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Board votes to lower Tier 1 employee contribution rates


Public Safety Personnel Retirement System
State of Arizona

March 30, 2017
Contact: Christian Palmer
Phone: 602-255-5575

PSPRS board votes to lower Tier 1 employee contributions
Trustees’ vote is first step towards return of excess contributions

The Arizona Supreme Court issued its mandate in the Hall v. EORP lawsuit for the Superior Court to begin implementing the remedies afforded by the ruling and it has been determined by the PSPRS Board of Trustees that those remedies will also apply to the Parker lawsuit.

Therefore, effective immediately by Board action this afternoon, the employee contribution rates for all members hired on or before July 19, 2011, are to revert to the following rates at the beginning of the first complete pay period on or after April 1, 2017, or as soon as practicable for employers after that.

*             EORP (Hall lawsuit): 7.00%
*             PSPRS (Parker lawsuit): 7.65%

Excess contributions will be returned, but PSPRS is unable to provide an estimated time frame of when that will happen before the parties agree in Superior Court as to the rate of interest, the time period for which that interest applies and the methods for which the contributions may be returned.

However, reverting the contribution rates to the above amounts is the crucial first step before any excess contributions can be calculated. PSPRS will work with employers to identify members impacted by the Hall or Parker lawsuits.

The Hall and Parker-related refunds of excess contributions do not apply to members of the Corrections Officer Retirement Plan. However, members of CORP, EORP, and PSPRS who retired after the effective date of the 2011 legislation may be owed retroactive benefit increases calculated under the previous permanent benefit increase (PBI) formula.

PSPRS will continue to provide members, employers and local boards all pertinent updates regarding the Hall and Parker lawsuits.

Thank you for your valuable service to Arizona,

PSPRS Administrator Jared Smout