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ARIZONA STATE SENATE
Fifty-Fifth Legislature, Second Regular Session
appropriations; unfunded liability; corrections; safety
Purpose
Appropriates $896,443,500 from the state General Fund (state GF) in FY 2022 to the Public Safety Personnel Retirement System (PSPRS) to reduce the unfunded accrued liability of outlined employer accounts.
Background
Established in 1968, PSPRS provides a uniform, consistent and equitable statewide retirement program for public safety personnel who are regularly assigned hazardous duties in the employ of the State of Arizona or a political subdivision. PSPRS functions as either a defined benefit plan or a defined contribution plan (A.R.S. § 38-841).
Established in 1986, the Corrections Officer Retirement Plan (CORP) provides retirement and disability benefits for correctional officers and employees as well as county, city or town detention officers, dispatchers, probation officers and surveillance officers (A.R.S. § 38-881).
As of June 30, 2021, the funded status of the PSPRS Department of Public Safety (DPS) Group is 69.2 percent and the Arizona Department of Corrections (ADC) CORP Group is 78.8 percent (PSPRS).
S.B. 1087 appropriates $896,443,500 from the state GF in FY 2022 to PSPRS.
Provisions
1. Appropriates $421,859,400 from the state GF in FY 2022 to PSPRS to be deposited in the employer account of the DPS PSPRS Group to reduce the unfunded accrued liability.
2. Appropriates $474,584,100 from the state GF in FY 2022 to PSPRS to be deposited in the employer account of the ADC CORP Group to reduce the unfunded accrued liability.
3. Requires the PSPRS Board of Trustees (Board) to account for the appropriations in the June 30, 2022, actuarial valuation of both the DPS and ADC Groups.
4. Requires the Board to account for the appropriations when calculating employee and employer contribution rates for the DPS and ADC Groups in FY 2024.
5. Becomes effective on signature of the Governor.
Prepared by Senate Research
January 21, 2022
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