Legislation Implementation Update
Earlier this year, you helped the Washington State Legislature pass bills that positively impact retired public employees and senior citizens across the state. RPEC is monitoring how these new laws are being implemented by state agencies. Here is an update on some of the most important bills that the Legislature passed in 2023:
SHB 1355: Expanding Senior Property Tax Exemption Thresholds
Substitute House Bill 1355 addressed the housing affordability crisis that many retirees face by raising property tax exemption thresholds for people over the age of 61 as well as those who are unable to work due to a disability. There are three income thresholds that provide different levels of tax relief. The Legislature increased the thresholds to the following levels:
- Income threshold one: the greater of $30,000 or 50 percent of the county median household income.
- Income threshold two: the greater of $35,000 or 60 percent of the county median household income.
- Income threshold three: the greater of $40,000 or 70 percent of the county median household income.
You can determine your county’s property tax thresholds by contacting your county assessor. The increased thresholds will come into effect in 2024. Your county might not have information about the 2024 thresholds until September 2023. In January or February 2024, property owners will receive notice of their property taxes due at the end of April. As soon as property owners complete their 1040 individual income tax form, they should contact their county accessor’s office to apply for the property tax exemption. More information about SHB 1355 can be found here.
SB 5490: Allowing Some Retirees to Rejoin PEBB
Senate Bill 5490 impacts retired or disabled employees who were previously denied coverage from the Public Employees Benefits Board (PEBB) solely for failure to timely notify the Health Care Authority (HCA) of their intent to defer coverage. Individuals may reapply to enroll in medical and dental plans if they meet the following eligibility criteria:
- You are receiving a retirement allowance under the Teachers’ Retirement System (TRS), School Employees’ Retirement System (SERS), Public Safety Employees’ Retirement System (PSERS), or the Public Employees’ Retirement System (PERS).
- You have been denied health care coverage solely for failure to timely notify HCA of your plan to defer coverage.
- You have appealed the denial of benefits to HCA on or before December 31, 2022.
- You are Medicare eligible.
The new law came into effect on March 30, 2023 and at least one RPEC member has already successfully enrolled in a PEBB plan. Applicants must complete paperwork by November 30, 2023. Due to a provision in the law, retirees who re-enroll will not be allowed to join Uniform Medical Plan (UMP) Classic Medicare.
HCA is identifying individuals who might qualify and contacting them via mail to notify them of their eligibility. Don’t wait to receive a letter in the mail. Click here if you think you might be eligible.
SHB 1804: Protecting Non-State Retirees Enrolled in PEBB Plans
Substitute House Bill 1804 impacts retirees who belong to PEBB and did not retire from Washington State. If their former employer (likely a city, county, PUD, or local government) decides to terminate its contract with PEBB, the employer’s former employees now have the option of remaining in PEBB. However, impacted retirees will not receive the employer provided premium subsidy of 50% not to exceed $183 per month.
The new law took effect on May 4, 2023. Retirees of employers that ended their participation with PEBB prior to January 1, 2023 have until December 31, 2023 to enroll in PEBB plans. Click here to learn more.
SB 5350: COLA for PERS 1 and TRS 1 Retirees
Senate Bill 5350 provides PERS 1 and TRS 1 retirees with a one-time cost-of-living adjustment (COLA) of 3%, not to exceed $110 per month. PERS 1 and TRS 1 retirees will receive the increase on their July pension payments which are transmitted on the last business day of the month.
An additional provision of SB 5350 requires the Select Committee on Pension Policy (SCPP) to study and recommend a proposal for an ongoing COLA for PERS 1 and TRS 1 retirees to the full legislature. The SCPP will begin to study the issue at their July 18 meeting. RPEC will be heavily involved in the crafting of the SCPP’s COLA proposal.
COLAs for PERS 2, PERS 3, SERS 2, SERS 3, TRS 2, TRS 3, and PSERS 2
All retirees in the above plans who retired prior to July 2, 2022, will receive a COLA of 3% with their pension payment on the last business day of July 2023. 5.81% will be banked for future use in years where inflation falls below 3%. Click here to learn more about COLA banking.