HOUSE OF REPRESENTATIVES |
H.B. NO. |
447 |
THIRTY-FIRST LEGISLATURE, 2021 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO EMPLOYEE-UNION HEALTH BENEFITS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds the State's
growing unfunded liabilities of $88,000,000,000 threatens the State's credit
rating and long-term financial sustainability. Of the $88,000,000,000 in unfunded
liabilities, the employer-union health benefits trust fund (EUTF) accounts
for $12,200,000,000.
The
legislature further finds that governor David Ige indefinitely
suspended payment toward paying down the EUTF's unfunded liabilities to address
critical budget shortfalls from the economic impacts of the global COVID-19
pandemic. In response to the governor's
suspension, Moody's Investors Services downgraded the State's credit rating
from Aa1 to Aa2.
While
understanding the suspension is temporary, the State must further commit its
efforts to pursuing responsible fiscal policies to relieve future generations
of the financial burden from the State's unfunded liabilities.
Accordingly,
the purpose of this Act is to reduce the growth of actuarial accrued liability by
limiting employer contributions to premiums for a lower benefit plan for
new hires after June 30, 2021.
SECTION
2. Chapter 87A, Hawaii Revised Statutes,
is amended by adding a new section to be appropriately designated and to read
as follows:
"§87A- State and county contributions; employees hired
after June 30, 2021, and retired. (a) This section shall apply to state and county
contributions to the fund for employees hired after June 30, 2021, and who
retired, except that this section shall not apply to the following employees,
for whom state and county contributions shall be made as provided by section
87A-36:
(1) An employee hired after June 30, 2001, and
prior to July 1, 2021, who transfers employment after June 30, 2021, and who
cumulatively accrues at least ten years of credited service; and
(2) An employee hired after June 30, 2001, and
prior to July 1, 2021, who has at least ten years of credited service prior to
a break in service.
(b) For purposes of this section:
"Break
in service" means to leave state or county employment for more than ninety
calendar days before returning to state or county employment.
"Transfer"
means to leave state or county employment and return to state or county
employment within ninety calendar days.
(c)
The State, through the department of
budget and finance, and the counties, through their respective
departments of finance, shall pay to the fund:
(1) For retired employees based on the self
plan with ten or more years but fewer than fifteen years of service, a monthly
contribution equal to one-half of the base medicare or non-medicare monthly
contribution set forth under section 87A-33(b);
(2) For retired employees based on the self
plan with at least fifteen years but fewer than twenty-five years of service, a
monthly contribution equal to seventy-five per cent of the base medicare or
non-medicare monthly contribution set forth under section 87A-33(b);
(3) For retired employees based on the self
plan with twenty-five or more years of service, a monthly contribution equal to
ninety per cent of the base medicare or non-medicare monthly contribution set
forth under section 87A-33(b); and
(4) One-half of the monthly contributions for
the employee-beneficiary or employee-beneficiary with
dependent-beneficiaries upon the death of the employee; provided that for
purposes of this paragraph, "employee" means those persons who fall within
the definition of "employee" in paragraph (1)(D) of section 87A-1.
If
both spouses are employee-beneficiaries, the total contribution by the
State or county shall not exceed the monthly contribution for two supplemental
medicare self or non-medicare self plans, as appropriate."
SECTION 3. New statutory material is underscored.
SECTION 4. This Act shall take effect on July 1, 2021.
INTRODUCED BY: |
_____________________________ |
Report Title:
EUTF; Health Benefits; State and County Contributions
Description:
Establishes
State and county contributions to the Hawaii employer-union health benefits trust
fund for employees hired after June 30, 2021, with certain exclusions.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.