04/07/2025 01:30 PM House FINANCE

HOUSE BILL NO. 17                                                                                                             
                                                                                                                                
     "An Act  relating to  retirement benefits  and military                                                                    
     service."                                                                                                                  
                                                                                                                                
Co-Chair Foster requested a brief recap of the bill.                                                                            
                                                                                                                                
REPRESENTATIVE  GEORGE RAUSHER,  SPONSOR,  provided a  brief                                                                    
recap of  the bill. He  explained that the bill  was focused                                                                    
on a  very specific group  of veterans who were  totally and                                                                    
permanently  disabled. It  allowed  the  veterans to  access                                                                    
their  accrued  Public  Employee  Retirement  System  (PERS)                                                                    
retirement benefits  without penalty regardless of  age with                                                                    
5 years  of credited  service. The legislation  also allowed                                                                    
military  service, which  had been  purchased in  accordance                                                                    
with  the  PERS standards,  to  count  towards the  credited                                                                    
service requirements for  normal retirement. The legislation                                                                    
did  not   create  new   benefits  but   removed  structural                                                                    
barriers.   He  respectfully   asked  for   the  committee's                                                                    
support.                                                                                                                        
                                                                                                                                
Co-Chair Foster  noted that  Representative Eischied  was in                                                                    
the audience.                                                                                                                   
                                                                                                                                
2:17:30 PM                                                                                                                    
                                                                                                                                
Representative Stapp  related that the committee  received a                                                                    
letter(copy on file) back  from Department of Administration                                                                    
(DOA)  regarding the  bill. He  believed  that it  contained                                                                    
pertinent information and read parts into the record:                                                                           
                                                                                                                                
     In claiming military service  under Alaska Statute (AS)                                                                    
     39.35.340,  the member  would  become  indebted to  the                                                                    
     plan  and the  member is  provided options  for how  to                                                                    
     address their indebtedness. Members  have the option to                                                                    
     pay  their indebtedness  in full  by personal  check, a                                                                    
     pre-tax  transfer   from  an  eligible   account  (i.e.                                                                    
     supplemental  annuity  plan  or  deferred  compensation                                                                    
     plan)  or  enter into  a  salary  reduction program  in                                                                    
     which  a portion  of  their pay  is  directed to  their                                                                    
     indebtedness  every  payroll.   Another  option  is  to                                                                    
     accept  an   actuarial  reduction  at   retirement  for                                                                    
     claiming the service.                                                                                                      
                                                                                                                                
Representative  Stapp   noted  that  the   committee's  main                                                                    
concern  regarded  the stress  on  the  PERS plan,  and  the                                                                    
letter offered  a good explanation  of the mechanics  of the                                                                    
bill.                                                                                                                           
                                                                                                                                
Representative Johnson was trying to figure out the cost to                                                                     
the state.  She asked  for any additional  information other                                                                    
than the fiscal note.                                                                                                           
                                                                                                                                
2:19:21 PM                                                                                                                    
                                                                                                                                
CRAIG   VALDEZ,   STAFF,  REPRESENTATIVE   GEORGE   RAUSHER,                                                                    
answered that there was  no additional information regarding                                                                    
exact costs.                                                                                                                    
                                                                                                                                
Representative Bynum MOVED to REPORT  HB 17 out of committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
notes.                                                                                                                          
                                                                                                                                
HB  17 was  REPORTED out  of  committee with  ten "do  pass"                                                                    
recommendations, and one  "no recommendation" recommendation                                                                    
and one previously published  indeterminate fiscal note: FN1                                                                    
(DOA).                                                                                                                          
                                                                                                                                
2:20:54 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster turned to the next bill on the agenda.