HB2469 - 542R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 23-1046, Arizona Revised Statutes, is amended to read:

START_STATUTE23-1046. Death benefits; definitions

A. Except as provided in subsection C of this section, in case of an injury causing death, the compensation therefor shall be known as a death benefit and shall be payable in the amount, for the period, and to and for the benefit of the following:

1. Burial expenses, not to exceed five thousand dollars $5,000, in addition to the compensation.

2. To the surviving spouse, if there are no children, sixty‑six and two‑thirds per cent percent of the average monthly wage of the deceased, to be paid until such spouse's death or remarriage, with two years' compensation in one sum upon on remarriage. To the surviving spouse if there are surviving children, thirty‑five per cent percent of the average monthly wage of the deceased, to be paid until such spouse's death or remarriage with two years' compensation in one sum upon on remarriage, and to the surviving children, an additional thirty‑one and two‑thirds per cent percent of the average monthly wage, to be divided equally among them until the age of eighteen years of age, until the age of twenty‑two years of age if the child is enrolled as a full‑time student in any accredited educational institution, or if over eighteen years of age and incapable of self‑support, when the child becomes capable of self‑support. When all surviving children are no longer eligible for benefits, the surviving spouse's benefits shall be paid as if there were no children. In the event of the subsequent death or remarriage of the surviving spouse, the surviving child's or children's benefits shall be computed pursuant to paragraph 3 of this subsection.

3. To a single surviving child, in the case of the subsequent death or remarriage of a surviving husband or wife, or if there is no surviving husband or wife, sixty‑six and two‑thirds per cent percent of the average monthly wage of the deceased, or if there is more than one surviving child, sixty‑six and two‑thirds per cent percent to be divided equally among the surviving children. Compensation to any such child shall cease upon on death, upon on marriage or upon on reaching the age of eighteen years of age, except, if over eighteen years of age and incapable of self‑support, when he the person becomes capable of self‑support, or if over eighteen years of age and enrolled as a full‑time student in any accredited educational institution, when the child reaches age twenty‑two years of age.

4. To a parent, if there is no surviving husband, wife or child under the age of eighteen years of age, if wholly dependent for support upon on the deceased employee at the time of his the employee's death, twenty‑five per cent percent of the average monthly wage of the deceased during dependency, with an added allowance of fifteen per cent percent if two dependent parents survive, and, if neither parent is wholly dependent, but one or both partly dependent, fifteen per cent percent divided between them share and share alike.

5. To brothers or sisters under the age of eighteen years of age, if there is no surviving husband or wife, dependent children under the age of eighteen years of age or dependent parent, the following shall govern:

(a) If one of the brothers or sisters is wholly dependent upon on the deceased employee for support at the time of injury causing death, twenty‑five per cent percent of the average monthly wage until the age of eighteen years of age.

(b) If more than one brother or sister is wholly dependent, thirty‑five per cent percent of the average monthly wage at the time of injury causing death, divided among such dependents share and share alike.

(c) If none of the brothers or sisters is wholly dependent, but one or more are partly dependent, fifteen per cent percent divided among such dependents share and share alike.

B. If the deceased employee leaves dependents only partially dependent upon his on the deceased employee's earnings for support at the time of the injury, the monthly compensation shall be equal to such proportion of the monthly payments for the benefit of persons totally dependent as the amount contributed by the employee to such partial dependents bears to the average wage of the deceased at the time of the injury resulting in his the employee's death. The duration of compensation to partial dependents shall be fixed by the commission in accordance with the facts shown, and in accordance with the provisions of section 23‑1047, but shall in no case exceed compensation for one hundred months.

C. If the deceased employee was a law enforcement officer who was killed in the line of duty, the surviving spouse shall continue to receive death benefits pursuant to subsection A, paragraph 2 of this section until the surviving spouse's death regardless of whether the surviving spouse remarries.

C. D. In the event of death of a dependent before expiration of the time named in the award, the funeral expenses of such person, not to exceed eight hundred dollars $800, shall be paid.

E. For the purposes of this section:

1. "Killed in the line of duty" has the same meaning prescribed in section 38‑888.

