Sponsor: Representative Lovas
Overview: HB 2608 closes the Elected Officials Retirement Plan (EORP) and places future elected officials in the Elected Officials' Defined Contribution Retirement System (EORS).
League Position: SUPPORT -The League supports the bill because it will reduce the burden of rising pension costs place on taxpayers while creating a sustainable retirement plan for participating elected officials.
Summary: Establishes EORS under the Arizona State Retirement System for future elected officials, which must be a qualified government plan under § 401(a) of the IRC, exempt from taxation under § 501 of the IRC. Active, retired, and disabled members of the EORS may participate in group health and accident coverage administered by ADOA. Those not receiving coverage under ADOA, may participate in group health and accident coverage through ASRS.
From July 1, 2013 until June 30, 2043, employers must contribute 23.5% of payroll for all employees who are members of EORP or EORS to pay the costs and unfunded liability of EORP and contribute to each EORS member account.
EORS members must contribute 8% of gross compensation into EORS. Additionally, both EORS employees and employers will contribute to the Long-Term Disability Plan.
Defines members of EORS as elected officials of the state and each county, justices of the supreme court, judges of the court of appeals, judges of the superior court, and elected officials of an incorporated city or town whose employer has executed a proper joinder agreement who are elected or appointed on or after July 1, 2013 and who are not members of EORP on June 30, 2013.
02/19/13: The bill passed out the House Insurance and Retirement Committee on a 5-3 vote. The bill was amended to annually appropriate $3.5 M from the state general fund in FY 2013 to 2014 through FY 2042 to 2043 to EORP to amortize the unfunded, accrued liability to the plan. The bill now proceeds to the House Appropriations Committee.
02/28/13: HB 2608 passed out of the House on vote of 35-22. The bill was amended in COW with a floor amendment by Representative Lovas that moves future superior court commissioners to the EORS.
03/20/13: HB 2608 passed out of the Senate Finance Committee on a 4-3 vote with 1 not voting. The bill proceeds to Senate Rules next.
05/02/13: HB 2608 was amended in Senate Committee of the Whole. The amendment allows newly elected officials who are currently enrolled in ASRS the option of staying in ASRS. The League supports the amendment. The bill awaits Senate Third Read.
05/08/13: HB 2608 passed the Senate on reconsideration by a vote of 16-13. The bill returned to the House where the sponsor concurred with Senate amendments. The bill will now proceed to a final vote in the House.