill due to its unfunded costs.

SEBB Meeting Summary

The SEBB Board held an all-day meeting, updating the Board and covering a wide range of issues. Read the briefing book with supporting materials.

This summary is just some highlights broken down by Tab.

The HCA/SEBB staff took time to thank the Board and staff for the quality work that was done to make the SEBB launch/enrollment so successful. They particularly singled out school districts, ESD’s and educational groups such as WASBO as critical and valued players that were valued keys to aiding in the launch.

Overall, and based on feedback from the field, the SEBB/HCA will continue to refine the program and make modification on the MySEBB application.

TAB 4: shows SEBB open enrollment results. Some facts that may be of interest: 1) 98% of eligible employees enrolled or affirmatively waived a medical plan. (143,000); 2% defaulted into UMP Achieve 1 (3,000); 13% waived coverage (19,000) which exceeded SEBB projections of 7%.

Previous to SEBB and based on 2015 data, enrollment in medical coverage increased 29% (57,812 more covered individuals).

Maps are shown in the Tab of the top medical carrier by county and by school district. Vision and Dental enrollments by plan are noted as well.

Enrollment data aside, it was requested by member Cutler that cost to district data be brought to the Board. Member Leonard concurred. Staff indicated data would be hard to get but see Tab 12 below regarding ESD’s.

TAB 5: A legislative update was given. Of note was that the 2020–2021 funding rate had been lowered from $,.056 to $1,029/employee/month because of the increase in waivers and the increased enrollment in the self-funded UMP plans.

The numerous proposed bills dealing with eligibility were summarized. SEBB has distributed surveys to districts to get data on the number and categories of those that have qualified, espec