2. "Law enforcement officer" has the same meaning prescribed in section 38‑1114. END_STATUTE

Sec. 2. Section 38-846, Arizona Revised Statutes, is amended to read:

START_STATUTE38-846. Death benefits

A. The surviving spouse of a deceased retired member shall be paid a surviving spouse's pension if the spouse was married to the member for a period of at least two consecutive years at the time of the member's death. Payment of a surviving spouse's pension shall commence as of the last day of the month following the retired member's date of death. The last payment shall be made as of the last day of the month in which the surviving spouse's death occurs.

B. The surviving spouse of a deceased member shall be paid a surviving spouse's pension if the spouse was married to the member on the date of the member's death. Payment of a surviving spouse's pension commences as of the last day of the month following the member's date of death. The last payment shall be made as of the last day of the month in which the surviving spouse's death occurs.

C. The surviving spouse of a deceased retired member is entitled to receive a monthly amount equal to four‑fifths of the monthly amount of pension that the decedent would have received immediately before death.

D. The surviving spouse of a deceased member who was not killed in the line of duty or did not die from injuries suffered in the line of duty is entitled to receive a monthly amount calculated in the same manner as an accidental disability pension is calculated pursuant to section 38‑845, subsection B. The surviving spouse of a deceased member who is killed in the line of duty or dies from injuries suffered in the line of duty is entitled to receive a monthly amount equal to the deceased member's average monthly benefit compensation less any amount payable for an eligible child under this section. A member who was eligible for or receiving a temporary disability pension at the time of the member's death is not deemed to be retired for the purposes of this subsection. For the purposes of this subsection, "killed in the line of duty" means the decedent's death was the direct and proximate result of the performance of the decedent's public safety duties and does not include suicide. For actuarial valuation purposes, the actuarial present value of the amount computed under this subsection for a surviving spouse of a deceased member who is killed in the line of duty or who dies from injuries suffered in the line of duty, plus any amount payable for an eligible child under this section, shall be deposited directly into the employer account and charged against the investment earnings of the fund before those earnings are distributed to each employer.

E. A surviving spouse shall file a written application with the system in order to receive a survivor benefit.

F. If at least one eligible child is surviving at the death of a member or retired member, but no surviving spouse's pension then becomes payable, a guardian's or conservator's pension shall be payable to the person who is serving, or who is deemed by the local board to be serving, as the legally appointed guardian or custodian of the eligible child. If an eligible child of a member or retired member is surviving at the member's or retired member's death, the eligible child is entitled to receive a child's pension payable to the person who is serving or who is deemed by the local board to be serving as the legally appointed guardian or custodian of the eligible child until the eligible child reaches eighteen years of age, at which time the eligible child's pension shall be paid directly to the eligible child if the person remains eligible to receive the pension and is not subject to a guardianship or conservatorship due to disability or incapacity. The pension of a child with a disability who is eighteen years of age or older and who is subject to a guardianship or conservatorship due to disability or incapacity shall continue to be paid to the guardian or conservator if the child remains eligible for the pension payment. A child's pension or a guardian's or conservator's pension terminates if the child is adopted. In the case of a child with a disability, the child's pension or the guardian's or conservator's pension terminates if the child ceases to be under a disability or ceases to be a dependent of the surviving spouse or guardian. The member may also direct by designation to the local board that the guardian or conservator pension or child's pension be paid to the trustee of a trust created for the benefit of the eligible child. A guardian's or conservator's pension shall also become payable if at least one eligible child is surviving when a surviving spouse's pension terminates. The guardian or conservator shall file a written application with the system in order to receive the guardian's or conservator's pension and child's pension.

G. The board shall pay a guardian's or conservator's pension during the same period in which a pension is payable to at least one eligible child. The guardian, conservator or designated trustee is entitled to receive the same monthly amount as would have been payable to the decedent's surviving spouse had a surviving spouse's pension become payable on the decedent's death.

H. Each eligible child is entitled to a monthly amount equal to one‑tenth of the monthly amount of pension that the deceased member or retired member would have received immediately before death. The pension for a child of a deceased member shall be calculated in the same manner as an accidental disability is calculated pursuant to section 38‑845, subsection B. A deceased member shall be assumed to be retired for reasons of accidental disability immediately before the member's death. If there are three or more children eligible for a child's pension, a maximum of two shares of the child's pension shall be payable, the aggregate of such shares to be apportioned in equal measure to each eligible child.

