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ARIZONA STATE SENATE
Fifty-Seventh Legislature, First Regular Session
state retirement systems; digital assets
Purpose
Expresses the Legislature's encouragement for the Arizona Retirement System (ASRS) and Public Safety Personnel Retirement System (PSPRS) to monitor the development of Bitcoin exchange traded funds (ETFs) and other digital asset ETFs and consider the implications of investing in Bitcoin ETFs and other digital asset ETFs.
Background
ASRS was established in 1953 to: 1) provide an incentive in the recruitment and retention of employees; 2) contribute toward providing a compensation package that is generally equivalent to comparable employment across Arizona; 3) provide a retirement system that encourages employees to remain in service for periods of time that will provide public employers with the full benefit of the training and experience gained by the employees; 4) provide an orderly method of promoting and maintaining a high level of service to the public; and 5) provide a base retirement benefit that is less than 100 percent of a member's post-retirement income requirements, recognizing the equal contributions between the employee and employer. The ASRS Board has statutory authority to allocate assets and use investment strategies to meet the investment goals and policies ASRS prescribes (A.R.S. §§ 38-712 and 38-718).
PSPRS was established in 1968 as a uniform, consistent and equitable statewide retirement program for public safety personnel who are regularly assigned hazardous duty in the employment of the state or its political subdivisions. PSPRS provides retirement benefits for municipal firefighters and police, the Arizona highway patrol and other public safety personnel. The PSPRS Board of Trustees (PSPRS Board) has statutory authority to invest and reinvest, alter and change the monies accumulated under PSPRS and other PSPRS Board-administered retirement plans and trusts at the PSPRS Board's discretion (A.R.S. §§ 38-802; 38-841; 38-848; and 38-882).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
· Encourages ASRS and PSPRS to:
a) closely monitor the developments of Bitcoin ETFs and other digital asset ETFs;
b) consider the implications of including Bitcoin ETFs and digital asset ETFs in the ASRS and PSPRS investment portfolios after consulting with any firms that have been granted U.S. Securities Exchange Commission approval to offer digital asset ETFs; and
c) submit a comprehensive report on the feasibility, risk and potential benefits of directing a portion of state retirement system monies into digital asset ETFs to the State Treasurer, President of the Senate and Speaker of the House of Representatives at least three months before the beginning of the Fifty-Seventh Legislature, Second Regular Session.
Prepared by Senate Research
January 22, 2025
MG/KP/ci