State of Alaska
Fiscal Note
Bill Version: CSHB 79(FIN)
2020 Legislative Session
Fiscal Note Number: 2
(H) Publish Date: 3/18/2020
Identifier: HB079-DOA-DRB-3-3-20 Department: State Retirement Payments
Title: PEACE OFFICER/FIREFIGHTER RETIRE Appropriation: PERS State Assistance
BENEFITS Allocation: All Other PERS
Sponsor: KOPP OMB Component Number: 2866
Requester: (H) Finance
Expenditures/Revenues
Note: Amounts do not include inflation unless otherwise noted below. (Thousands of Dollars)
Included in
FY2021 Governor's
Appropriation FY2021 Out-Year Cost Estimates
Requested Request
OPERATING EXPENDITURES FY 2021 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026
Personal Services
Travel
Services
Commodities
Capital Outlay
Grants & Benefits
Miscellaneous 3,500.0 3,600.0 3,300.0 4,000.0 4,100.0
Total Operating 0.0 0.0 3,500.0 3,600.0 3,300.0 4,000.0 4,100.0
Fund Source (Operating Only)
1004 Gen Fund (UGF) 3,500.0 3,600.0 3,300.0 4,000.0 4,100.0
Total 0.0 0.0 3,500.0 3,600.0 3,300.0 4,000.0 4,100.0
Positions
Full-time
Part-time
Temporary
Change in Revenues
None
Total 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Estimated SUPPLEMENTAL (FY2020) cost: 0.0 (separate supplemental appropriation required)
Estimated CAPITAL (FY2021) cost: 0.0 (separate capital appropriation required)
Does the bill create or modify a new fund or account? Yes
(Supplemental/Capital/New Fund - discuss reasons and fund source(s) in analysis section)
ASSOCIATED REGULATIONS
Does the bill direct, or will the bill result in, regulation changes adopted by your agency? No
If yes, by what date are the regulations to be adopted, amended or repealed?
Why this fiscal note differs from previous version/comments:
Not applicable. Initial version.
Prepared By: Ajay Desai, Director Phone: (907)465-4471
Division: Retirement and Benefits Date: 03/03/2020
Approved By: Brad Ewing, Administrative Services Director Date:
OUT OF
03/03/20
Agency: Office of Management and Budget REPORTED
Printed 3/18/2020 Page 1 of 2 HFC 03/18/2 020
Control Code: EXXZL
 CSHB 79(FIN) - Fiscal Note 2
FISCAL NOTE ANALYSIS
STATE OF ALASKA BILL NO. HB 79
2020 LEGISLATIVE SESSION
Analysis
This bill proposes to open the Public Employees' Retirement System (PERS) Defined Benefit Plan (DB) by adding a new
benefit tier or plan for peace officers and firefighters (P/F). New employees will be enrolled into the defined benefit plan
and existing PERS P/F Defined Contribution Retirement (DCR) members will be allowed an opportunity to convert to the
new defined benefit tier or plan.
The PERS system consulting actuary, BUCK Global LLC (Buck), has calculated the financial effects if this bill should pass as
written. The basic result is that there will be an increase to the PERS additional state contribution because a smaller
portion of the 22% employer contribution for the P/F members will be deposited to the defined benefit trust than is
currently deposited with the defined contribution distribution of funding. Since this bill would take effect on July 1, 2021,
there is no financial impact to Fiscal Year 2021. If future experience matches the actuarial assumptions used to value the
plan's liabilities, the dollar increase on the PERS additional state contribution is reflected below:
Year FY2022 FY2023 FY2024 FY2025 FY2026
Dollars (in thousands) $3,500 $3,600 $3,300 $4,000 $4,100
Projected PERS additional state contributions beyond FY2026 are also expected to increase.
See attached letter from Buck dated February 29, 2020. As noted in Item A. on page 1 of the letter, "It is important to
recognize that by shifting active P/F members (and all future P/F hires) from DCR to DB, the State will be taking on greater
risk of higher [additional state] contributions in future years. However, this risk is somewhat mitigated as long as the
minimum contribution rate to the HB 79G trust (9%) is greater than the actuarially determined contribution rate for HB
79G members."
While the fiscal note letter from Buck references version G, this fiscal analysis also applies to version O. Version O was
requested to be a finance committee substitute, but there are no differences between versions G and O.
(Revised 10/22/19 OMB/LFD) Page 2 of 2
HB079-DOA-DRB-3-3-20 Page 2 of 2 Control Code: EXXZL


Statutes affected:
HB0079A, AM HB 79, introduced 03/06/2019: 37.10.220, 37.10.210, 37.10.390, 14.25.340, 14.25.350, 39.30.150, 39.30.180, 39.35.730, 39.35.750, 39.45.010, 39.45.060, 14.25.145, 39.35.100, 39.30.300, 39.30.495, 39.35.160, 14.25.009, 14.25.220, 39.35.095, 39.35.680, 37.10.310, 39.35.257, 40.25.110, 40.25.120, 39.35.475, 39.30.090, 14.25.168, 14.25.480, 22.25.090, 39.35.535, 39.35.537, 39.35.880, 39.37.145, 23.15.136, 39.30.091, 21.86.310, 14.25.110, 23.15.010, 23.15.210, 39.30.097, U.S.C, 14.25.310, 14.25.590, 39.35.700, 39.35.990, 39.30.380, 14.25.470, 39.35.870, 39.30.390, 39.30.400, 39.35.255, 39.35.282, 39.35.280, 39.30.340, 39.35.370, 39.35.450, 39.35.381, 39.35.400, 39.35.440, 39.35.485, 39.35.480, 39.35.360, 39.30.095, 39.35.300, 39.35.310, 39.35.385, 39.35.720, 39.35.115, 39.35.678, 39.35.710, 39.35.895, 39.35.003
HB0079B, AM CSHB 79(FIN), introduced 03/18/2020: 37.10.220, 37.10.210, 37.10.390, 14.25.340, 14.25.350, 39.30.150, 39.30.180, 39.35.730, 39.35.750, 39.45.010, 39.45.060, 14.25.145, 39.35.100, 39.30.300, 39.30.495, 39.35.160, 14.25.009, 14.25.220, 39.35.095, 39.35.680, 39.35.255, 37.10.310, 40.25.110, 40.25.120, 39.35.475, 39.30.090, 14.25.168, 14.25.480, 22.25.090, 39.35.535, 39.35.537, 39.35.880, 39.37.145, 23.15.136, 39.30.091, 21.86.310, 14.25.110, 23.15.010, 23.15.210, 39.30.097, U.S.C, 14.25.310, 14.25.590, 39.35.700, 39.35.990, 39.30.380, 14.25.470, 39.35.870, 39.30.390, 39.30.400, 39.35.520, 39.30.370, 39.35.150, 39.35.282, 39.35.280, 39.30.340, 39.35.370, 39.35.450, 39.35.381, 39.35.400, 39.35.440, 39.35.485, 39.35.480, 39.35.360, 39.30.095, 39.35.300, 39.35.310, 39.35.385, 39.35.720, 39.35.115, 39.35.678, 39.35.710, 39.35.895, 39.35.003