Assigned to FIN FOR
COMMITTEE
Assigned to FIN FOR
COMMITTEE
ARIZONA STATE SENATE
Fifty-Third Legislature, Second Regular Session
social security; state agency designation
Purpose
Authorizes the Governor to designate a state agency as the Social Security Administrator for Arizona.
Background
A Section 218 Agreement is a voluntary, irrevocable agreement between a state and the United States Social Security Administration (SSA) to provide Social Security and Medicare Hospital Insurance (HI) or Medicare HI-only coverage for state and local government employees, authorized under Section 218 of the federal Social Security Act of 1935. Each state has a designated official, known as the Social Security Administrator, who is responsible for administering that state's Section 218 Agreement and providing public employers with information and advice about Social Security and Medicare coverage for their employees. Section 218 Agreements cover positions, rather than individual public employees. If a position is covered, then the employee who fills that position is subject to Social Security and Medicare taxes (SSA).
Current law allows the Governor to enter into an agreement with the Commissioner of Social Security on Arizona's behalf, for the purpose of extending the benefits of the federal Old Age and Survivors Insurance system to state and political subdivision employees, as specified in the agreement (A.R.S. § 38-702). Statute designates the Arizona State Retirement System (ASRS) Board as the Social Security Administrator for Arizona (A.R.S. § 38-701).
The Old Age and Survivors Insurance Trust Fund, established under Section 201 by the Social Security Amendments of 1939, is a separate account of the United States Treasury that provides the SSA with automatic spending authority to provide monthly benefit payments to retired workers and their dependents (SSA).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Allows the Governor to designate a state agency as the Social Security Administrator for the state under the federal Old Age and Survivors Insurance system.
2. Allows rules adopted by the ASRS Board to remain in full force until amended by the state agency that is designated as the new Social Security Administrator.
3. Becomes effective on the general effective date.
House Action
BI 1/11/18 DP 5-3-0-0
3rd Read 2/6/18 34-24-1-0-1
Prepared by Senate Research
February 26, 2018
FB/lb