SB 1360: Employees' Retirement System; Required Beginning Dates; Automatic Payments
- Session Year: 2025-2026
- House: Senate
- Latest Version Date: 2025-04-04
Current Status:
In Progress
(2025-05-15: Act 052, on 05/15/2025 (Gov. Msg. No. 1152).)
Introduced
In Committee
First Chamber
In Committee
Second Chamber
Final Decking
Enacted
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended. (HD2)
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended. Effective 7/1/3000. (HD1)
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended. (SD1)
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended.
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THE SENATE |
S.B. NO. |
1360 |
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THIRTY-THIRD LEGISLATURE, 2025 |
S.D. 1 |
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STATE OF HAWAII |
H.D. 2 |
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A BILL FOR AN ACT
RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The purpose of this Act is to maintain the employees' retirement system of the State of Hawaii's (the "system") federal tax qualification requirements by conforming chapter 88, Hawaii Revised Statutes, to the updated requirements of the Internal Revenue Code of 1986, as amended, regarding automatic disbursements, including required minimum distributions, by the SECURE 2.0 Act of 2022.
SECTION 2. Section 88-74.7, Hawaii Revised Statutes, is amended to read as follows:
"§88-74.7
Commencement of benefits on required
beginning date. (a) The purpose of this section is to provide for
distribution of benefits in accordance with a reasonable and good faith
interpretation of section 401(a)(9) of the Internal Revenue Code. Section 401(a)(9) of the Internal Revenue
Code requires that the "entire interest" of a member be distributed
or that distribution of the member's benefits begin no later than the member's
"required beginning date"[.], as defined in section
401(a)(9) of the Internal Revenue Code of 1986, as amended.
[(b) For the purposes of this section,
"required beginning date" means April 1 of the calendar year
following the calendar year in which a member terminates service or attains age
seventy and one-half, whichever is later.
(c)]
(b) A member or former member's
accumulated contributions or hypothetical account balance, as defined in
section 88-311, shall be paid to the member or former member, or payment of the
benefits payable under part II, VII, or VIII of this chapter shall commence, no
later than the member's or former member's required beginning date. The payment or payments shall be made on, or
beginning no later than, the member's or former member's required beginning
date even if the member or former member does not apply for payment or file a
retirement application.
[(d)]
(c) If,
by a member's or former member's required beginning date:
(1) The member or former member's accumulated contributions or hypothetical account balance, as defined in section 88-311, are not paid to the member or former member; or
(2) Payment of the benefits payable under part II, VII, or VIII of this chapter do not commence,
the system shall pay the service retirement benefits for which the member or former member is eligible pursuant to part II, VII, or VIII of this chapter, as applicable, retroactive to the member's or former member's required beginning date with regular interest.
[(e)]
(d) If the system does not
receive a written election from the member or former member under section 88-83,
88-283, or 88-333, as applicable, prior to the later of the member's or former
member's required beginning date or sixty days following the receipt by the
member or former member of notice from the system that the member or former
member is required to make an election, the following election shall be deemed
to have been made as of the member or former member's required beginning date:
(1) If the member or former member is unmarried or has no reciprocal beneficiary, the member or former member shall be deemed to have elected the maximum retirement allowance; or
(2) If the member or former member is married or has a reciprocal beneficiary, the member or former member shall be deemed to have elected option 3 under section 88-83, or option A under section 88-283, as applicable, and to have designated the member's or former member's spouse or reciprocal beneficiary as the member's or former member's beneficiary;
provided that if the system receives the written election after the member's or former member's required beginning date, but within sixty days following receipt by the member or former member of notice from the system that the member or former member is required to make the election, the written election shall apply, and the member's or former member's retirement benefit shall be recomputed, based on the written election, retroactive to the member or former member's required beginning date. The amount of any underpayment resulting from recomputing the benefit shall bear regular interest. If recomputing the benefit results in an overpayment, payments shall be adjusted so that the actuarial equivalent of the benefit to which the member or former member was correctly entitled shall be paid.
[(f)]
(e) If the system does not have
current information about the member's or former member's marital or reciprocal
beneficiary status at the time of a deemed election,
the following presumptions shall apply:
(1) If the member or former member was married or had a reciprocal beneficiary at the time the member or former member last provided information to the system about the member's or former member's marital or reciprocal beneficiary status, it shall be presumed that the member or former member is still married to the same spouse or is in the same reciprocal beneficiary relationship. If the system does not have information as to the age of the spouse or reciprocal beneficiary, the spouse or reciprocal beneficiary shall be presumed to be forty years younger than the member or former member for purposes of computing the member's or former member's benefit; and
(2) If the member or former member was unmarried and did not have a reciprocal beneficiary at the time the member or former member last provided information to the system about the member or former member's marital status, it shall be presumed that the member or former member is married and that the spouse of the member or former member is forty years younger than the member or former member.
[(g)]
(f) The presumptions in
subsection [(f)] (e) shall cease to apply
when the member or former member provides the system with current information
as to the member's or former member's marital or reciprocal beneficiary status
and the age of the member or former member's spouse or reciprocal beneficiary,
if any, on the member's or former member's required beginning date. The information shall be provided in a form
satisfactory to the system. At that
time, the member's or former member's retirement allowance shall be recomputed,
retroactive to the member's or former member's required beginning date, based
on the updated information; provided that, except as provided in subsection [(e),]
(d), the member or former member shall not be permitted to change the
member's or former member's retirement allowance option election or
beneficiary; provided further that the benefit being paid to any member or
former member who, on the member's or former member's required beginning date,
was unmarried and did not have a reciprocal beneficiary, but who was deemed to
elect option 3 or option A with an assumed spouse or reciprocal beneficiary,
shall be converted to the maximum retirement allowance retroactive to the
member's or former member's required beginning date. The amount of any underpayment resulting from
recomputing the benefit shall bear regular interest. If recomputing the benefit results in an
overpayment, payments shall be adjusted so that the actuarial equivalent of the
benefit to which the member or former member was correctly entitled shall be
paid.
