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Bill

HB 2277

RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM'S EMPLOYER CONTRIBUTIONS FOR NORMAL COST AND ACCRUED LIABILITY.

2026 Regular Session Introduced by Nadine Nakamura

HB 2277 restructures Hawaii's public employee pension funding by revising employer contribution calculations for normal costs and unfunded liabilities, affecting state and county budgets.

Referred to LAB, FIN, referral sheet 5
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Bill Summary · HB 2277

Legislative bill overview

HB 2277 modifies how Hawaii's Employees' Retirement System (ERS) calculates and funds employer contributions, specifically addressing the split between normal cost (ongoing pension accrual) and accrued liability (unfunded pension obligations). The bill adjusts the contribution methodology that determines how much state and county employers must pay annually into the retirement system.

Why is this important

Hawaii's ERS is significantly underfunded, creating long-term budget pressures for state and county governments. How contributions are structured directly affects annual government budgets and the system's financial sustainability—changes here could shift costs between current taxpayers, government entities, and future retirees. This is one of Hawaii's largest long-term fiscal liabilities.

Potential points of contention

  • Budget impact timing: Whether changes increase, decrease, or defer employer contribution obligations, affecting immediate government budgets versus long-term liability management
  • Equity between parties: How contribution changes distribute financial responsibility among the state, counties, current employees, retirees, and taxpayers
  • Actuarial sustainability: Whether modified contribution rates adequately fund pension promises or potentially worsen the system's unfunded status over time

Compiled from official sources — confirm details with the bill’s official record.

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