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House amends retirement code language to limit pension ‘spiking’ and updates systems
Summary
Lawmakers approved a first substitute to HB156 to make technical corrections across Utah retirement systems, repeal a rarely used early-retirement buy-down, and exclude salary increases over 10% from the final average salary calculation to curb 'spiking.'
The Utah House adopted a first substitute to House Bill 156 on Feb. 20 after floor amendments and sponsor explanations intended to fix technical inconsistencies across multiple state retirement systems.
Representative Christine Bodley, sponsor of the substitute, described the package as largely a housekeeping measure that aligns provisions across the several retirement systems administered by the state. She said the bill corrects omissions in code and standardizes final-average-salary calculations.
Key substantive changes include an exclusion intended to limit ‘‘spiking’’ of a retiree’s final average salary: salary increases over 10% will not be fully counted in the final average salary used to calculate retirement benefits. The amendment also repeals an early-retirement buy-down provision that, while previously enacted, had not been used in practice.
Bodley said the retirement office is a quasi-independent agency and these changes clarify the legislature’s role in reviewing but not approving the agency’s operating budget. Floor amendments on pink sheets were adopted to address omitted code sections and to harmonize the computation of average salary across systems. The House recorded the substitute’s passage and sent the bill to the Senate.