[(h)]
(g) If the system cannot locate
the member or former member, the member's or former member's benefit shall be
payable only until the end of the member's or former member's life expectancy,
as determined at the member's or former member's
required beginning date. If the member
or former member has not by that time made a claim for benefits, the member or
former member shall be deemed to be deceased at that time. Interest under subsection [(d)] (c)
shall cease on benefits presumed to be abandoned property, pursuant to part I
of chapter 523A, upon payment of the property to the administrator under part I
of chapter 523A.
[(i)] (h) Rules necessary for the purposes of this
section shall be adopted as provided in section 88-22.5."
SECTION 3. Section 88-321, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
"(b) Notwithstanding any other law to the contrary:
(1) A class C member who returns to service after June 30, 2006, and who does not return to service as a class A or class B member shall become a class H member upon return to service; provided that, if the member is a former class A or class B member who received a refund of contributions picked up and paid by the member's employer pursuant to section 88-46(b), the member may not become a class H member and shall return to service as a class C member, unless the refund was made pursuant to section 88-96 or 88-271(b);
(2) A class A or a class B member, who
returns to service after June 30, 2006, but does not have vested benefit status
as provided in section 88-96(b) and who does not return to service as a class A
or class B member, shall become a class H member upon return to service and the
member's credited service as a class A or B member shall be converted to class
C credited service. The system shall
return to the member the member's accumulated contributions if the member's
accumulated contributions are $1,000 or less at the time of distribution. If the member's accumulated contributions for
the class A or B credited service that was converted to class C credited
service are greater than $1,000 and the member does not make written
application, contemporaneously with the member's return to service, for return
of such contributions, the member, except as provided by section 88-341, may
not withdraw the member's accumulated contributions for the class A or B
credited service that was converted to class C credited service until the
member retires or [attains age sixty-two;] pursuant to sections
88-22.5 and 88‑74.7;
(3) A class A member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member; and
(4) A class B member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member."
SECTION 4. Section 88-341, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) Any class H member who ceases to be an employee and who became a member before July 1, 2012, and has fewer than five years of credited service, excluding unused sick leave, or who becomes a member after June 30, 2012, and has fewer than ten years of credited service, excluding unused sick leave, shall, upon application to the board, be paid all of the former employee's accumulated contributions, and the former employee's membership shall thereupon terminate and all credited service shall be forfeited; provided that an individual shall not be paid the individual's accumulated contributions if either:
(1) The individual becomes an employee again within fifteen calendar days from the date the individual ceased to be an employee; or
(2) At the time the application for return of accumulated contributions is received by the board, the individual has become an employee again.
Regular interest shall be credited to the
former employee's account until the former employee's accumulated contributions
are withdrawn; provided that the former employee's membership shall not
continue after the fourth full year following the calendar year in which the
individual's employment terminates. If
the former employee does not become an employee again and has not withdrawn the
former employee's accumulated contributions, the system shall return the former
employee's accumulated contributions to the former employee [as soon as
possible after the later of: (A) the
former employee attaining age sixty-two; or (B) the termination of the former
employee's membership.] pursuant to sections 88-22.5 and 88-74.7."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act shall take effect upon its approval.
Report Title:
Employees' Retirement System; Required Beginning Dates; Automatic Payments
Description:
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended. (HD2)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
|
THE SENATE |
S.B. NO. |
1360 |
|
THIRTY-THIRD LEGISLATURE, 2025 |
S.D. 1 |
|
|
STATE OF HAWAII |
H.D. 1 |
|
|
|
|
|
|
|
||
|
|
||
A BILL FOR AN ACT
RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The purpose of this Act is to maintain the employees' retirement system of the State of Hawaii's (the "system") federal tax qualification requirements by conforming chapter 88, Hawaii Revised Statutes, to the updated requirements of the Internal Revenue Code of 1986, as amended, regarding automatic disbursements, including required minimum distributions, by the SECURE 2.0 Act of 2022.
SECTION 2. Section 88-74.7, Hawaii Revised Statutes, is amended to read as follows:
"§88-74.7
Commencement of benefits on required
beginning date. (a) The purpose of this section is to provide for
distribution of benefits in accordance with a reasonable and good faith
interpretation of section 401(a)(9) of the Internal Revenue Code. Section 401(a)(9) of the Internal Revenue
Code requires that the "entire interest" of a member be distributed
or that distribution of the member's benefits begin no later than the member's
"required beginning date"[.], as defined in section
401(a)(9) of the Internal Revenue Code of 1986, as amended.
[(b) For the purposes of this section,
"required beginning date" means April 1 of the calendar year
following the calendar year in which a member terminates service or attains age
seventy and one-half, whichever is later.
(c)]
(b) A member or former member's
accumulated contributions or hypothetical account balance, as defined in
section 88-311, shall be paid to the member or former member, or payment of the
benefits payable under part II, VII, or VIII of this chapter shall commence, no
later than the member's or former member's required beginning date. The payment or payments shall be made on, or
beginning no later than, the member's or former member's required beginning
date even if the member or former member does not apply for payment or file a
retirement application.
[(d)]
(c) If,
by a member's or former member's required beginning date:
(1) The member or former member's accumulated contributions or hypothetical account balance, as defined in section 88-311, are not paid to the member or former member; or
(2) Payment of the benefits payable under part II, VII, or VIII of this chapter do not commence,
the system shall pay the service retirement benefits for which the member or former member is eligible pursuant to part II, VII, or VIII of this chapter, as applicable, retroactive to the member's or former member's required beginning date with regular interest.
