Plan 1 COLA Bill Passes House
On Wednesday, March 1, the Washington State House of Representatives passed Engrossed Substitute House Bill (ESHB) 1057 to grant PERS 1 and TRS 1 retirees a one-time 3% cost of living adjustment (COLA) in 2023 not to exceed $110 per month.
Rep. Drew Stokesbary (R, Auburn), the bill’s primary sponsor, spoke to Plan 1 retiree’s great need for a COLA due to inflation and said he hoped that the legislature could find a way to help those in need on “more than just a one year at a time basis”. Rep. Steve Bergquist (D, Renton) also spoke in support of the bill.
The bill passed unanimously after a technical amendment was adopted on the floor. It will now be delivered to the Senate.
On Monday, February 27, the Senate passed Senate Bill 5350, the companion bill to ESHB 1057. The two bills differ because the House Appropriations Committee adopted an amendment to have the 2023 COLA financed not through a specific appropriation, but through funds already allocated to Plan 1. Additionally, the amendment delays the payment of ongoing funds for the one-time Plan 1 COLAs granted in 2018, 2020, and 2022.
While both chambers have now shown a commitment to providing Plan 1 retirees with a one-time COLA in 2023, they will need to reach an agreement on how the COLA will be funded.
PERS 1 and TRS 1 are the only pension plans administered by the Department of Retirement Systems that do not receive automatic COLAs. Plans 2 and 3 members receive automatic COLAs of up to 3% every July based on inflation. If inflation exceeds 3%, the excess amount is “banked” and used the next year inflation is below 3%.