This bill amends RCW 41.50.255 to allow the director of the Department of Retirement Systems to pay certain expenses from the interest earnings of specified retirement system trust funds. It is a modification of existing law that changes which kinds of expenses may be charged to interest earnings and how recovered funds are returned. The change permits payment of legal and medical expenses when those costs are primarily incurred to protect the appropriate trust fund or to comply with statutes governing the funds. It also permits payment from interest earnings for preventing and investigating fraud and for collecting overpayments, including collection agency fees and other recovery costs. Recovered overpayments must be returned to the appropriate trust funds. The statute text lists examples of covered activities and costs, including audits, cybersecurity work, petition decisions, liaison with the attorney general, legal services through the legal services revolving fund, expert witness fees, transcript costs, medical examinations and medical report preparation. The retirement systems named include the public employees', teachers', Washington state patrol, Washington judicial, judges', school employees', public safety employees', and law enforcement officers' and firefighters' systems. The amendment appears to remove or alter a previous parenthetical definition of "administrative expenses," but the full prior text of RCW 41.50.255 is not provided here so the exact scope of the change is uncertain. The bill was passed by the Senate on February 11, 2026 and by the House on March 4, 2026, sponsored by Senate Ways & Means and requested by the Department of Retirement Systems; no effective date or final filing date is shown in the provided facts.

If enacted, the director of the Department of Retirement Systems could pay legal and medical costs, and costs to prevent and investigate fraud and collect overpayments, out of the interest earnings on the named retirement trust funds rather than from other sources. That means DRS would have a funded way to cover attorney fees, expert witness and medical exam costs, audits, cybersecurity work, petition decisions, liaison with the attorney general, collection agency fees and similar recovery costs, and any money recovered from overpayments would be returned to the same trust funds. The groups most affected are the listed retirement trust funds and their members and employers, because some investment interest that would otherwise accrue to the funds could instead be used to cover these operating costs; DRS and the Office of the Attorney General would have clearer authority and funding to pursue fraud prevention and recovery. The text does not show an effective date or full previous wording (a struck-through definition appears), so the timing and the precise scope of the change compared with current law are unclear.