Local Government Financial Assistance — $101.8 million General Fund-State, $33.2 million Health Services Account

Funds are provided to local jurisdictions to help maintain public safety, criminal justice, and public health programs affected by the passage of Initiative 695.

• Assistance to Counties — $35.5 million General Fund-State: This budget provides $35.5 million in ongoing funding to counties for public safety assistance, court operations, and other services. For the 1990-91 fiscal biennium, funding is restored at 53 percent of total Motor Vehicle Excise Tax losses.
• Assistance to Cities — $66.3 million General Fund-State: Ongoing funding is provided for criminal justice, and fire and police protection and other services to offset Motor Vehicle Excise Tax losses at the city level. For the fiscal 1999-01 biennium, funding is restored through the end of the biennium at 37 percent. Additional funds are provided to ensure that no city will suffer a budgetary loss in excess of 7.5 percent.
• Public health — $33.2 million from the Health Services Account: Ongoing funding is provided to restore 90 percent of funding losses to public health districts and county public health programs.

Retirement — SSB 6530

The legislation creates a hybrid defined benefit/defined contribution retirement plan in PERS which would be similar to the plan currently in place for teachers and the plan which will go into effect for classified school employees in September 2000.

Features of the bill include:

• The Early Retirement Reduction Factors for PERS 2, PERS 3, SERS 2, SERS 3, members aged 55 with 30 years of service are lowered to 3% per year from age 65.
• Current PERS 2 members will have an option to move to PERS 3. The window for other PERS employees will be nine months beginning in September 2002.
• PERS 2 members who transfer to PERS 3 will receive a 110% transfer payment and gain-sharing in June 2003.
• PERS 3 members get to choose how much they contribute from six options (ranging from 5 to 15%) and can self-direct their investments or let their account be managed by the State Investment Board.

SERS Transfer Payment Increase — SSB 6531

The Washington School Employees’ Retirement System (SERS) will go into effect in September 2000. Members of SERS Plan 2 who transfer to SERS Plan 3 will receive a transfer payment in March 2001 based on their account balance as of January 1, 2000. The legislation increases the transfer payment from 65% to 130% of the member’s account balance.

Increased Eligibility for School Employees to Cash Out Sick Leave — SB 6534

Employees of school districts may currently cash out a portion of their accumulated sick leave when they retire or die. The legislation allows school employees who are at least age 55 and have at least 10 years of service to cash out this leave when they separate from service. Effective June 8, 2000.

Flexible Survivor Benefits — SHB 2604

The legislation authorizes DRS to provide retirees with two options for changing their survivor benefit designation after retirement:

• Post-Retirement Marriage: A member who did not choose a survivor benefit when they retired would be given an opportunity to name their spouse as beneficiary if the retiree marries after retirement.
• Non-Spouse Beneficiary: A retiree who provides a survivor benefit to someone other than their spouse at the time of retirement would have the option to cancel that benefit. The survivor benefit reduction to the retiree’s pension would also be canceled.

DRS will provide these options for all retirees by July 1, 2001. Retirees aged 90 or more will be able to choose these options by July 1, 2000.