Assigned to FIN                                                                                                                 AS PASSED BY COW

ARIZONA STATE SENATE

Fifty-Fourth Legislature, First Regular Session

AMENDED

FACT SHEET FOR S.B. 1213

tax credits; affordable housing.

(NOW: ASRS; return to work)

Purpose

            Specifies that an Arizona State Retirement System (ASRS) employer is not required to pay the alternate contribution rate (ACR) if the retired ASRS member (member) returns to work in a position that is currently filled by an active member for whom the ASRS employer (employer) is currently paying contributions.

Background

Current statute requires an employer to pay contributions at an ACR on behalf of a retired member who returns to work with an employer in any capacity in a position ordinarily filled by an employee or in a position that is similar in duties and responsibilities to that of a position ordinarily filled by an employee (A.R.S. § 38-766.02). This applies to a retired member who has reached a normal retirement age or a retired member who retired if that retired member's retirement benefit has not been suspended during that employee's return to work status.

            The ACR formula was statutorily defined and instituted on July 1, 2012, at a rate of 8.64 percent. The current ACR contribution for FY 2019 is 10.53 percent.

            There is no anticipated fiscal impact to the state General Fund associated with this legislation.

Provisions

1. Specifies that an employer is not required to pay the ACR if the retired member returns to work with the employer in a position that is currently filled by an employee of whom is an active member and for which the employer is currently required to pay and is paying contributions on behalf of the active member in that same position.

2. Allows an employer to pay the ACR for a retired member who meets the requirements for an exemption.

3. Allows an employer to request an employer credit for those contributions, not including interest, within 90 days after the end of the fiscal year in which the contributions were paid, if ASRS and the employer determine that the ACR does not apply, beginning July 1, 2019.

4. Requires ASRS to issue a refund to an employer in a form determined by ASRS, if it determines that an employer credit is not feasible.

5. Makes technical changes.

6. Becomes effective on the general effective date.

Amendments Adopted by Committee

1. Adopted the strike-everything amendment.

2. Makes technical clarifications.

Senate Action

FIN                 2/20/19     DPA/SE    10-0-0

APPROP         2/20/19     W/D

Prepared by Senate Research

March 5, 2019

CS/kja