I. If a member has accumulated contributions remaining in the system at the date of death of the last beneficiary, a lump sum refund of such accumulated contributions shall be payable to the person whom the member has designated to the local board as the member's refund beneficiary, or if the member's refund beneficiary is not then surviving, to the designated contingent refund beneficiary, or if the designated contingent refund beneficiary is not then surviving or if the surviving designated beneficiary does not apply for the benefit within twelve months from the date of the member's death, at the election of the local board to the person's nearest of kin as determined by the local board or to the estate of the deceased member. The amount of the lump sum refund shall be the remaining accumulated contributions. The beneficiary or person who is claiming to be the nearest of kin shall file a written application in order to receive the refund.

J. In calculating the right to and the amount of the surviving spouse's pension, the law in effect on the date of the death of the member or retired member controls, unless the law under which the member retired provides for a greater benefit amount for a surviving spouse.

K. In addition to any other death benefits that a surviving spouse or dependent is eligible to receive, a surviving spouse or dependent, if there is not a surviving spouse, shall receive payment for all of the deceased member's unused sick leave. END_STATUTE

Sec. 3. Section 38-857, Arizona Revised Statutes, is amended to read:

START_STATUTE38-857. Group health and accident coverage for retired members; payment; forfeiture of interest

A. On notification, the board shall pay from the assets of the separate account established pursuant to subsection G of this section part of the single coverage premium of any group health and accident insurance for each retired member or survivor of the system who receives a pension and who has elected to participate in the coverage provided by section 38‑651.01 or 38‑782 or any other retiree health and accident insurance coverage provided or administered by a participating employer of the system or a tax‑exempt welfare benefit trust described in section 501(c)(9) of the internal revenue code that provides for the payment of sickness, accident, hospitalization and medical expenses and is designed for the benefit of public safety personnel in this state. The board shall pay up to:

1. One hundred fifty dollars $150 per month for each retired member or survivor of the system who is not eligible for medicare.

2. One hundred dollars $100 per month for each retired member or survivor of the system who is eligible for medicare.

B. On notification, the board shall pay from assets of the separate account established pursuant to subsection G of this section part of the family coverage premium of any group health and accident insurance each month for a benefit recipient who elects family coverage and otherwise qualifies for payment pursuant to subsection A of this section. The board shall pay up to:

1. Two hundred sixty dollars $260 per month if the retired member or survivor of the system and one or more dependents are not eligible for medicare.

2. One hundred seventy dollars $170 per month if the retired member or survivor of the system and one or more dependents are eligible for medicare.

3. Two hundred fifteen dollars $215 per month if either:

(a) The retired member or survivor of the system is not eligible for medicare and one or more dependents are eligible for medicare.

(b) The retired member or survivor of the system is eligible for medicare and one or more dependents are not eligible for medicare.

C. The board shall not pay from assets of the fund more than the amount prescribed in this section for a benefit recipient as a member or survivor of the system.

D. A retired member or survivor of the system may elect to purchase individual health care coverage and receive a payment pursuant to this section through the retired member's former employer if that former employer assumes the administrative functions associated with the payment, including verification that the payment is used to pay for health insurance coverage if the payment is made to the retired member or survivor of the system.

E. This section does not apply to a retired member of the system who becomes a member on or after September 13, 2013 and who is reemployed and participates in health care coverage provided by the member's new employer.

F. This section does not apply to a survivor of the system whose deceased spouse becomes a member on or after September 13, 2013 and who is reemployed and participates in health care coverage provided by the survivor's new employer.

G. The board shall establish a separate account that consists of the benefits provided in this section. The board shall deposit the benefits provided by this section in the account. The board shall not use or divert any part of the corpus or income of the account for any purpose other than the provision of benefits pursuant to this section unless the liabilities to provide the benefits pursuant to this section are satisfied. If the liabilities to provide the benefits described in this section are satisfied, the board shall return any amount remaining in the account to the employer.

H. Payment of the benefits provided by this section is subject to the following conditions:

1. The payment of the benefits is subordinate to the payment of retirement benefits payable by the system.

2. The total of the contributions for the benefits and actual contributions for life insurance protection, if any, shall not exceed twenty‑five percent of the total actual employer and employee contributions to the system, minus the contributions to fund past service credits, after the day the account is established.

3. The contributions by the employer to the account shall be reasonable and ascertainable.

I. Notwithstanding any other provision of this section, if a member is receiving an accidental or catastrophic disability pension, the retired member's employer shall continue to pay the employer portion of the health care benefits that was being paid by the employer on the date that the member's disability pension commenced until the retired member is eligible for medicare.

