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Agency 124
Department of Retirement Systems
RCW 41.50

Request

$37,148,094

Net change from current biennium

$2,317,891

Increase

Percent change from current biennium

6.7%

Increase

The Department of Retirement Systems is responsible for the general administration of the Public Employees' Retirement System (PERS), the Teachers' Retirement System (TRS), the Law Enforcement Officers' and Fire Fighters' Retirement System (LEOFF), the Washington State Patrol Retirement System, the Judicial Retirement System, and the Judges' Retirement Fund. The Department is also responsible for the administration of the Deferred Compensation and Dependent Care Assistance programs and for investing the monies of the Judicial Retirement Account. Activities include membership services, benefit administration services, retirement counseling, retirement information services, trust fund benefit administration, accounting and financial services, and human resource and retirement policy administration services. The Department also manages a program that allows state employees to defer a portion of their earnings until retirement or termination of state employment and to allow eligible employees to set aside a before-tax portion of their compensation for reimbursement of their dependent care expenses.

The goal of the Department is to administer the retirement trusts, deferred compensation program, and dependent care salary reduction program consistent with the highest standard of fiduciary responsibility, while providing responsive, high-quality service.

Agency Level Summary

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Operating Budget: Summary
1995-97 Appropriations								Appropriated Funds							Expenditures
	Amount		Estimated Balance											1993-95 Actual			1995-97 Estimated		1997-99 Proposed
356,374				1,285				Dependent Care Administrative Acct - State							333,342			355,089		357,087
31,658,018				116,930				Dept of Retirement Systems Expense - State							31,520,106			31,541,088		33,830,215
32,014,392				118,215				Total Appropriated Funds							31,853,448			31,896,177		34,187,302
								Non-Appropriated Funds
								Deferred Compensation Admin Account - Non-Appropriated							2,501,323			2,934,026		2,960,792

								Total All Funds							34,354,771			34,830,203		37,148,094

Operating Budget: Summary by Object

					1994-95 Actual			1995-96 Estimated			1996-97 Estimated			1997-98 Proposed			1998-99 Proposed
Salaries And Wages				8,563,746			8,595,389			8,602,086			8,568,424			8,348,110
Employee Benefits				2,373,748			2,344,004			2,308,712			2,267,343			2,196,961
Personal Service Contracts				104,025			71,125			657,446			877,226			329,176
Goods And Services				6,031,795			6,036,734			5,807,186			6,043,540			6,376,526
Travel				54,275			57,568			102,750			107,504			74,004
Capital Outlays				643,320			157,858			361,019			795,695			1,455,794
Grants, Benefits & Client Services				200
Debt Service				180,344			49,999						25,000			25,000
Interagency Reimbursements				(213,670)			(161,274)			(160,399)			(171,104)			(171,105)
Intra-Agency Reimbursements				4

Annual Total				17,737,787			17,151,403			17,678,800			18,513,628			18,634,466

Operating Budget: Program Summary

					1994-95 Actual			1995-96 Estimated			1996-97 Estimated			1997-98 Proposed			1998-99 Proposed
Administration				4,667,887			4,980,915			6,294,536			6,593,528			5,362,769
Retirement Operations				4,320,633			3,876,710			3,614,284			3,265,181			3,212,127
Information Services				7,248,238			6,649,768			6,124,875			7,026,481			8,370,129
Deferred Compensation				1,338,985			1,460,478			1,473,548			1,458,395			1,502,397
Dependent Care				162,044			183,532			171,557			170,043			187,044
Annual Total				17,737,787			17,151,403			17,678,800			18,513,628			18,634,466
Fiscal Year 1993-94				16,616,984
Biennium Total				34,354,771			34,830,203						37,148,094

Operating Budget: Change from Preceding Biennium

				1993-95 Actual								1995-97 Estimated								1997-99 Proposed
				Amount			Percent				Amount					Percent			Amount					Percent
Administration			4,073,202			82.5%				2,263,480					25.1%			680,846					6.0%
Retirement Operations			(2,043,840)			(18.8)%				(1,350,314)					(15.3)%			(1,013,686)					(13.5)%
Information Services			(200,944)			(1.4)%				(892,184)					(6.5)%			2,621,967					20.5%
Deferred Compensation			349,532			16.2%				432,703					17.3%			26,766					0.9%
Dependent Care			(10,022)			(2.9)%				21,747					6.5%			1,998					0.6%
Belated Claims			(3,302)			(100.0)%

Total			2,164,626			6.7%				475,432					1.4%			2,317,891					6.7%

Employment Summary

			1994-95 Actual			1995-96 Estimated		1996-97 Estimated				1997-98 Proposed			1998-99 Proposed
FTE Staff Years			264.8		250.8			242.1				243.5				234.2
Average FTE Staff Year Costs			32,340			34,272		35,531				35,189				35,645

