Plan 2 board endorses bill to add standby pay to definition of basic salary
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Summary
The board voted to endorse draft legislation to include standby pay in the definition of 'basic salary' for Plan 2; actuaries provided a cost range (updated low 1 basis point, high 4 basis points) and the change is prospective only.
The Law Enforcement Officers' and Fire Fighters' Plan 2 Retirement Board on Dec. 17 endorsed draft legislation that would add standby pay to the statutory definition of "basic salary," aligning Plan 2 with PERS/PSERS treatment.
Staff explained the legislative language mirrors existing PERS/PSERS statutory text and summarized public‑records data collected from employers. Actuarial pricing delivered a range for the potential employee‑rate impact; with new employer data the actuaries continued to estimate a high‑end impact of about 4 basis points and raised the low estimate from 0 to about 1 basis point.
Board members representing employers supported the change as recognition of restrictions and duties members perform while on standby. The motion to endorse the legislation (prospective only, not retroactive) was made, seconded and adopted by voice vote.
Staff noted the actuaries would be asked to produce a more specific fiscal note during the legislative session if a bill is filed, and that administrative costs to update systems were included in initial fiscal estimates.