[(e)]
(d) If the system does not
receive a written election from the member or former member under section 88-83,
88-283, or 88-333, as applicable, prior to the later of the member's or former
member's required beginning date or sixty days following the receipt by the
member or former member of notice from the system that the member or former
member is required to make an election, the following election shall be deemed
to have been made as of the member or former member's required beginning date:
(1) If the member or former member is unmarried or has no reciprocal beneficiary, the member or former member shall be deemed to have elected the maximum retirement allowance; or
(2) If the member or former member is married or has a reciprocal beneficiary, the member or former member shall be deemed to have elected option 3 under section 88-83, or option A under section 88-283, as applicable, and to have designated the member's or former member's spouse or reciprocal beneficiary as the member's or former member's beneficiary;
provided that if the system receives the written election after the member's or former member's required beginning date, but within sixty days following receipt by the member or former member of notice from the system that the member or former member is required to make the election, the written election shall apply, and the member's or former member's retirement benefit shall be recomputed, based on the written election, retroactive to the member or former member's required beginning date. The amount of any underpayment resulting from recomputing the benefit shall bear regular interest. If recomputing the benefit results in an overpayment, payments shall be adjusted so that the actuarial equivalent of the benefit to which the member or former member was correctly entitled shall be paid.
[(f)]
(e) If the system does not have
current information about the member's or former member's marital or reciprocal
beneficiary status at the time of a deemed election,
the following presumptions shall apply:
(1) If the member or former member was married or had a reciprocal beneficiary at the time the member or former member last provided information to the system about the member's or former member's marital or reciprocal beneficiary status, it shall be presumed that the member or former member is still married to the same spouse or is in the same reciprocal beneficiary relationship. If the system does not have information as to the age of the spouse or reciprocal beneficiary, the spouse or reciprocal beneficiary shall be presumed to be forty years younger than the member or former member for purposes of computing the member's or former member's benefit; and
(2) If the member or former member was unmarried and did not have a reciprocal beneficiary at the time the member or former member last provided information to the system about the member or former member's marital status, it shall be presumed that the member or former member is married and that the spouse of the member or former member is forty years younger than the member or former member.
[(g)]
(f) The presumptions in
subsection [(f)] (e) shall cease to apply
when the member or former member provides the system with current information
as to the member's or former member's marital or reciprocal beneficiary status
and the age of the member or former member's spouse or reciprocal beneficiary,
if any, on the member's or former member's required beginning date. The information shall be provided in a form
satisfactory to the system. At that
time, the member's or former member's retirement allowance shall be recomputed,
retroactive to the member's or former member's required beginning date, based
on the updated information; provided that, except as provided in subsection [(e),]
(d), the member or former member shall not be permitted to change the
member's or former member's retirement allowance option election or
beneficiary; provided further that the benefit being paid to any member or
former member who, on the member's or former member's required beginning date,
was unmarried and did not have a reciprocal beneficiary, but who was deemed to
elect option 3 or option A with an assumed spouse or reciprocal beneficiary,
shall be converted to the maximum retirement allowance retroactive to the
member's or former member's required beginning date. The amount of any underpayment resulting from
recomputing the benefit shall bear regular interest. If recomputing the benefit results in an
overpayment, payments shall be adjusted so that the actuarial equivalent of the
benefit to which the member or former member was correctly entitled shall be
paid.
[(h)]
(g) If the system cannot locate
the member or former member, the member's or former member's benefit shall be
payable only until the end of the member's or former member's life expectancy,
as determined at the member's or former member's
required beginning date. If the member
or former member has not by that time made a claim for benefits, the member or
former member shall be deemed to be deceased at that time. Interest under subsection [(d)] (c)
shall cease on benefits presumed to be abandoned property, pursuant to part I
of chapter 523A, upon payment of the property to the administrator under part I
of chapter 523A.
[(i)] (h) Rules necessary for the purposes of this
section shall be adopted as provided in section 88-22.5."
SECTION 3. Section 88-321, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
"(b) Notwithstanding any other law to the contrary:
(1) A class C member who returns to service after June 30, 2006, and who does not return to service as a class A or class B member shall become a class H member upon return to service; provided that, if the member is a former class A or class B member who received a refund of contributions picked up and paid by the member's employer pursuant to section 88-46(b), the member may not become a class H member and shall return to service as a class C member, unless the refund was made pursuant to section 88-96 or 88-271(b);
(2) A class A or a class B member, who
returns to service after June 30, 2006, but does not have vested benefit status
as provided in section 88-96(b) and who does not return to service as a class A
or class B member, shall become a class H member upon return to service and the
member's credited service as a class A or B member shall be converted to class
C credited service. The system shall
return to the member the member's accumulated contributions if the member's
accumulated contributions are $1,000 or less at the time of distribution. If the member's accumulated contributions for
the class A or B credited service that was converted to class C credited
service are greater than $1,000 and the member does not make written
application, contemporaneously with the member's return to service, for return
of such contributions, the member, except as provided by section 88-341, may
not withdraw the member's accumulated contributions for the class A or B
credited service that was converted to class C credited service until the
member retires or [attains age sixty-two;] pursuant to sections
88-22.5 and 88‑74.7;
(3) A class A member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member; and
(4) A class B member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member."
SECTION 4. Section 88-341, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) Any class H member who ceases to be an employee and who became a member before July 1, 2012, and has fewer than five years of credited service, excluding unused sick leave, or who becomes a member after June 30, 2012, and has fewer than ten years of credited service, excluding unused sick leave, shall, upon application to the board, be paid all of the former employee's accumulated contributions, and the former employee's membership shall thereupon terminate and all credited service shall be forfeited; provided that an individual shall not be paid the individual's accumulated contributions if either:
(1) The individual becomes an employee again within fifteen calendar days from the date the individual ceased to be an employee; or
(2) At the time the application for return of accumulated contributions is received by the board, the individual has become an employee again.
Regular interest shall be credited to the
former employee's account until the former employee's accumulated contributions
are withdrawn; provided that the former employee's membership shall not
continue after the fourth full year following the calendar year in which the
individual's employment terminates. If
the former employee does not become an employee again and has not withdrawn the
former employee's accumulated contributions, the system shall return the former
employee's accumulated contributions to the former employee [as soon as
possible after the later of: (A) the
former employee attaining age sixty-two; or (B) the termination of the former
employee's membership.] pursuant to sections 88-22.5 and 88-74.7."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act shall take effect on July 1, 3000.
