2007-07-23_George_Kahoohanohano_et_al_v._State_of_Hawaii_et_al_-_Opinion_of_the_court_by_Justice_Acoba

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Kaho'ohanohano v. State Page 25 of 46 in the fund by the Territory, holding up as a horrible example the complete breakdown of the system in New York." Id. (emphasis added). Delegate Ashford further stated, "I have no doubt at all that the constitutional provision was written into the Constitution of New York because it had broken down under the old system." Id. (emphasis added). Delegate Tavares had expressed concern that the provision may have meant that "the legislature guarantees that no employee in the future will ever be given less benefits proportionately than the employees today and that the legislature guarantees to put all of the money necessary from now to forever to cover whatever the benefits may be[.]" Id. In response, Delegate Ohrt explained that the "benefits of which shall not be diminished or impaired," applied to the benefits of"all those that are now members of the system." Id. Delegate Ohrt further clarified that the existing members of the system "have made their contributions and the benefits are a fixed benefit plan. And it's just such a reduction or the impairment of those benefits that the employees should be concerned with." Id. B. In the delegates' view, an ERS member's constitutional right under article XVI, section 2 that the accrued benefits shall not be diminished or impaired is inextricably tied to protecting the source of such benefits. Delegate Ohrt emphasized that the funding of the system was foremost in the delegates' minds: TAVARES: . . . [D]oes the delegate interpret this provision to mean that it is also a contract by the legislature guaranteeing to put up every bit of money necessary in the future to make good these proposed benefits set forth in the present law? OHRT: That would be my interpretation of it.Yes,I think the government employees should have that. NIELSEN: . . .Has the government so far in the Territory put up all the money they should have put up? OHRT: The answer to that would be yes. NIELSEN: It seems to me in the'47 session,they didn't want to give you the funds to keep the security sound. OHRT: Well,that's correct.There was an effort to delete certain funds but the legislature finally appropriated them. TAVARES: Is it not true that we have some considerable amount yet that we owe that we haven't paid up for the reserves because we started[it]in 1925 with Territorial employees and had to make up all the back years ourselves without any contributions from the employees? OHRT: That covers the amount that covers prior service [credit]. TAVARES: What is the balance now? OHRT: About$4,000,000,but that is funded. The Territory is paying that. I don't recall what the rate is but a certain percentage each year is being paid. TAVARES: We have extended it once already,haven't we? OHRT: Yes,and those are just the things that we are trig to avoid. TAVARES: In other words,we are not up to date then in our obligations. OHRT: No,insofar as prior service,we are not. That's right. Id. at 495-96 (emphases added). As indicated by the delegates' debate, ERS funds must be secure in order to ensure that the ERS will be able to fulfill its obligations to its members into the future. Hence, the State's contention that "[a] rticle XVI, section 2 of the Hawaii Constitution does not concern funding of retirement benefits" is not persuasive. Article XVI, section 2 must necessarily protect funding of the ERS. To hold otherwise would permit the State to jeopardize the security of the retirement system, -- the very circumstance that the delegates of the 1950 Constitutional Convention expressly sought to prevent. http://www.state.hi.us/jud/opinions/sct/2007/26178.htm 8/12/2008