State retirement plans-adjustments.

22LSO-0340
2022
STATE OF WYOMING
22LSO-0340
Numbered
2.0

HOUSE BILL NO. HB0111

State retirement plans-adjustments.

Sponsored by: Representative(s) Henderson, Barlow, Harshman, Olsen and Sweeney and Senator(s) Pappas

A BILL

for

AN ACT relating to retirement benefits administered by the Wyoming retirement system; providing for two, single noncumulative benefit payments under the Wyoming Retirement Act, the Wyoming State Highway Patrol, Game and Fish Warden and Criminal Investigator Retirement Act and the Firemen's Pension Account Reform Act of 1981; providing an appropriation; specifying legislative intent and making legislative findings; requiring a study, reports and certifications; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1
.

(a)

It is the intent of the legislature to:

(i)

Provide two (2) single benefit payments to retirees within specified Wyoming public employee retirement
plans;

(ii)

Review public employee retirement plans to determine if adjustments for inflation to retiree benefit payments can be made while
still keeping
the plans actuarially sound.

(b)

The legislature finds:

(i)

Wyoming public employee retirement plans have existed since as early as 1927. Cost-of-living or other benefit adjustments have been made in various public employee retirement plans on an ongoing basis since as early as
1953;

(ii)

2012 Wyoming Session Laws, Chapter 107, made significant modifications to cost-of-living and other
benefit increases in public employee retirement plans. While finding that the actuarial funding levels of the Wyoming plans were higher than many public employee
retirement
plans in other states, the legislature found that "as constructed by statute, the Wyoming plans were not intended to and cannot support cost-of-living or other benefit increases;"

(iii)

The 2012 enactment removed the authority of the Wyoming retirement board to provide cost-of-living adjustments and placed further restrictions on cost-of-living adjustments. Since the 2012 enactment, no cost-of-living adjustments or other benefit increases have been made under any of the plans subject to the restrictions imposed by that
enactment;

(iv)

For the largest retirement plan, Wyoming law has provided, since the initiation of that plan in 1949, that the enactment of the plan shall not constitute a contract or create other rights other than to receive a return of contributions upon withdrawal. The recreated act in 1953 reiterated that no contract was created and
provided that the state was not incurring any future obligation or liability other than to make the employer contributions specified. Those provisions have remained through the current day. However, the legislature is authorized to make appropriations to satisfy moral obligations of the state.
State v. Carter
, 215 P. 477 (Wyo. 1923). Payment under these retirement
plans
and this act is not a gift to the employee but is at least in part a recognition of a moral and equitable obligation of the state to its former employees;

(v)

While stability of retirement plans is critical, fair treatment of public employees is also important
in order to
employ and retain dedicated employees, as recognized by past legislative actions.

Section 2.

(a)

The Wyoming retirement board shall review the findings underlying the enactment of 2012 Wyoming Session Laws, Chapter
107
and report to the joint appropriations committee:

(i)

Subsequent legislative and board actions that affect the findings of the 2012
enactment;

(ii)

The effect of inflation on retirees since the last benefit adjustments were provided to retirees in each public employee retirement
plan;

(iii)

Eligibility of retirees under each of the plans for social security benefits and the effect that eligibility for social security benefits:

(A)

Was and is considered in establishing a plan's benefits, contribution rates and pay provisions for active
employees;

(B)

Has in offsetting benefit purchasing power reduced
as a result of
inflation.

(iv)

Existing and projected funding ratios for each retirement plan, under current law and under any
recommended benefit, contribution or other adjustment for each
plan;

(v)

An explanation of each plan, providing:

(A)

The contribution rates by employer and employee and identifying mandated employee "out-of-pocket"
contributions;

(B)

An explanation of eligibility requirements for normal and early retirement and disability benefits and how benefits are
calculated;

(C)

Annual benefits
paid;

(D)

Historical changes to each plan; and

(E)

Number of active,
inactive
and retired participants under each plan.

(vi)

Amounts needed to fund each plan at an actuarial funded ratio of one hundred percent (100%) at the
time of the report and at a thirty (30) year projection, and benefit adjustments that would reach these ratios without additional increases in funding that are not currently provided in
law;

(vii)

Recommended modifications to law to provide conditions under which any benefit adjustment may be authorized, including:

(A)

Recommended actuarial funded
ratios;

(B)

An index by which to measure true cost increases or decreases for
retirees;

(C)

Minimum and maximum adjustments over specified periods and the immediate and projected cost of the adjustments.

(viii)

Any additional relevant information or recommendations the board deems necessary or appropriate.

(b)

At the request of the Wyoming retirement board, the volunteer firefighter, EMT and search and rescue pension board shall assist and provide any information necessary to complete the report required under subsection (a) of this section.

(c)

The report required by this section shall be submitted not later than September 1, 2022.

(d)

The joint appropriations committee shall consider the recommendations of the Wyoming retirement board and may develop legislation as the committee determines appropriate for introduction in the 2023 general session.

Section 3.

As used in sections 1 and 2 of this
act
"public employee retirement plan" or "retirement plan" includes all plans administered by the Wyoming retirement board, the volunteer firefighter, EMT and search and rescue pension plan administered by the volunteer firefighter, EMT and search and rescue pension board under W.S. 35-9-616 through 35-9-628 and the paid firemen plan A administered
by the Wyoming retirement board under W.S. 15-5-201 through 15-5-209.

Section 4.

Two (2), single, additional payments shall be made, one (1) on or before July 1, 2022, and one (1) on or before July 1, 2023, to each eligible person receiving a service pension, survivor's pension, retirement benefit, survivor benefit, death benefit or disability pension or benefit under the Wyoming Retirement Act, the Wyoming State Highway Patrol, Game and Fish Warden and Criminal Investigator Retirement Act or the Firemen's Pension Account Reform Act of 1981 as provided in this section. The additional payments shall be limited to persons who first began receiving the applicable benefit or pension payment prior to July 1, 2021, either alone or in combination with a member or retired or disabled employee if the person is a survivor. If the person is a survivor, the applicable benefit date for the benefit or pension payment shall be based on the initial retirement or disability benefit of the pertinent member. Each additional payment to an eligible person shall be calculated by multiplying the eligible person's existing annual benefit by one-tenth of
one percent (0.1%) for each year his retirement or disability benefit was effective prior to July 1, 2021, or if the person is a survivor for each year the pertinent member's or employee's benefit was effective prior to July 1, 2021, up to a maximum amount of three percent (3%) of the existing annual benefit. The two (2) payments under this section shall not be ongoing or cumulative.

Section 5.

For the two (2) payments required under section 4 of this act, there is appropriated twelve million six hundred sixty-five thousand seven hundred eight dollars ($12,665,708.00) from the legislative stabilization reserve account to the Wyoming retirement board. This appropriation shall not be transferred or expended for any other purpose and any unexpended, unobligated funds remaining from this appropriation shall revert as provided by law on June 30, 2024.

Section 6.

This act is effective immediately upon completion of all acts necessary for a bill to become law as provided by Article 4, Section 8 of the Wyoming Constitution.
(END)

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HB0111