Report Title:
Employees' Retirement System; Required Beginning Dates; Automatic Payments
Description:
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended. Effective 7/1/3000. (HD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
|
THE SENATE |
S.B. NO. |
1360 |
|
THIRTY-THIRD LEGISLATURE, 2025 |
S.D. 1 |
|
|
STATE OF HAWAII |
|
|
|
|
|
|
|
|
||
|
|
||
A BILL FOR AN ACT
RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The purpose of this Act is to maintain the employees' retirement system of the State of Hawaii's (the "system") federal tax qualification requirements by conforming chapter 88, Hawaii Revised Statutes, to the updated requirements of the Internal Revenue Code of 1986, as amended, regarding automatic disbursements, including required minimum distributions, by the SECURE 2.0 Act of 2022.
SECTION 2. Section 88-74.7, Hawaii Revised Statutes, is amended to read as follows:
"§88-74.7
Commencement of benefits on required
beginning date. (a) The purpose of this section is to provide for
distribution of benefits in accordance with a reasonable and good faith
interpretation of section 401(a)(9) of the Internal Revenue Code. Section 401(a)(9) of the Internal Revenue
Code requires that the "entire interest" of a member be distributed
or that distribution of the member's benefits begin no later than the member's
"required beginning date"[.], as defined in section
401(a)(9) of the Internal Revenue Code of 1986, as amended.
[(b) For the purposes of this section,
"required beginning date" means April 1 of the calendar year
following the calendar year in which a member terminates service or attains age
seventy and one-half, whichever is later.
(c)]
(b) A member or former member's
accumulated contributions or hypothetical account balance, as defined in
section 88-311, shall be paid to the member or former member, or payment of the
benefits payable under part II, VII, or VIII of this chapter shall commence, no
later than the member's or former member's required beginning date. The payment or payments shall be made on, or
beginning no later than, the member's or former member's required beginning
date even if the member or former member does not apply for payment or file a
retirement application.
[(d)]
(c) If,
by a member's or former member's required beginning date:
(1) The member or former member's accumulated contributions or hypothetical account balance, as defined in section 88-311, are not paid to the member or former member; or
(2) Payment of the benefits payable under part II, VII, or VIII of this chapter do not commence,
the system shall pay the service retirement benefits for which the member or former member is eligible pursuant to part II, VII, or VIII of this chapter, as applicable, retroactive to the member's or former member's required beginning date with regular interest.
[(e)]
(d) If the system does not
receive a written election from the member or former member under section 88-83,
88-283, or 88-333, as applicable, prior to the later of the member's or former
member's required beginning date or sixty days following the receipt by the
member or former member of notice from the system that the member or former
member is required to make an election, the following election shall be deemed
to have been made as of the member or former member's required beginning date:
(1) If the member or former member is unmarried or has no reciprocal beneficiary, the member or former member shall be deemed to have elected the maximum retirement allowance; or
(2) If the member or former member is married or has a reciprocal beneficiary, the member or former member shall be deemed to have elected option 3 under section 88-83, or option A under section 88-283, as applicable, and to have designated the member's or former member's spouse or reciprocal beneficiary as the member's or former member's beneficiary;
provided that if the system receives the written election after the member's or former member's required beginning date, but within sixty days following receipt by the member or former member of notice from the system that the member or former member is required to make the election, the written election shall apply, and the member's or former member's retirement benefit shall be recomputed, based on the written election, retroactive to the member or former member's required beginning date. The amount of any underpayment resulting from recomputing the benefit shall bear regular interest. If recomputing the benefit results in an overpayment, payments shall be adjusted so that the actuarial equivalent of the benefit to which the member or former member was correctly entitled shall be paid.
[(f)]
(e) If the system does not have
current information about the member's or former member's marital or reciprocal
beneficiary status at the time of a deemed election,
the following presumptions shall apply:
(1) If the member or former member was married or had a reciprocal beneficiary at the time the member or former member last provided information to the system about the member's or former member's marital or reciprocal beneficiary status, it shall be presumed that the member or former member is still married to the same spouse or is in the same reciprocal beneficiary relationship. If the system does not have information as to the age of the spouse or reciprocal beneficiary, the spouse or reciprocal beneficiary shall be presumed to be forty years younger than the member or former member for purposes of computing the member's or former member's benefit; and
(2) If the member or former member was unmarried and did not have a reciprocal beneficiary at the time the member or former member last provided information to the system about the member or former member's marital status, it shall be presumed that the member or former member is married and that the spouse of the member or former member is forty years younger than the member or former member.
[(g)]
(f) The presumptions in
subsection [(f)] (e) shall cease to apply
when the member or former member provides the system with current information
as to the member's or former member's marital or reciprocal beneficiary status
and the age of the member or former member's spouse or reciprocal beneficiary,
if any, on the member's or former member's required beginning date. The information shall be provided in a form
satisfactory to the system. At that
time, the member's or former member's retirement allowance shall be recomputed,
retroactive to the member's or former member's required beginning date, based
on the updated information; provided that, except as provided in subsection [(e),]
(d), the member or former member shall not be permitted to change the
member's or former member's retirement allowance option election or
beneficiary; provided further that the benefit being paid to any member or
former member who, on the member's or former member's required beginning date,
was unmarried and did not have a reciprocal beneficiary, but who was deemed to
elect option 3 or option A with an assumed spouse or reciprocal beneficiary,
shall be converted to the maximum retirement allowance retroactive to the
member's or former member's required beginning date. The amount of any underpayment resulting from
recomputing the benefit shall bear regular interest. If recomputing the benefit results in an
overpayment, payments shall be adjusted so that the actuarial equivalent of the
benefit to which the member or former member was correctly entitled shall be
paid.