Agency Local Funds

Public Employees' Retirement System Plan I Account
This fund is composed of all Plan 1 monies received from investment earnings, member contributions, and employer contributions. The fund accounts for the assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the Public Employees' Retirement System Plan 1 members.
Public Employees' Retirement System Plan II Account
This fund is composed of all Plan 2 monies received from investment earnings, member contributions, and employer contributions. The fund accounts for the assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the Public Employees' Retirement System Plan 2 members.
Teachers' Retirement System Plan I Account
This fund is composed of all Plan 1 monies received from investment earnings, member contributions, and employer contributions. The fund accounts for the assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the Teachers' Retirement System Plan 1 members.
Teachers' Retirement System Plan II Account
This fund is composed of all Plan 2 monies received from investment earnings, member contributions, and employer contributions. The fund accounts for the assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the Teachers' Retirement System Plan 2 members.
Washington Law Enforcement Officers' and Fire Fighters'
(LEOFF) System Plan I Retirement Account This fund is composed of all Plan 1 monies received from investment earnings, member contributions, and employer contributions. The fund accounts for assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the LEOFF Retirement System Plan 1 members.
Washington Law Enforcement Officers' and Fire Fighters'
(LEOFF) System Plan II Retirement Account This fund is composed of all Plan 2 monies received from investment earnings, member contributions, and employer contributions. The fund accounts for assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the LEOFF Retirement System Plan 2 members.
Washington State Patrol Retirement Account
This fund is composed of all monies received from investment earnings, member contributions, and employer contributions. The fund accounts for the assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the State Patrol Retirement System.
Judges' Retirement Account
This fund is composed of all monies appropriated from the state General Fund, investment earnings, member contributions, and employer contributions. The fund accounts for assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the Judges' Retirement Fund.
Washington Judicial Retirement Account
This fund is composed of all monies appropriated from the state General Fund, investment earnings, member contributions, and employer contributions. The fund accounts for assets, income, payment of benefits, including pension and refund payments, and adjustments associated with the Judicial Retirement System.

Statement of Local Fund Balances

			6/30/95 Fund Balance			6/30/97 Estimated Fund Balance			1997-1999 Estimated Revenues			1997-1999 Estimated Expenditures		6/30/99 Estimated Fund Balance
Non-Budgeted Funds
Public Employees' Retirement System Plan I Account			6,289,920,060			7,747,282,277		2,602,476,534			1,140,001,566			9,209,757,245
Public Employees' Retirement System Plan II Account			4,874,645,128			7,071,162,986		2,656,669,850			161,047,052			9,566,785,784
Teachers' Retirement System Plan I Account			5,449,809,733			6,774,013,609		2,266,623,784			978,207,304			8,062,430,089
Teachers' Retirement System Plan II Account			1,808,214,349			2,689,685,154		1,048,130,462			21,108,495			3,716,707,121
LEOFF System Plan I Retiement Account			3,112,599,913			3,831,521,203		1,095,525,506			414,093,037			4,512,953,672
LEOFF System Plan II Retiement Account			854,300,874			1,264,278,962		425,203,591			8,135,292			1,681,347,261
Washington State Patrol Retirement Account			368,582,577			448,559,150		112,152,510			37,379,315			523,332,345
Judges' Retirement Account			2,555,839			3,470,666		1,107,214			908,062			3,669,818
Judicial Retirement Account			2,230,490			4,086,034		14,958,776			15,405,173			3,279,637
Total Non-Budgeted Funds			22,762,858,963			29,834,060,041		10,222,848,227			2,776,285,296			37,280,262,972

Program Level Detail

Administration

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The purpose of the Administration program is to perform administrative accounting services, trust fund accounting services, budgeting services, revenue collection, payment of pensions and withdrawals, office services, word processing services, records management, and personnel services.

The objective is to adhere to established accounting, operating, budgetary, and personnel practices in support of the agency and the retirement systems' members.

Program Employment

			1994-95 Actual			1995-96 Estimated		1996-97 Estimated				1997-98 Proposed			1998-99 Proposed
FTE Staff Years			67.1		71.2			75.2				78.6				70.7
Average FTE Staff Year Costs			32,661			33,696		33,123				33,561				34,701

Expenditure Detail

				1994-95 Actual			1995-96 Estimated			1996-97 Estimated			1997-98 Proposed			1998-99 Proposed
Salaries and Benefits			2,788,949			3,055,427			3,170,697			3,346,427			3,102,395
Other Operating Costs			1,878,938			1,925,488			3,123,839			3,247,101			2,260,374

Annual Total			4,667,887			4,980,915			6,294,536			6,593,528			5,362,769
Fiscal Year 1993-94			4,344,084
Biennium Total			9,011,971			11,275,451						11,956,297

Source of Funds - Dept of Retirement Systems Expense - State

Retirement Operations

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The purpose of the Retirement Operations program is to establish and maintain member accounts for six retirement systems, calculate pension and withdrawal benefits, provide retirement benefit counseling services, publish retirement plan information, present pre-retirement seminars, and provide policy development and project management services.

