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Bill would pay full monthly pension in month a retiree dies to avoid clawbacks from survivors
Summary
Senate Bill 5114 would require the Department of Retirement Systems to pay a retiree’s full monthly pension for the month in which the retiree dies, rather than billing estates for prorated amounts; testimony described nominal administrative costs and cited cases where survivors were billed after a death.
Senate Bill 5114, presented to the Senate Ways & Means Committee at the request of the Select Committee on Pension Policy, would change how DRS handles pension payments in the month of a retiree’s death. Under current practice, DRS pays benefits through the date of death and, if a full monthly payment already was processed, DRS bills the estate for the portion after the date of death. The bill would pay the retiree’s full monthly pension in the month they die.
Amanda Cecil briefed the committee that DRS’s actuarial fiscal note projects an additional near‑general‑fund cost of $13.2 million in the 2025‑27 biennium and $26.6 million over a four‑year outlook, with a 25‑year near‑general‑fund cost of $125.4 million and $274.7 million across all employers. Administrative costs were estimated at $279,000.
Supporters described the bill as a humane change that avoids placing survivors in the position of having to repay portions of a pension during an emotionally difficult time. Eileen Perferman, a Plan 1 retiree representing the Washington State School Retirees Association, described receiving notice after her husband’s death that the estate owed money because he did not die on the final day of the month. Nancy Healy, executive board member of the Retired Public Employees Council of Washington, told the committee the bill would prevent survivors from having to return pension funds needed for end‑of‑life arrangements.
Ending: The committee took public testimony in favor of SB 5114; no committee vote occurred in the hearing.