[(h)]
(g) If the system cannot locate
the member or former member, the member's or former member's benefit shall be
payable only until the end of the member's or former member's life expectancy,
as determined at the member's or former member's
required beginning date. If the member
or former member has not by that time made a claim for benefits, the member or
former member shall be deemed to be deceased at that time. Interest under subsection [(d)] (c)
shall cease on benefits presumed to be abandoned property, pursuant to part I
of chapter 523A, upon payment of the property to the administrator under part I
of chapter 523A.
[(i)] (h) Rules necessary for the purposes of this
section shall be adopted as provided in section 88-22.5."
SECTION 3. Section 88-321, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
"(b) Notwithstanding any other law to the contrary:
(1) A class C member who returns to service after June 30, 2006, and who does not return to service as a class A or class B member shall become a class H member upon return to service; provided that, if the member is a former class A or class B member who received a refund of contributions picked up and paid by the member's employer pursuant to section 88-46(b), the member may not become a class H member and shall return to service as a class C member, unless the refund was made pursuant to section 88-96 or 88-271(b);
(2) A class A or a class B member, who
returns to service after June 30, 2006, but does not have vested benefit status
as provided in section 88-96(b) and who does not return to service as a class A
or class B member, shall become a class H member upon return to service and the
member's credited service as a class A or B member shall be converted to class
C credited service. The system shall
return to the member the member's accumulated contributions if the member's accumulated
contributions are $1,000 or less at the time of distribution. If the member's accumulated contributions for
the class A or B credited service that was converted to class C credited
service are greater than $1,000 and the member does not make written
application, contemporaneously with the member's return to service, for return
of such contributions, the member, except as provided by section 88-341, may
not withdraw the member's accumulated contributions for the class A or B
credited service that was converted to class C credited service until the
member retires or [attains age sixty-two;] pursuant to sections
88-22.5 and 88‑74.7;
(3) A class A member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member; and
(4) A class B member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member."
SECTION 4. Section 88-341, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) Any class H member who ceases to be an employee and who became a member before July 1, 2012, and has fewer than five years of credited service, excluding unused sick leave, or who becomes a member after June 30, 2012, and has fewer than ten years of credited service, excluding unused sick leave, shall, upon application to the board, be paid all of the former employee's accumulated contributions, and the former employee's membership shall thereupon terminate and all credited service shall be forfeited; provided that an individual shall not be paid the individual's accumulated contributions if either:
(1) The individual becomes an employee again within fifteen calendar days from the date the individual ceased to be an employee; or
(2) At the time the application for return of accumulated contributions is received by the board, the individual has become an employee again.
Regular interest shall be credited to the
former employee's account until the former employee's accumulated contributions
are withdrawn; provided that the former employee's membership shall not
continue after the fourth full year following the calendar year in which the
individual's employment terminates. If
the former employee does not become an employee again and has not withdrawn the
former employee's accumulated contributions, the system shall return the former
employee's accumulated contributions to the former employee [as soon as
possible after the later of: (A) the
former employee attaining age sixty-two; or (B) the termination of the former
employee's membership.] pursuant to sections 88-22.5 and 88-74.7."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act shall take effect upon its approval.
Report Title:
Employees' Retirement System; Required Beginning Dates; Automatic Payments
Description:
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended. (SD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
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THE SENATE |
S.B. NO. |
1360 |
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THIRTY-THIRD LEGISLATURE, 2025 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The purpose of this Act is to maintain the employees' retirement system of the State of Hawaii's (the "system") federal tax qualification requirements by conforming chapter 88, Hawaii Revised Statutes, to updated requirements of the Internal Revenue Code of 1986, as amended, regarding automatic disbursements, including required minimum distributions, by the Setting Every Community Up for Retirement Enhancement 2.0 Act of 2022.
SECTION 2. Section 88-74.7, Hawaii Revised Statutes, is amended to read as follows:
"§88-74.7
Commencement of benefits on required
beginning date. (a) The purpose of this section is to provide for
distribution of benefits in accordance with a reasonable and good faith
interpretation of section 401(a)(9) of the Internal Revenue Code. Section 401(a)(9) of the Internal Revenue
Code requires that the "entire interest" of a member be distributed
or that distribution of the member's benefits begin no later than the member's
"required beginning date"[.], as defined in section
401(a)(9) of the Internal Revenue Code of 1986, as amended.
[(b) For the purposes of this section,
"required beginning date" means April 1 of the calendar year
following the calendar year in which a member terminates service or attains age
seventy and one-half, whichever is later.
(c)]
(b) A member or former member's
accumulated contributions or hypothetical account balance, as defined in
section 88-311, shall be paid to the member or former member, or payment of the
benefits payable under part II, VII, or VIII of this chapter shall commence, no
later than the member's or former member's required beginning date. The payment or payments shall be made on, or
beginning no later than, the member's or former member's required beginning
date even if the member or former member does not apply for payment or file a
retirement application.
[(d)]
(c) If,
by a member's or former member's required beginning date:
(1) The member or former member's accumulated contributions or hypothetical account balance, as defined in section 88-311, are not paid to the member or former member; or
(2) Payment of the benefits payable under part II, VII, or VIII of this chapter do not commence,
the system shall pay the service retirement benefits for which the member or former member is eligible pursuant to part II, VII, or VIII of this chapter, as applicable, retroactive to the member's or former member's required beginning date with regular interest.
[(e)]
(d) If the system does not
receive a written election from the member or former member under section 88-83,
88-283, or 88-333, as applicable, prior to the later of the member's or former
member's required beginning date or sixty days following the receipt by the
member or former member of notice from the system that the member or former
member is required to make an election, the following election shall be deemed
to have been made as of the member or former member's required beginning date:
(1) If the member or former member is unmarried or has no reciprocal beneficiary, the member or former member shall be deemed to have elected the maximum retirement allowance; or
(2) If the member or former member is married or has a reciprocal beneficiary, the member or former member shall be deemed to have elected option 3 under section 88-83, or option A under section 88-283, as applicable, and to have designated the member's or former member's spouse or reciprocal beneficiary as the member's or former member's beneficiary;
provided that if the system receives the written election after the member's or former member's required beginning date, but within sixty days following receipt by the member or former member of notice from the system that the member or former member is required to make the election, the written election shall apply, and the member's or former member's retirement benefit shall be recomputed, based on the written election, retroactive to the member or former member's required beginning date. The amount of any underpayment resulting from recomputing the benefit shall bear regular interest. If recomputing the benefit results in an overpayment, payments shall be adjusted so that the actuarial equivalent of the benefit to which the member or former member was correctly entitled shall be paid.