I. J. If a member who is eligible for benefits under this section forfeits the member's interest in the account before the termination of the plan, an amount equal to the amount of the forfeiture shall be applied as soon as possible to reduce employer contributions to fund the benefits provided by this section. END_STATUTE

Sec. 4. Section 38-904, Arizona Revised Statutes, is amended to read:

START_STATUTE38-904. Death benefits; amount

A. If an active or inactive member dies and no pension is payable on account of the member's death, an amount equal to two times the member's accumulated contributions to the retirement plan is payable to the person designated by the deceased member in writing and filed with the board. If the designated person or persons do not survive the deceased member or if the designated person does not claim the benefit, the payment is payable, at the election of the local board, to the designated person's nearest of kin as determined by the local board or to the estate of the deceased member. The beneficiary or person who is claiming to be the nearest of kin shall file a written application in order to receive the refund. For the purposes of this subsection, "inactive member" means a person who previously made contributions to the plan, who has not retired, who is not currently making contributions to the plan and who has not withdrawn contributions from the plan.

B. If the deceased retired or active member does not have an eligible surviving spouse or the pension of the eligible surviving spouse is terminated, each eligible child is entitled to a child's pension. A child's pension terminates if the child is adopted. In the case of a child with a disability, the child's pension terminates if the child ceases to be under a disability or ceases to be a dependent of the surviving spouse or guardian. The amount of the pension of each eligible child is an equal share of the amount of the surviving spouse's pension. The board shall pay the pension of the surviving minor or child's child with a disability pension to the person who is the legally appointed guardian or custodian of the eligible child until the eligible child reaches eighteen years of age, at which time the eligible child's pension shall be paid directly to the eligible child if the person remains eligible to receive the pension and is not subject to a guardianship or conservatorship due to disability or incapacity. The pension of a child with a disability who is eighteen years of age or older and who is subject to a guardianship or conservatorship due to disability or incapacity shall continue to be paid to the guardian or conservator if the child remains eligible for the pension payment.

C. In addition to any other death benefits that a surviving spouse or dependent is eligible to receive, a surviving spouse or dependent, if there is not a surviving spouse, shall receive payment for all of the deceased member's unused sick leave. END_STATUTE

Sec. 5. Section 38-906, Arizona Revised Statutes, is amended to read:

START_STATUTE38-906. Group health and accident coverage for retired members; payment; forfeiture of interest

1. One hundred fifty dollars $150 per month for each retired member or survivor of the plan who is not eligible for medicare.

2. One hundred dollars $100 per month for each retired member or survivor of the plan who is eligible for medicare.

B. On notification, the board shall pay from the assets of the separate account established pursuant to subsection G of this section part of the family coverage premium of any group health and accident insurance for each retired member or survivor of the plan who elects family coverage and who otherwise qualifies for payment pursuant to subsection A of this section. Payment under this subsection is in the following amounts:

1. Up to two hundred sixty dollars $260 per month if the retired member or survivor of the plan and one or more dependents are not eligible for medicare.

2. Up to one hundred seventy dollars $170 per month if the retired member or survivor of the plan and one or more dependents are eligible for medicare.

3. Up to two hundred fifteen dollars $215 if either:

(a) The retired member or survivor of the plan is not eligible for medicare and one or more dependents are eligible for medicare.

(b) The retired member or survivor of the plan is eligible for medicare and one or more dependents are not eligible for medicare.

C. The board shall not pay more than the amount prescribed in this section for a benefit recipient as a member or survivor of the plan.

D. A retired member or survivor of the plan may elect to purchase individual health care coverage and receive a payment pursuant to this section through the retired member's former employer if that former employer assumes the administrative functions associated with the payment, including verification that the payment is used to pay for health insurance coverage if the payment is made to the retired member or survivor of the plan.

E. This section does not apply to a retired member of the plan who becomes a member on or after September 13, 2013 and who is reemployed and participates in health care coverage provided by the member's new employer.

F. This section does not apply to a survivor of the plan whose deceased spouse becomes a member on or after September 13, 2013 and who is reemployed and participates in health care coverage provided by the survivor's new employer.

G. The board shall establish a separate account that consists of the benefits provided pursuant to this section. The board shall deposit the benefits provided by this section in the account. The board shall not use or divert any part of the corpus or income of the account for any purpose other than the provision of benefits pursuant to this section unless the liabilities to provide the benefits pursuant to this section are satisfied. If the liabilities to provide the benefits described in this section are satisfied, the board shall return any amount remaining in the account to the employer.

