CERTIFICATION OF ENROLLMENT
SENATE BILL 5021
Chapter 12, Laws of 2021
67th Legislature
2021 Regular Session
PUBLIC EMPLOYEE RETIREMENT BENEFITS--EFFECT OF EXPENDITURE REDUCTIONS
EFFECTIVE DATE: July 25, 2021
Passed by the Senate February 23, CERTIFICATE
2021
Yeas 29 Nays 20 I, Brad Hendrickson, Secretary of
the Senate of the State of
Washington, do hereby certify that
DENNY HECK the attached is SENATE BILL 5021 as
President of the Senate passed by the Senate and the House
of Representatives on the dates
hereon set forth.
Passed by the House March 24, 2021
Yeas 65 Nays 32 BRAD HENDRICKSON
Secretary
LAURIE JINKINS
Speaker of the House of
Representatives
Approved April 7, 2021 3:38 PM FILED
April 7, 2021
Secretary of State
JAY INSLEE State of Washington
Governor of the State of Washington
 SENATE BILL 5021
Passed Legislature - 2021 Regular Session
State of Washington 67th Legislature 2021 Regular Session
By Senators Hunt, Conway, Saldaña, and Wilson, C.; by request of
Department of Retirement Systems
Prefiled 12/17/20. Read first time 01/11/21. Referred to Committee
on Ways & Means.
1 AN ACT Relating to the effect of expenditure reduction efforts on
2 retirement benefits for public employees, including those
3 participating in the shared work program; amending RCW 41.26.030,
4 41.32.010, 41.34.040, 41.35.010, 41.37.010, 41.40.010, and 43.43.120;
5 adding a new section to chapter 41.50 RCW; and creating a new
6 section.
7 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
8 NEW SECTION. Sec. 1. It is the intent of the legislature that
9 this act be curative, remedial, and retroactively applied.
10 Sec. 2. RCW 41.26.030 and 2020 c 107 s 6 are each amended to
11 read as follows:
12 As used in this chapter, unless a different meaning is plainly
13 required by the context:
14 (1) "Accumulated contributions" means the employee's
15 contributions made by a member, including any amount paid under RCW
16 41.50.165(2), plus accrued interest credited thereon.
17 (2) "Actuarial reserve" means a method of financing a pension or
18 retirement plan wherein reserves are accumulated as the liabilities
19 for benefit payments are incurred in order that sufficient funds will
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 1 be available on the date of retirement of each member to pay the
2 member's future benefits during the period of retirement.
3 (3) "Actuarial valuation" means a mathematical determination of
4 the financial condition of a retirement plan. It includes the
5 computation of the present monetary value of benefits payable to
6 present members, and the present monetary value of future employer
7 and employee contributions, giving effect to mortality among active
8 and retired members and also to the rates of disability, retirement,
9 withdrawal from service, salary and interest earned on investments.
10 (4)(a) "Basic salary" for plan 1 members, means the basic monthly
11 rate of salary or wages, including longevity pay but not including
12 overtime earnings or special salary or wages, upon which pension or
13 retirement benefits will be computed and upon which employer
14 contributions and salary deductions will be based.
15 (b) "Basic salary" for plan 2 members, means salaries or wages
16 earned by a member during a payroll period for personal services,
17 including overtime payments, and shall include wages and salaries
18 deferred under provisions established pursuant to sections 403(b),
19 414(h), and 457 of the United States Internal Revenue Code, but shall
20 exclude lump sum payments for deferred annual sick leave, unused
21 accumulated vacation, unused accumulated annual leave, or any form of
22 severance pay. In any year in which a member serves in the
23 legislature the member shall have the option of having such member's
24 basic salary be the greater of:
25 (i) The basic salary the member would have received had such
26 member not served in the legislature; or
27 (ii) Such member's actual basic salary received for
28 nonlegislative public employment and legislative service combined.
29 Any additional contributions to the retirement system required
30 because basic salary under (b)(i) of this subsection is greater than
31 basic salary under (b)(ii) of this subsection shall be paid by the
32 member for both member and employer contributions.
33 (5)(a) "Beneficiary" for plan 1 members, means any person in
34 receipt of a retirement allowance, disability allowance, death
35 benefit, or any other benefit described herein.
36 (b) "Beneficiary" for plan 2 members, means any person in receipt
37 of a retirement allowance or other benefit provided by this chapter
38 resulting from service rendered to an employer by another person.