[(f)]
(e) If the system does not have
current information about the member's or former member's marital or reciprocal
beneficiary status at the time of a deemed election,
the following presumptions shall apply:
(1) If the member or former member was married or had a reciprocal beneficiary at the time the member or former member last provided information to the system about the member's or former member's marital or reciprocal beneficiary status, it shall be presumed that the member or former member is still married to the same spouse or is in the same reciprocal beneficiary relationship. If the system does not have information as to the age of the spouse or reciprocal beneficiary, the spouse or reciprocal beneficiary shall be presumed to be forty years younger than the member or former member for purposes of computing the member's or former member's benefit; and
(2) If the member or former member was unmarried and did not have a reciprocal beneficiary at the time the member or former member last provided information to the system about the member or former member's marital status, it shall be presumed that the member or former member is married and that the spouse of the member or former member is forty years younger than the member or former member.
[(g)]
(f) The presumptions in
subsection [(f)] (e) shall cease to apply
when the member or former member provides the system with current information
as to the member's or former member's marital or reciprocal beneficiary status
and the age of the member or former member's spouse or reciprocal beneficiary,
if any, on the member's or former member's required beginning date. The information shall be provided in a form
satisfactory to the system. At that
time, the member's or former member's retirement allowance shall be recomputed,
retroactive to the member's or former member's required beginning date, based
on the updated information; provided that, except as provided in subsection [(e),]
(d), the member or former member shall not be permitted to change the
member's or former member's retirement allowance option election or
beneficiary; provided further that the benefit being paid to any member or
former member who, on the member's or former member's required beginning date,
was unmarried and did not have a reciprocal beneficiary, but who was deemed to
elect option 3 or option A with an assumed spouse or reciprocal beneficiary,
shall be converted to the maximum retirement allowance retroactive to the
member's or former member's required beginning date. The amount of any underpayment resulting from
recomputing the benefit shall bear regular interest. If recomputing the benefit results in an
overpayment, payments shall be adjusted so that the actuarial equivalent of the
benefit to which the member or former member was correctly entitled shall be
paid.
[(h)]
(g) If the system cannot locate
the member or former member, the member's or former member's benefit shall be
payable only until the end of the member's or former member's life expectancy,
as determined at the member's or former member's
required beginning date. If the member
or former member has not by that time made a claim for benefits, the member or
former member shall be deemed to be deceased at that time. Interest under subsection [(d)] (c)
shall cease on benefits presumed to be abandoned property, pursuant to part I
of chapter 523A, upon payment of the property to the administrator under part I
of chapter 523A.
[(i)] (h) Rules necessary for the purposes of this
section shall be adopted as provided in section 88-22.5."
SECTION 3. Section 88-321, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
"(b) Notwithstanding any other law to the contrary:
(1) A class C member who returns to service after June 30, 2006, and who does not return to service as a class A or class B member shall become a class H member upon return to service; provided that, if the member is a former class A or class B member who received a refund of contributions picked up and paid by the member's employer pursuant to section 88-46(b), the member may not become a class H member and shall return to service as a class C member, unless the refund was made pursuant to section 88-96 or 88-271(b);
(2) A class A or a class B member, who
returns to service after June 30, 2006, but does not have vested benefit status
as provided in section 88-96(b) and who does not return to service as a class A
or class B member, shall become a class H member upon return to service and the
member's credited service as a class A or B member shall be converted to class
C credited service. The system shall
return to the member the member's accumulated contributions if the member's accumulated
contributions are $1,000 or less at the time of distribution. If the member's accumulated contributions for
the class A or B credited service that was converted to class C credited
service are greater than $1,000 and the member does not make written
application, contemporaneously with the member's return to service, for return
of such contributions, the member, except as provided by section 88-341, may
not withdraw the member's accumulated contributions for the class A or B
credited service that was converted to class C credited service until the
member retires or [attains age sixty-two;] pursuant to sections
88-22.5 and 88-74.7;
(3) A class A member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member; and
(4) A class B member who returns to service after June 30, 2008, with vested benefit status and who does not return to service as a class B member shall return to service as a class A member."
SECTION 4. Section 88-341, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) Any class H member who ceases to be an employee and who became a member before July 1, 2012, and has fewer than five years of credited service, excluding unused sick leave, or who becomes a member after June 30, 2012, and has fewer than ten years of credited service, excluding unused sick leave, shall, upon application to the board, be paid all of the former employee's accumulated contributions, and the former employee's membership shall thereupon terminate and all credited service shall be forfeited; provided that an individual shall not be paid the individual's accumulated contributions if either:
(1) The individual becomes an employee again within fifteen calendar days from the date the individual ceased to be an employee; or
(2) At the time the application for return of accumulated contributions is received by the board, the individual has become an employee again.
Regular interest shall be credited to the
former employee's account until the former employee's accumulated contributions
are withdrawn; provided that the former employee's membership shall not
continue after the fourth full year following the calendar year in which the
individual's employment terminates. If the former employee does not become an
employee again and has not withdrawn the former employee's accumulated
contributions, the system shall return the former employee's accumulated
contributions to the former employee [as soon as possible after the later
of: (A) the former employee attaining
age sixty-two; or (B) the termination of the former employee's membership.]
pursuant to sections 88-22.5 and 88-74.7."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act shall take effect upon its approval.
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INTRODUCED BY: |
_____________________________ |
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BY REQUEST |
Report Title:
Employees' Retirement System; Required Beginning Dates; Automatic Payments
Description:
Amends chapter 88, HRS, to conform to updated required beginning dates and automatic cashout requirements in the Internal Revenue Code of 1986, as amended.
