Retirees, counties and unions urge changes after Ways and Means hearing on LEFT 1 termination and surplus transfers
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Summary
At a lengthy public hearing, staff outlined a plan to terminate LEFT Plan 1 on 06/30/2029 and restart a restated plan funded at 110% of actuarial liability; hundreds of retirees, local officials and unions testified, urging protections for retiree medical benefits, local cost relief, and a benefit enhancement before any surplus is redirected to the general fund or the Climate Commitment Account.
Amanda Cecil, staff to the Senate Ways and Means Committee, briefed the panel on engrossed second substitute House Bill 2,034 (HB 2034), which would terminate and restate LEFT Plan 1 on June 30, 2029. Cecil said LEFT 1 is currently overfunded on the actuarial valuation (160% funded per 2024 valuation) and that the bill would transfer an estimated $569 million to the Climate Commitment Account and roughly $3.4 billion to the pension funding stabilization account or state general fund under current estimates; staff cautioned these are subject to actuarial and market changes.
Members asked detailed questions about historical funding shares, projected medical liabilities and the timing of IRS guidance. Cecil said local governments have ongoing obligations for retiree medical benefits (staff cited roughly $2.0 billion in statewide local government obligations as of the 2024 valuation) and that the IRS review of any termination-recreation package could take at least a year; the bill’s effective date is intended to accommodate that review.
Public testimony was extensive and overwhelmingly opposed to the bill as drafted. Michael Duchemin, president of the Retired Firefighters of Washington, read a written statement opposing the bill “as currently written,” saying, “Under established law, pension funds are supposed to be there for the benefit of the beneficiaries. We do not yet see a benefit in this bill for members.” Joyce Welms of the LEFT 1 Coalition said, “Our LEFT 1 members don't want anything changed. You guys made a promise to them, so why don't you keep it? Do you realize what you're doing is violating the Washington State Constitution?”
Union leaders and retiree organizations pressed the committee to adopt an amendment that would add a benefit enhancement for LEFT Plan members funded from the restarted plan rather than reducing the surplus available for long-term plan stability. Dennis Lawson, president of the Washington State Council of Fire Fighters, said his group has proposed a fiscally separate enhancement that would not reduce the $2.5 billion (staff-cited) referenced in the legislation and would leave the restarted plan with a strong funded level.
Local governments and county associations sought assurances that any transfer of surplus attributable to county contributions should be accompanied by a state assumption of ongoing retiree medical costs or explicit language protecting local interests. Paul Jewell of the Washington State Association of Counties asked the committee to amend the bill to ensure counties are not left paying ongoing medical obligations if surplus is redirected.
Committee next steps
The public hearing closed after extended testimony. Several stakeholders asked the committee either to reject HB 2034 as drafted or to adopt amendments that (1) preserve or dedicate a portion of surplus for local retiree medical liabilities, or (2) include a benefit enhancement for plan 1 members as a precondition for advancing the bill.
Representative statements and witness quotes
- Michael Duchemin, president, Retired Firefighters of Washington: “Under established law, pension funds are supposed to be there for the benefit of the beneficiaries. We do not yet see a benefit in this bill for members.”
- Joyce Welms, LEFT 1 Coalition: “Our LEFT 1 members don't want anything changed. You guys made a promise to them, so why don't you keep it? Do you realize what you're doing is violating the Washington State Constitution?”
- Dennis Lawson, president, Washington State Council of Fire Fighters: “Our proposal is separate and fiscally sound… the funding level would remain strong at approximately 106% and it does not draw from or reduce the $2,500,000,000 referenced in this legislation.”
Context and significance
If enacted, HB 2034 would be a major structural change to an historic pension plan for law enforcement officers and firefighters. The bill’s projected transfers of surplus to other state accounts have raised constitutional, statutory and trust concerns among retirees and local governments. The committee will need to weigh stakeholder requests for benefit enhancements or explicit protections for local obligations before taking further action.
