June 1, 2021
Public Safety Personnel Retirement System
State of Arizona
Retirement process changes coming to PSPRS and local boards
Gov. Doug Ducey signed into law a bill designed to improve local board training and add efficiency to the retirement application process for members of PSPRS-managed plans.
House Bill 2381 was supported by member organizations, employers and the PSPRS Board of Trustees, and passed through the state House of Representatives on a unanimous vote.
Retirement and disability retirement provisions
Effective January 1, 2022, all retirement applications with the exception of disability and line of duty deaths will be sent by employers to PSPRS, which maintains official credited service and contribution records used to determine benefit amounts.
Local boards will continue to determine the membership eligibility of new hires and consider and take action on disability retirement and line-of-duty-death benefit applications. Approved disability and line-of-duty death applications will be reviewed by PSPRS to ensure compliance with state law.
The law also requires employers to submit members’ completed normal retirement applications to PSPRS within 10 days upon receiving applications from retiring members. Similarly, local boards must submit a copy of disability retirement and line-of-duty death benefit applications within 10 days upon receipt. Please note that this will require local boards to submit disability and line-of-duty death applications prior to local board consideration and action.
Under the law, PSPRS must contact the employer and the retiring member if there is a need to resolve discrepancies related to credited service, salary or other employment-related records. PSPRS reviews of disability and line-of-duty death benefit determinations may result in local board rehearings, and, if necessary, judicial review.
Local board training
PSPRS currently provides training and information to local board members and secretaries. However, under HB2381, PSPRS is obligated to give and local boards are obligated to undergo training for open meeting law laws, ethics, legal reviews, and fiduciary responsibilities and duties.
PSPRS is in the process of designing its local board training curriculum. Local board secretaries and members elected or appointed after Dec. 31, 2021, must complete training within 180 days. Board members and secretaries elected or appointed prior to Dec. 31, 2021, will be encouraged to attend training sessions.
Starting Jan. 1, 2022, local boards will be able to transmit meeting minutes to PSPRS via email and will not be required to use certified mail.
Additional PSPRS authority
The aim of the law is to improve and add efficiency to the local and state administrative process for determining retirement eligibility and benefits. To ensure that PSPRS-plan member benefits are uniformly administered according to state law, employers and local boards will be required to comply with all PSPRS requests for documentation related to members’ employment and benefit applications.
Non-compliance with state law and model uniform rules and failure to take corrective action may result in PSPRS assuming local board duties until uncorrected matters are resolved.
Voluntary local board consolidation
HB2381 also allows for local boards to consolidate through intergovernmental agreements (IGAs). Consolidation is entirely voluntary and the law does not alter the makeup and requirements for members and secretaries to serve on local boards.