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
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Date
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Status
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| May 15, 2025 | Act 052, on 05/15/2025 (Gov. Msg. No. 1152). |
| May 15, 2025 | Act 052, 05/15/2025 (Gov. Msg. No. 1152). |
| Apr 16, 2025 | Enrolled to Governor. |
| Apr 16, 2025 | Received notice of Final Reading (Sen. Com. No. 806). |
| Apr 16, 2025 | Passed Final Reading. Ayes, 23; Aye(s) with reservations: none. Noes, 0 (none). Excused, 2 (Senator(s) Fevella, Ihara). |
| Apr 15, 2025 | Received notice of reconsideration and Senate agreement (Sen. Com. No. 786). |
| Apr 15, 2025 | One Day Notice 04-16-25 |
| Apr 15, 2025 | Senate agrees with House amendments. Placed on the calendar for Final Reading on 04-16-25. |
| Apr 15, 2025 | Reconsideration of action taken on 04-10-25 in disagreeing to the House amendments. |
| Apr 10, 2025 | Received notice of disagreement (Sen. Com. No. 779). |
| Apr 10, 2025 | Senate disagrees with House amendments. |
| Apr 10, 2025 | Received from House (Hse. Com. No. 683). |
| Apr 8, 2025 | Passed Third Reading as amended in HD 2 with none voting aye with reservations; none voting no (0) and Representative(s) Cochran, Marten excused (2). Transmitted to Senate. |
| Apr 4, 2025 | Forty-eight (48) hours notice Tuesday, 04-08-25. |
| Apr 4, 2025 | Reported from FIN (Stand. Com. Rep. No. 1993) as amended in HD 2, recommending passage on Third Reading. |
| Mar 28, 2025 | The committee on FIN recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 14 Ayes: Representative(s) Yamashita, Takenouchi, Grandinetti, Holt, Keohokapu-Lee Loy, Kitagawa, Kusch, Lamosao, Lee, M., Miyake, Morikawa, Templo, Alcos, Reyes Oda; Ayes with reservations: none; Noes: none; and 2 Excused: Representative(s) Hussey, Ward. |
| Mar 25, 2025 | Bill scheduled to be heard by FIN on Friday, 03-28-25 2:00PM in House conference room 308 VIA VIDEOCONFERENCE. |
| Mar 13, 2025 | Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with none voting aye with reservations; none voting no (0) and Representative(s) Cochran, Holt, Ward, Woodson excused (4). |
| Mar 13, 2025 | Reported from LAB (Stand. Com. Rep. No. 1183) as amended in HD 1, recommending passage on Second Reading and referral to FIN. |
| Mar 11, 2025 | The committee on LAB recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 5 Ayes: Representative(s) Sayama, Lee, M., Garrett, Kapela, Kong; Ayes with reservations: none; 0 Noes: none; and 1 Excused: Representative(s) Reyes Oda. |
| Mar 6, 2025 | Bill scheduled to be heard by LAB on Tuesday, 03-11-25 9:30AM in House conference room 309 VIA VIDEOCONFERENCE. |
| Mar 6, 2025 | Referred to LAB, FIN, referral sheet 19 |
| Mar 6, 2025 | Pass First Reading |
| Mar 4, 2025 | Received from Senate (Sen. Com. No. 311) in amended form (SD 1). |
| Mar 4, 2025 | Report adopted; Passed Third Reading, as amended (SD 1). Ayes, 25; Aye(s) with reservations: none . Noes, 0 (none). Excused, 0 (none). Transmitted to House. |
| Feb 27, 2025 | 48 Hrs. Notice 03-04-25. |
| Feb 27, 2025 | Reported from WAM (Stand. Com. Rep. No. 772) with recommendation of passage on Third Reading, as amended (SD 1). |
| Feb 18, 2025 | The committee(s) on WAM recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in WAM were as follows: 12 Aye(s): Senator(s) Dela Cruz, Moriwaki, Aquino, Elefante, Hashimoto, Inouye, Kanuha, Kidani, Kim, Lee, C., Wakai, Fevella; Aye(s) with reservations: none ; 0 No(es): none; and 1 Excused: Senator(s) DeCoite. |
| Feb 14, 2025 | The committee(s) on WAM will hold a public decision making on 02-18-25 10:01AM; Conference Room 211 & Videoconference. |
| Feb 10, 2025 | Report adopted; Passed Second Reading and referred to WAM. |
| Feb 10, 2025 | Reported from LBT (Stand. Com. Rep. No. 200) with recommendation of passage on Second Reading and referral to WAM. |
| Feb 3, 2025 | The committee(s) on LBT recommend(s) that the measure be PASSED, UNAMENDED. The votes in LBT were as follows: 5 Aye(s): Senator(s) Aquino, Lee, C., Ihara, Moriwaki, Fevella; Aye(s) with reservations: none ; 0 No(es): none; and 0 Excused: none. |
| Jan 31, 2025 | The committee(s) on LBT has scheduled a public hearing on 02-03-25 3:30PM; Conference Room 224 & Videoconference. |
| Jan 27, 2025 | Referred to LBT, WAM. |
| Jan 23, 2025 | Introduced and passed First Reading. |
| Jan 21, 2025 | Pending Introduction. |
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Date
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Description
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Location
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Votes
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| Apr 16, 2025 | Final Reading | Senate Floor |
Passed |
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| Apr 8, 2025 | Third Reading | House Floor |
Passed |
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| Mar 28, 2025 | The committee on FIN recommend that the measure be PASSED, WITH AMENDMENTS | House Standing Committee on Finance |
Passed |
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| Mar 11, 2025 | The committee on LAB recommend that the measure be PASSED, WITH AMENDMENTS | House Standing Committee on Labor |
Passed |
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| Mar 4, 2025 | Third Reading | Senate Floor |
Passed |
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| Feb 18, 2025 | The committee(s) on WAM recommend(s) that the measure be PASSED, WITH AMENDMENTS | Senate Standing Committee on Ways and Means |
Passed |
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| Feb 3, 2025 | The committee(s) on LBT recommend(s) that the measure be PASSED, UNAMENDED | Senate Standing Committee on Labor and Technology |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
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| Board of Trustees of the Employees' Retirement System | ** Support | |
| Employees' Retirement System | *** Support | Mar 28, 2025 |
| State of Hawaii | *** Support | Mar 28, 2025 |
STAND. COM. REP. NO. 1993
Honolulu, Hawaii
, 2025
RE: S.B. No. 1360
S.D. 1
H.D. 2
Honorable Nadine K. Nakamura
Speaker, House of Representatives
Thirty-Third State Legislature
Regular Session of 2025
State of Hawaii
Madame:
Your Committee on Finance, to which was referred S.B. No. 1360, S.D. 1, H.D. 1, entitled:
"A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM,"
begs leave to report as follows:
Your Committee has amended this measure by changing its effective date to upon approval.