H. Payment of the benefits provided by this section is subject to the following conditions:

1. The payment of the benefits is subordinate to the payment of retirement benefits payable by the plan.

2. The total of contributions for the benefits and actual contributions for life insurance protection, if any, shall not exceed twenty‑five percent of the total actual employer and employee contributions to the plan, minus the contributions to fund past service credits, after the day the account is established.

3. The contributions by the employer to the account shall be reasonable and ascertainable.

I. Notwithstanding any other provision of this section, if a member is receiving an accidental or total and permanent disability pension, the retired member's employer shall continue to pay the employer portion of the health care benefits that was being paid by the employer on the date that the member's disability pension commenced until the retired member is eligible for medicare.

Sec. 6. Section 38-1114, Arizona Revised Statutes, is amended to read:

START_STATUTE38-1114. Health insurance payments for spouse or dependents of law enforcement officer killed in the line of duty; applicability; definitions

A. Notwithstanding any other law, the surviving spouse or a surviving dependent of a deceased law enforcement officer is entitled to receive payments for health insurance premiums from public monies of the employer of the law enforcement officer if the law enforcement officer was killed in the line of duty or died from injuries suffered in the line of duty.

B. The employer shall make payments if the surviving spouse or surviving dependent is enrolled or was enrolled at the time the law enforcement officer was killed in the line of duty or died from injuries suffered in the line of duty in either:

1. The health insurance program of the employer.

2. The health insurance program that is offered by the state retirement system or plan from which the surviving spouse or surviving dependent is receiving benefits.

C. If a surviving spouse or surviving dependent was enrolled in either health insurance program described in subsection B of this section at the time the law enforcement officer was killed in the line of duty or died from injuries suffered in the line of duty and is eligible pursuant to subsection D of this section to receive health insurance premium payments under this section but is no longer enrolled in either health insurance program described in subsection B of this section, the employer shall allow the surviving spouse and any surviving dependent to enroll in the employer's health insurance program to receive health insurance premium payments pursuant to this section.

D. The health insurance premium amount payable by the employer of the deceased law enforcement officer is the amount the employer of the deceased law enforcement officer would pay for an active law enforcement officer for a family coverage premium or single coverage premium, whichever is applicable. If a surviving spouse remarries, family coverage shall include coverage for the additional new family members. Payments shall be discontinued pursuant to this section if any of the following occurs:

1. The surviving spouse remarries.

2. 1. The surviving spouse becomes medicare eligible.

3. 2. The surviving spouse dies.

4. 3. For dependent coverage, the person is no longer considered a dependent.

E. If the employer currently pays a greater portion of the health insurance premium for a surviving spouse or a surviving dependent than the required amount prescribed in subsection D of this section, the surviving spouse or surviving dependent shall receive the greater amount as payment toward the surviving spouse's or surviving dependent's health insurance premium.

F. This section applies:

1. To a surviving spouse or a surviving dependent of a deceased law enforcement officer, as defined in subsection G, paragraph 2, subdivision (a), (b) or (c) of this section, who was killed in the line of duty or who died from injuries suffered in the line of duty on or after April 5, 1933.

2. To a surviving spouse or a surviving dependent of a deceased law enforcement officer, as defined in subsection G, paragraph 2, subdivision (d) of this section, who was killed in the line of duty or who died from injuries suffered in the line of duty on or after April 5, 2013.

3. For the surviving spouse or the surviving dependent who qualifies pursuant to paragraph 1 of this subsection, only to health insurance premiums paid on or after September 13, 2013.

G. For the purposes of this section:

1. "Dependent" means an unmarried child of a deceased law enforcement officer who meets one of the following qualifications:

(a) Is under eighteen years of age.

(b) Is at least eighteen years of age and under twenty-three years of age only during any period that the child is a full-time student.

(c) Is under a disability that began before the child attained twenty‑three years of age and remains a dependent of the surviving spouse or a guardian.

2. "Law enforcement officer" means:

(a) A peace officer who is certified by the Arizona peace officer standards and training board.

(b) A detention officer or corrections officer who, other than a juvenile detention officer, is employed by this state or a political subdivision of this state.

(d) A corrections officer or firefighter who works on behalf of this state or a political subdivision of this state through a contract with a private company. END_STATUTE