39 (6)(a) "Child" or "children" means an unmarried person who is
40 under the age of eighteen or mentally or physically disabled as
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 1 determined by the department, except a person who is disabled and in
2 the full time care of a state institution, who is:
3 (i) A natural born child;
4 (ii) A stepchild where that relationship was in existence prior
5 to the date benefits are payable under this chapter;
6 (iii) A posthumous child;
7 (iv) A child legally adopted or made a legal ward of a member
8 prior to the date benefits are payable under this chapter; or
9 (v) An illegitimate child legitimized prior to the date any
10 benefits are payable under this chapter.
11 (b) A person shall also be deemed to be a child up to and
12 including the age of twenty years and eleven months while attending
13 any high school, college, or vocational or other educational
14 institution accredited, licensed, or approved by the state, in which
15 it is located, including the summer vacation months and all other
16 normal and regular vacation periods at the particular educational
17 institution after which the child returns to school.
18 (7) "Department" means the department of retirement systems
19 created in chapter 41.50 RCW.
20 (8) "Director" means the director of the department.
21 (9) "Disability board" for plan 1 members means either the county
22 disability board or the city disability board established in RCW
23 41.26.110.
24 (10) "Disability leave" means the period of six months or any
25 portion thereof during which a member is on leave at an allowance
26 equal to the member's full salary prior to the commencement of
27 disability retirement. The definition contained in this subsection
28 shall apply only to plan 1 members.
29 (11) "Disability retirement" for plan 1 members, means the period
30 following termination of a member's disability leave, during which
31 the member is in receipt of a disability retirement allowance.
32 (12) "Domestic partners" means two adults who have registered as
33 domestic partners under RCW 26.60.020.
34 (13) "Employee" means any law enforcement officer or firefighter
35 as defined in subsections (17) and (19) of this section.
36 (14)(a) "Employer" for plan 1 members, means the legislative
37 authority of any city, town, county, district, or regional fire
38 protection service authority or the elected officials of any
39 municipal corporation that employs any law enforcement officer and/or
40 firefighter, any authorized association of such municipalities, and,
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 1 except for the purposes of RCW 41.26.150, any labor guild,
2 association, or organization, which represents the firefighters or
3 law enforcement officers of at least seven cities of over 20,000
4 population and the membership of each local lodge or division of
5 which is composed of at least sixty percent law enforcement officers
6 or firefighters as defined in this chapter.
7 (b) "Employer" for plan 2 members, means the following entities
8 to the extent that the entity employs any law enforcement officer
9 and/or firefighter:
10 (i) The legislative authority of any city, town, county,
11 district, public corporation, or regional fire protection service
12 authority established under RCW 35.21.730 to provide emergency
13 medical services as defined in RCW 18.73.030;
14 (ii) The elected officials of any municipal corporation;
15 (iii) The governing body of any other general authority law
16 enforcement agency;
17 (iv) A four-year institution of higher education having a fully
18 operational fire department as of January 1, 1996; or
19 (v) The department of social and health services or the
20 department of corrections when employing firefighters serving at a
21 prison or civil commitment center on an island.
22 (c) Except as otherwise specifically provided in this chapter,
23 "employer" does not include a government contractor. For purposes of
24 this subsection, a "government contractor" is any entity, including a
25 partnership, limited liability company, for-profit or nonprofit
26 corporation, or person, that provides services pursuant to a contract
27 with an "employer." The determination whether an employer-employee
28 relationship has been established is not based on the relationship
29 between a government contractor and an "employer," but is based
30 solely on the relationship between a government contractor's employee
31 and an "employer" under this chapter.
32 (15)(a) "Final average salary" for plan 1 members, means (i) for
33 a member holding the same position or rank for a minimum of twelve
34 months preceding the date of retirement, the basic salary attached to
35 such same position or rank at time of retirement; (ii) for any other
36 member, including a civil service member who has not served a minimum
37 of twelve months in the same position or rank preceding the date of
38 retirement, the average of the greatest basic salaries payable to
39 such member during any consecutive twenty-four month period within
40 such member's last ten years of service for which service credit is
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 1 allowed, computed by dividing the total basic salaries payable to
2 such member during the selected twenty-four month period by twenty-
3 four; (iii) in the case of disability of any member, the basic salary
4 payable to such member at the time of disability retirement; (iv) in
5 the case of a member who hereafter vests pursuant to RCW 41.26.090,
6 the basic salary payable to such member at the time of vesting.
7 (b) "Final average salary" for plan 2 members, means the monthly
8 average of the member's basic salary for the highest consecutive
9 sixty service credit months of service prior to such member's
10 retirement, termination, or death. Periods constituting authorized
11 unpaid leaves of absence may not be used in the calculation of final
12 average salary.
