SB 2767 - Employees' Retirement System Summary

• Amends Hawaii Revised Statutes Chapter 88 to maintain the Employees' Retirement System as a tax-qualified plan under Section 401(a) of the Internal Revenue Code.

• Modifies service credit acquisition provisions in Section 88-59 by eliminating the deduction method for payments made after June 30, 2020, and requiring lump sum payments equal to the actuarial cost of membership service (limited to members with at least five years of existing membership).

• Makes parallel amendments to Section 88-324 for both general membership service credit and service credit for former Class A or B members as of June 30, 2006, with the same July 1, 2020 effective date for the new actuarial cost payment method.

• For payments made prior to July 1, 2020, members may choose deductions from compensation at twice or 1.5 times the contribution rate, or lump sum payments based on standard contribution rates.

• Takes effect upon approval.