PSPRS Online Services:

A Word to Our Members and Employers


The PSPRS emails sent last week and yesterday to our members and employers included an incomplete table of the explanations of the different tiers of benefits for our members, as well as operational characteristics of the PSPRS system. We’d like to apologize for any confusion that caused. We have provided the most up-to-date information below.

Jared Smout
PSPRS Administrator

SB1428 Pension Reform Matrix of Changes

1. The Hybrid plan is primarily a DB plan with a DC component and is only available and required for Tier 2 and 3 members who do not contribute to Social Security. However, Tier 2 members have the ability to opt out of the DC requirement by June 30, 2017.

2. May revert back to 7.65% for Tier 1 due to the ruling in the Hall case. Also, it is important to note that even though Tier 2 began January 1, 2012, the employee contribution rate increased beginning with the first pay period in July 2011. Therefore, should the rate be reversed due to Hall, it will only be reversed for those members hired before the effective date of July 20, 2011. This will cause the issue of having some Tier 1 members contribute at the 11.65% rate.

3. MOE = Maintenance of Effort. For fiscal year 2011-2012 and each fiscal year thereafter, the amount of the member’s contribution that exceeds 7.65 percent of the member’s compensation shall not be used to reduce the employer’s contributions. (ARS § 38-843(F))

4. Due to a technical error in SB1428 in 2016 that is being corrected with HB2485 in 2017, this method cannot be implemented until enactment of that bill.