The objective is to provide members with reliable, accurate, and timely benefits and information.

Program Employment

			1994-95 Actual			1995-96 Estimated		1996-97 Estimated				1997-98 Proposed			1998-99 Proposed
FTE Staff Years			112.1		96.1			81.1				78.2				76.8
Average FTE Staff Year Costs			29,121			31,660		35,041				33,453				33,589

Expenditure Detail

				1994-95 Actual			1995-96 Estimated			1996-97 Estimated			1997-98 Proposed			1998-99 Proposed
Salaries and Benefits			4,211,864			3,900,333			3,633,991			3,336,034			3,290,000
Grants and Subsidies			200
Other Operating Costs			108,569			(23,623)			(19,707)			(70,853)			(77,873)

Annual Total			4,320,633			3,876,710			3,614,284			3,265,181			3,212,127
Fiscal Year 1993-94			4,520,675
Biennium Total			8,841,308			7,490,994						6,477,308

Source of Funds - Dept of Retirement Systems Expense - State

Information Services

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The purpose of the Information Services program is to design, develop, and implement information systems; enhance existing information systems; provide training and consulting to employers who report member earnings information to the Department; perform in a liaison capacity between the Department and service organizations that build and maintain payroll systems for employers; design, develop, implement, and monitor data bases that support agency information systems; implement and maintain application and data base levels of security; acquire, install, and operate the agency's network environment consisting of desktop hardware and software and the local and wide area networks; install and operate telephone systems in a multi-vendor environment; collect, enter, and process active member earnings submitted by employers; provide Help Desk support for network and mainframe-based information systems; develop and maintain the agency's Strategic and Tactical Information Technology plans and the Security Plan; and conduct and publish feasibility studies for proposed systems development projects.

The objective is to build and maintain information systems that collect, process, and maintain member information efficiently and accurately in support of services delivered to active and retired members.

Program Employment

			1994-95 Actual			1995-96 Estimated		1996-97 Estimated				1997-98 Proposed			1998-99 Proposed
FTE Staff Years			67.3		64.0			65.5				66.3				66.3
Average FTE Staff Year Costs			37,507			39,057		39,647				39,988				39,813

Expenditure Detail

				1994-95 Actual			1995-96 Estimated			1996-97 Estimated			1997-98 Proposed			1998-99 Proposed
Salaries and Benefits			3,189,014			3,153,455			3,252,759			3,311,078			3,296,559
Other Operating Costs			4,059,224			3,496,313			2,872,116			3,715,403			5,073,570

Annual Total			7,248,238			6,649,768			6,124,875			7,026,481			8,370,129
Fiscal Year 1993-94			6,418,589
Biennium Total			13,666,827			12,774,643						15,396,610

Source of Funds - Dept of Retirement Systems Expense - State

Deferred Compensation

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The purpose of the Deferred Compensation program is to enable eligible employees to defer a portion of their earnings until retirement or termination of employment.

Objectives are to: maintain and enhance the program; improve services to participants; increase employee awareness of the program; and obtain maximum return on investments for participants consistent with risk levels appropriate for each type of investment.

Program Employment

			1994-95 Actual			1995-96 Estimated		1996-97 Estimated				1997-98 Proposed			1998-99 Proposed
FTE Staff Years			17.0		17.2			17.8				17.9				17.9
Average FTE Staff Year Costs			30,514			33,785		33,511				32,854				33,407

Expenditure Detail

				1994-95 Actual			1995-96 Estimated			1996-97 Estimated			1997-98 Proposed			1998-99 Proposed
Salaries and Benefits			662,980			737,022			756,413			746,318			757,548
Other Operating Costs			676,005			723,456			717,135			712,077			744,849

Annual Total			1,338,985			1,460,478			1,473,548			1,458,395			1,502,397
Fiscal Year 1993-94			1,162,338
Biennium Total			2,501,323			2,934,026						2,960,792

Source of Funds - Deferred Compensation Admin Account - Non-Appr

Dependent Care

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The purpose of the Dependent Care program is to enable eligible employees to set aside a before-tax portion of their earnings for reimbursement of their dependent care expenses.

The objective is to maintain service quality while controlling or reducing costs.

Program Employment

			1994-95 Actual			1995-96 Estimated		1996-97 Estimated				1997-98 Proposed			1998-99 Proposed
FTE Staff Years			1.3		2.3			2.5				2.5				2.5
Average FTE Staff Year Costs			49,797			31,726		30,422				30,075				31,005