13 (c) In calculating final average salary under (a) or (b) of this
14 subsection, the department of retirement systems shall include:
15 (i) Any compensation forgone by a member employed by a state
16 agency or institution during the 2009-2011 fiscal biennium as a
17 result of reduced work hours, mandatory or voluntary leave without
18 pay, temporary reduction in pay implemented prior to December 11,
19 2010, or temporary layoffs if the reduced compensation is an integral
20 part of the employer's expenditure reduction efforts, as certified by
21 the employer; ((and))
22 (ii) Any compensation forgone by a member employed by the state
23 or a local government employer during the 2011-2013 fiscal biennium
24 as a result of reduced work hours, mandatory leave without pay,
25 temporary layoffs, or reductions to current pay if the reduced
26 compensation is an integral part of the employer's expenditure
27 reduction efforts, as certified by the employer. Reductions to
28 current pay shall not include elimination of previously agreed upon
29 future salary increases; and
30 (iii) Any compensation forgone by a member employed by the state
31 or a local government employer during the 2019-2021 and 2021-2023
32 fiscal biennia as a result of reduced work hours, mandatory leave
33 without pay, temporary layoffs, furloughs, reductions to current pay,
34 or other similar measures resulting from the COVID-19 budgetary
35 crisis, if the reduced compensation is an integral part of the
36 employer's expenditure reduction efforts, as certified by the
37 employer. Reductions to current pay shall not include elimination of
38 previously agreed upon future salary increases.
39 (16) "Fire department" includes a fire station operated by the
40 department of social and health services or the department of
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 1 corrections when employing firefighters serving a prison or civil
2 commitment center on an island.
3 (17) "Firefighter" means:
4 (a) Any person who is serving on a full time, fully compensated
5 basis as a member of a fire department of an employer and who is
6 serving in a position which requires passing a civil service
7 examination for firefighter, and who is actively employed as such;
8 (b) Anyone who is actively employed as a full time firefighter
9 where the fire department does not have a civil service examination;
10 (c) Supervisory firefighter personnel;
11 (d) Any full time executive secretary of an association of fire
12 protection districts authorized under RCW 52.12.031. The provisions
13 of this subsection (17)(d) shall not apply to plan 2 members;
14 (e) The executive secretary of a labor guild, association or
15 organization (which is an employer under subsection (14) of this
16 section), if such individual has five years previous membership in a
17 retirement system established in chapter 41.16 or 41.18 RCW. The
18 provisions of this subsection (17)(e) shall not apply to plan 2
19 members;
20 (f) Any person who is serving on a full time, fully compensated
21 basis for an employer, as a fire dispatcher, in a department in
22 which, on March 1, 1970, a dispatcher was required to have passed a
23 civil service examination for firefighter;
24 (g) Any person who on March 1, 1970, was employed on a full time,
25 fully compensated basis by an employer, and who on May 21, 1971, was
26 making retirement contributions under the provisions of chapter 41.16
27 or 41.18 RCW; and
28 (h) Any person who is employed on a full-time, fully compensated
29 basis by an employer as an emergency medical technician that meets
30 the requirements of RCW 18.71.200 or 18.73.030(12), and whose duties
31 include providing emergency medical services as defined in RCW
32 18.73.030.
33 (18) "General authority law enforcement agency" means any agency,
34 department, or division of a municipal corporation, political
35 subdivision, or other unit of local government of this state, and any
36 agency, department, or division of state government, having as its
37 primary function the detection and apprehension of persons committing
38 infractions or violating the traffic or criminal laws in general, but
39 not including the Washington state patrol. Such an agency,
40 department, or division is distinguished from a limited authority law
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 1 enforcement agency having as one of its functions the apprehension or
2 detection of persons committing infractions or violating the traffic
3 or criminal laws relating to limited subject areas, including but not
4 limited to, the state departments of natural resources and social and
5 health services, the state gambling commission, the state lottery
6 commission, the state parks and recreation commission, the state
7 utilities and transportation commission, the state liquor and
8 cannabis board, and the state department of corrections. A general
9 authority law enforcement agency under this chapter does not include
10 a government contractor.
11 (19) "Law enforcement officer" beginning January 1, 1994, means
12 any person who is commissioned and employed by an employer on a full
13 time, fully compensated basis to enforce the criminal laws of the
14 state of Washington generally, with the following qualifications:
15 (a) No person who is serving in a position that is basically
16 clerical or secretarial in nature, and who is not commissioned shall
17 be considered a law enforcement officer;
18 (b) Only those deputy sheriffs, including those serving under a
19 different title pursuant to county charter, who have successfully
20 completed a civil service examination for deputy sheriff or the
21 equivalent position, where a different title is used, and those
22 persons serving in unclassified positions autho