Pension plan choice

AN ACT Relating to providing additional plan choice to members of 1
the teachers' retirement system plans 2 and 3, the school employees' 2
retirement system plans 2 and 3, and the public employees' retirement 3
systems plans 2 and 3; amending RCW 41.32.835, 41.35.610, and 4
41.40.785; adding a new section to chapter 41.32 RCW; adding a new 5
section to chapter 41.35 RCW; and creating a new section.6
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:7
NEW SECTION. Sec. 1. A new section is added to chapter 41.32 8
RCW under the subchapter heading "plan 3" to read as follows:9
(1) Any plan 3 member who joined plan 3 between July 1, 1996, and 10
June 30, 2007, and as a result was never offered the opportunity to 11
choose between plan 2 and plan 3, may make an irrevocable choice to 12
transfer to plan 2 during any January after the effective date of 13
this section for purposes of future service, provided that the member 14
earns service credit for that month. 15
(2) The legislature reserves the right to modify or discontinue 16
the right to transfer under this section. 17
(3) Any person previously retired from plan 3 is prohibited from 18
transferring to plan 2. 19
H-0542.1
HOUSE BILL 1642
State of Washington 69th Legislature 2025 Regular Session
By Representatives Bronoske, Griffey, Couture, Reeves, Bernbaum,
Shavers, Rule, Salahuddin, Nance, Reed, Goodman, Parshley, Zahn,
Simmons, and Leavitt
Read first time 01/28/25. Referred to Committee on Appropriations.
p. 1 HB 1642
Sec. 2. RCW 41.32.835 and 2019 c 313 s 1 are each amended to 1
read as follows: 2
(1) All teachers who ((first)) become employed by an employer in 3
an eligible position ((on or after July 1, 2007, )) shall have a 4
period of ninety days to make an irrevocable choice for the duration 5
of the employment relationship to become a member of plan 2 or plan 6
3. At the end of ninety days, if the member has not made a choice to 7
become a member of plan 2, he or she becomes a member of plan 3 or 8
plan 2 as follows: 9
(a) ((Becomes a member of plan 3 if first employed by an employer 10
in an eligible position on or after July 1, 2007, but prior to July 11
1, 2020;12
(b))) Becomes a member of plan 2 ((if first employed by an 13
employer in an eligible position on or after July 1, 2020)); or14
(b) Resumes membership in either plan 2 or plan 3 if membership 15
in either plan was previously established. 16
(2) For administrative efficiency, until a member elects to 17
become a member of plan 3, or becomes a member of plan 3 by default 18
under subsection (1) of this section, the member shall be reported to 19
the department in plan 2, with member and employer contributions. 20
Upon becoming a member of plan 3 by election or by default, all 21
service credit shall be transferred to the member's plan 3 defined 22
benefit, and all employee accumulated contributions shall be 23
transferred to the member's plan 3 defined contribution account.24
(3) If a teacher is concurrently employed by two or more 25
employers and has chosen membership in a plan, a teacher remains an 26
active member of plan 2 or plan 3.27
NEW SECTION. Sec. 3. A new section is added to chapter 41.35 28
RCW under the subchapter heading "plan 3" to read as follows:29
(1) Any plan 3 member who joined plan 3 between September 1, 30
2000, and June 30, 2007, and as a result was never offered the 31
opportunity to choose between plan 2 and plan 3, may make an 32
irrevocable choice during any January after the effective date of 33
this section to transfer to plan 3 for purposes of future service.34
(2) The legislature reserves the right to modify or discontinue 35
the right to transfer under this section. 36
(3) Any person previously retired from plan 3 is prohibited from 37
transferring to plan 2. 38
p. 2 HB 1642
Sec. 4. RCW 41.35.610 and 2019 c 313 s 2 are each amended to 1
read as follows: 2
(1) All classified employees who ((first)) become employed by an 3
employer in an eligible position ((on or after July 1, 2007, )) shall 4
have a period of ninety days to make an irrevocable choice for the 5
duration of the employment relationship to become a member of plan 2 6
or plan 3. At the end of ninety days, if the member has not made a 7
choice to become a member of plan 2, he or she becomes a member of 8
plan 3 or plan 2 as follows: 9
(a) ((Becomes a member of plan 3 if first employed by an employer 10
in an eligible position on or after July 1, 2007, but prior to July 11
1, 2020;12
(b))) Becomes a member of plan 2 ((if first employed by an 13
employer in an eligible position on or after July 1, 2020)); or14
(b) Resumes membership in either plan 2 or plan 3 if membership 15
in either plan was previously established. 16
(2) For administrative efficiency, until a member elects to 17
become a member of plan 3, or becomes a member of plan 3 by default 18
under subsection (1) of this section, the member shall be reported to 19
the department in plan 2, with member and employer contributions. 20
Upon becoming a member of plan 3 by election or by default, all 21
service credit shall be transferred to the member's plan 3 defined 22
benefit, and all employee accumulated contributions shall be 23
transferred to the member's plan 3 defined contribution account.24
(3) If a classified employee is concurrently employed by two or 25
more employers and has chosen membership in a plan, an employee 26
remains an active member of plan 2 or plan 3.27
Sec. 5. RCW 41.40.785 and 2019 c 313 s 3 are each amended to 28
read as follows: 29
(1) All employees who ((first)) become employed by an employer in 30
an eligible position on or after ((March 1, 2002 )) January 1, 2026 , 31
((for state agencies or institutes of higher education, or September 32
1, 2002, for other employers, )) shall have a period of ninety days to 33
make an irrevocable choice for the duration of the employment 34
relationship to become a member of plan 2 or plan 3. At the end of 35
ninety days, if the member has not made a choice ((to become a member 36
of plan 2, )) he or she becomes a member of plan 3 or plan 2 as 37
follows: 38
p. 3 HB 1642
(a) ((Becomes a member of plan 3 if first employed by an employer 1
in an eligible position on or after March 1, 2002, but prior to July 2
1, 2020, for state agencies or institutions of higher education, or 3
on or after September 1, 2002, but prior to July 1, 2020, for other 4
employers;5
(b))) Becomes a member of plan 2 ((if first employed by an 6
employer in an eligible position on or after July 1, 2020)); or7
(b) Resumes membership in either plan 2 or plan 3 if membership 8
in either plan was previously established. 9
(2) For administrative efficiency, until a member elects to 10
become a member of plan 3, or becomes a member of plan 3 by default 11
pursuant to subsection (1) of this section, the member shall be 12
reported to the department in plan 2, with member and employer 13
contributions. Upon becoming a member of plan 3 by election or by 14
default, all service credit shall be transferred to the member's plan 15
3 defined benefit, and all employee accumulated contributions shall 16
be transferred to the member's plan 3 defined contribution account.17
(3) If an employee is concurrently employed by two or more 18
employers and has chosen membership in a plan, the employee remains 19
an active member of plan 2 or plan 3.20
NEW SECTION. Sec. 6. In the event that the state receives a 21
determination letter or other formal guidance from the federal 22
internal revenue service that the provisions of this act conflict 23
with federal law, those provisions are suspended until subsequent 24
federal internal revenue service guidance is received that any 25
conflict with federal law has been resolved.26
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p. 4 HB 1642