Board declines further action on a narrow benefit-enhancement issue affecting a small group of rehired retirees

The LEOFF Plan 2 Board on July 23 determined no further action was warranted on a narrowly identified issue arising from the 2022 benefit enhancement. Board staff had identified nine members who retired from LEOFF Plan 2, then joined membership in a non-LEOFF retirement plan prior to the board's February 1, 2021 eligibility cutoff for the benefit choice; those members currently appear eligible only for the lump-sum version of the benefit and, in some cases, are unable to collect that lump sum while actively contributing to another retirement plan.

Staff explained the background: the 2022 benefit enhancement gave retirees a choice between a tiered multiplier (for active members on the cutoff date) and a lump-sum payment (for retirees as of that date). Because some LEOFF retirees later became active in other retirement systems, a small subset found themselves categorized as active for the cutoff and therefore limited to the lump-sum option — and under current law cannot receive the lump sum while actively contributing to another state retirement plan.

The board discussed whether to commission a comprehensive briefing that would (a) identify all affected members, (b) estimate interest owed where lump sums remain unpaid, and (c) consider policy options. After discussion, a board member moved for no further action; the motion was seconded and carried by voice vote, and staff will not prepare a comprehensive report at this time. Staff noted that the dataset used to identify nine members was run a month or two prior to the meeting and may change if re-run.