ELECTED OFFICIALS RETIREMENT PLAN

2009 LEGISLATIVE SESSION (ended July 1, 2009)

 

Bills become law on September 30, 2009 (unless stated otherwise)

 

Bills enclosed in a border have been passed.  To review a bill in its entirety, please visit the State Legislature’s Website: www.azleg.state.az.us

 

 

HB2110          PUBLIC RETIREMENT PLANS; FEDERAL CHANGES

 

Various technical changes to EORP, CORP, and PSPRS to conform the plans to federal law.

 

Provisions

·   Mandates that the plan make payments under the regulations of the Internal Revenue Code (IRC).

·   Instructs that payments of benefits shall not begin any later than April 1, following the year which the member reaches 70.5 years of age or the date the member terminates employment.

·   Caps member compensation at $150,000 from January 1, 1996 through December 31, 2001.

·   Caps member compensation at $200,000 beginning January 1, 2002.

·   States that if the compensation is established for a time less than 12 months, the compensation limit for that period of time will equal the dollar limit for the calendar year during which the period of time begins multiplied by time served.

·   Authorizes the fund manager to adjust annual compensation limits under IRC regulation.

·   Sets forth a maximum annual pension of the lesser of $90,000 or 100% percent of the member’s annual salary for years beginning before 1995.

·   Sets forth a maximum annual pension of $90,000 for years beginning in 1995 and ending before 2002.

·   Sets forth a maximum annual pension of $160,000 for years ending in and after 2002.

·   States that the maximum annual pensions will be determined by section 415 of the IRC, and allows the pensions to be reduced to prevent disqualification under this federal law.

·   Allows members to redeem services through a lump-sum payment, trustee-trustee transfer, direct rollover, an eligible rollover distribution from an individual retirement account, or annuity.

·   Determines that lump-sum payments are eligible for direct rollover distribution.

·   Validates service credits for active military service occurring before the member’s current employment if:

·   The member was honorably discharged from the military.

·   The active military service does not exceed 48 months.

·   The period of service for which the member receives credited service is not on account with another retirement system, unless provided by 10 U.S.C. § 12736.

·   The member pays to purchase the previous active military service.

·   States that an active member who volunteers or is ordered by the military may not receive more than 60 months of military service under the Uniformed Services Employment and Reemployment Rights Act.

·   Requires employer and employee contributions to continue if:

·   The employee was an active member of the plan the day prior to beginning military service.

·   The employee entered into the armed forces or is a member of the National Guard.

·   The employee complies with the notice and return to work requirements of 38 U.S.C. § 4312.       

·   Mandates that contributions made as a result of an active member volunteering or being ordered into military service must be for the period of time beginning on the date the member began military service and ending on the later of:

·   The date the member is separated from military service.

·   The date the member is released from service-related hospitalization or two years after the start of service-related hospitalization, whichever is earlier.

·   The date the member dies as a result of military service.

·   Stipulates that a member may not receive credit for any military service in excess of 60 months. 

·   Instructs the employer and member contributions to be based on the contributions the member would have received but for the military service, and if that rate is indeterminate the contribution rate is based on the member’s average rate of compensation during the 12-month period immediately preceding the military service.

·   Allows the member to make contributions up to three times the length of military service so long as that time does not exceed 60 months.

·   Requires the employer to make their contributions in a lump sum after the member has made his or her contributions, or upon receipt of the member’s death certificate.

·   Directs the employer to make contributions to the plan for any military differential wage pay the employer would have paid to members serving in the military.

·   Includes the time of military service in the computation of the member’s total credited service.

·   Mandates that the employer and member contributions on the member’s return to employment if the member performs military service due to a presidential call-up, not exceed 48 months.

·   States that the statute must be interpreted in a manner consistent with section 414(u) of the IRC.

·   Clarifies that a deferred annuity is not a retirement benefit and that annuitants are not permitted to receive a tax-equity benefit allowance, death benefits, benefit increases or group health and accident coverage for retirees.

·   States that a retired member of PSPRS is not eligible for pension payments if he or she becomes employed by the employer from which the member retired earlier than 12 months after the member’s retirement.

·   Stipulates that the statutes relating to deferred retirement under PSPRS apply to new members and current members who have not already applied for and begun receiving benefits.

·   Defines actuarial equivalent, annuitant, direct rollover, distributee, eligible retirement plan and eligible rollover distribution.

·   Makes the provisions of the bill retroactive to from and after December 31, 1993.

·   Contains a conditional enactment clause.

·   Makes technical and conforming changes.

 

Sponsor:  Rep. Boone

 

Current Action:  7/10 signed by Governor.  Chapter 35, Laws 2009.

 

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HB2109          RETIREMENT SYSTEMS AND PLANS; AMENDMENTS

 

Changes in statutes governing the Elected Officials Retirement Plan, the Public Safety Personnel Retirement System and the Corrections Officer Retirement Plan pertaining to procedures used when the plan receives an order regarding distribution of a member's community property.  The proposed changes of HB2109 are already within A.R.S sections 9-956, 38-822, 38-860, and 38-910.  HB2109 relocates the latter provisions into alternative subsections of the aforementioned sections. 

 

Provisions

 

Sponsor:  Rep. Boone

 

Current Action:  Held in Senate.

 

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HB2325          RETIREMENT; EORP; OMNIBUS AMENDMENTS 

 

Various changes to statutes governing the Elected Officials Retirement Plan, including establishing penalties for fraud or theft of the plan or a participating employer, and designating EORP as a jural entity that may sue and be sued.  Also makes clarifying changes to benefits for surviving spouses and children of deceased members, retroactive to July 1, 2001.

 

Sponsor:  Rep. Boone

 

Current Action:  Held in Senate.

 

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HCR2016       RETIREMENT AGE; JUSTICES & JUDGES 

 

The 2010 general election ballot is to carry the question of whether to amend the state Constitution to increase the mandatory retirement age for judges and justices to 75 from 70.

 

First sponsor:  Rep. Driggs

Others:  Rep. Barto, Rep. Crandall, Rep. Crump, Rep. Goodale

 

Current Action:   Held in House.

 

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SB1207           RETIREMENT; EORP; PARTICIPATION IN ASRS 

 

 

An elected official subject to term limits who has more than 20 years of credited service in the Elected Officials Retirement Plan (EORP) may elect to become a member of the Arizona State Retirement System (ASRS).

 

Sponsor:  Sen. McCune Davis

 

Current Action:  Held in Committees.

 

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