As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1360, S.D. 1, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 1360, S.D. 1, H.D. 2.
Respectfully submitted on behalf of the members of the Committee on Finance,
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____________________________ KYLE T. YAMASHITA, Chair |
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STAND. COM. REP. NO. 1183
Honolulu, Hawaii
, 2025
RE: S.B. No. 1360
S.D. 1
H.D. 1
Honorable Nadine K. Nakamura
Speaker, House of Representatives
Thirty-Third State Legislature
Regular Session of 2025
State of Hawaii
Madame:
Your Committee on Labor, to which was referred S.B. No. 1360, S.D. 1, entitled:
"A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM,"
begs leave to report as follows:
Your Committee finds that the Employees' Retirement System undergoes burdensome and costly steps to maintain its beneficial federal tax status while distributing the required minimum distributions to its members. Your Committee also finds that the automatic distribution requirement for non-vested hybrid members necessitates third-party retirement accounts which must be separately defined as contributions plans, to avoid tax implications on contributions. The amendments pursuant to this measure streamline the distribution process while ensuring the Employees' Retirement System retains its federal tax status.
Your Committee has amended this measure by changing the effective date to July 1, 3000, to encourage further discussion.
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 S.B. No. 1360, S.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1360, S.D. 1, H.D. 1, and be referred to your Committee on Finance.
Respectfully submitted on behalf of the members of the Committee on Labor,
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____________________________ JACKSON D. SAYAMA, Chair |
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STAND. COM. REP. NO. 772
Honolulu, Hawaii
RE: S.B. No. 1360
S.D. 1
Honorable Ronald D. Kouchi
President of the Senate
Thirty-Third State Legislature
Regular Session of 2025
State of Hawaii
Sir:
Your Committee on Ways and Means, to which was referred S.B. No. 1360 entitled:
"A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM,"
begs leave to report as follows:
The purpose and intent of this measure is to conform the Employees' Retirement System to recent amendments made to the Internal Revenue Code.
Specifically, this measure:
(1) Amends the required beginning date for member benefits to conform to the definition of "required beginning date" in section 401(a)(9) of the Internal Revenue Code of 1986, as amended; and
(2) Conforms to the Internal Revenue Code the process and requirements for the Employees' Retirement System to return the accumulated contributions of former nonvested class A or B members.
Your Committee received written comments in support of this measure from the Employees' Retirement System.
Your Committee finds that this measure will enable the Employees' Retirement System to continue to administer required minimum distributions to members in accordance with the Internal Revenue Code, which will allow members to defer their taxable income and ultimately pay less federal taxes.
Your Committee has amended this measure by:
(1) Correcting a reference to the SECURE 2.0 Act of 2022; and
(2) Making a technical, nonsubstantive amendment for the purposes of clarity and consistency.
As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1360, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 1360, S.D. 1.
Respectfully submitted on behalf of the members of the Committee on Ways and Means,
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________________________________ DONOVAN M. DELA CRUZ, Chair |
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STAND. COM. REP. NO. 200
Honolulu, Hawaii
RE: S.B. No. 1360
Honorable Ronald D. Kouchi
President of the Senate
Thirty-Third State Legislature
Regular Session of 2025
State of Hawaii
Sir:
Your Committee on Labor and Technology, to which was referred S.B. No. 1360 entitled:
"A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM,"
begs leave to report as follows:
The purpose and intent of this measure is to:
(1) Conform the definition of "required beginning date" in chapter 88, Hawaii Revised Statutes, that governs the Employees' Retirement System, to the updated requirements of the Internal Revenue Code of 1986, as amended; and
(2) Repeal the automatic distribution requirement for non‑vested hybrid members so as not to mandate the administration of a third-party retirement account vendor.
Your Committee received testimony in support of this measure from the Employees' Retirement System.
Your Committee finds that the Securing a Strong Retirement Act of 2022 updated the federal tax qualification requirements of the Internal Revenue Code of 1986, as amended. Conforming amendments are needed to the State's Employees' Retirement System to remain in compliance with federal tax qualification requirements. This measure makes conforming amendments by defining "required beginning date" per the Internal Revenue Code of 1986, as amended, and removing the automatic distribution requirement for non-vested hybrid members.
As affirmed by the record of votes of the members of your Committee on Labor and Technology that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1360 and recommends that it pass Second Reading and be referred to your Committee on Ways and Means.
Respectfully submitted on behalf of the members of the Committee on Labor and Technology,
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________________________________ HENRY J.C. AQUINO, Chair |
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Date
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Testimony PDF
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| Mar 28, 2025 | SB1360_HD1_TESTIMONY_FIN_03-28-25_.PDF |
| Mar 11, 2025 | SB1360_SD1_TESTIMONY_LAB_03-11-25_.PDF |
| Feb 17, 2025 | SB1360_TESTIMONY_WAM_02-18-25_.PDF |
| Feb 3, 2025 | SB1360_TESTIMONY_LBT_02-03-25_.PDF |
Bill Author
Bill Co-Author(s):