House Bill 85 would repeal a modified layered amortization funding policy—referred to by proponents as an "ADEC" policy—that was inserted into law in House Bill 569 in the previous session. The repeal would restore earlier employer contribution rates for four public-safety retirement systems and reinstate a statutory appropriation the sponsor says was inadvertently removed from the Department of Justice.

Sponsor Representative Marta Bertoglio told the committee HB 85 would restore funding for the Highway Patrol Officers' Retirement System (HPORS), the Sheriffs' Retirement System (SRS), the Game Warden and Peace Officers Retirement System, and reinstate the Judge’s Retirement System contribution that had been placed on hold. "This bill is a necessary fix to the funding shortfalls created for these systems under the modified layered amortization policy," she said.

Will Hollahan, executive director of the Public Employees Retirement Administration, provided actuarial-based tables to the committee and testified the ADEC approach reduced employer contribution rates and increased unfunded liabilities for multiple systems. He said restoring the FY24 rates would improve amortization periods (for example, improving HPORS from a 24-year amortization to 22 years, SRS from 24 to 20 years and the game warden system from 24 to 14 years) and prevent projected actuarial losses in the next three years.

Dan Villa, executive director of the Board of Investments, and representatives of the Montana Highway Patrol and law enforcement associations (Colonel Kurt Seger, Brian Casey, Jesse Luther, Brian Thompson and others) described recruiting and retention risks tied to an unstable pension system. They urged passage to protect existing one-time appropriations (tens of millions of dollars provided last session) and to avoid a projected $2,000,000 annual budget shortfall for HPORS that Colonel Seger said impaired equipment purchases and staffing.

The Department of Justice’s chief of staff (Will Self) and union and labor representatives (MFPE, Montana AFL-CIO) supported the repeal. The judicial branch’s court administrator, Dave McAlpin, testified as an informational witness that the judiciary’s budget currently lacks the $2.7 million referenced in the bill and the branch was working with the governor’s office regarding funding if the bill passes.

No opponents appeared in the hearing. Committee members questioned whether the repeal would be a permanent fix; proponents said it improved the systems’ actuarial footing but could not guarantee future market or actuarial outcomes. The sponsor closed by stressing the bill would help recruit and retain public-safety personnel and restore fiscal soundness.