ARIZONA STATE SENATE
Phoenix, Arizona
CORRECTED
REVISED
CORP; members; normal
retirement
Makes numerous changes to
the Corrections Officer Retirement Plan (CORP).
CORP was created by Laws 1986 Chapter 325 in order to establish an adequate retirement package with which to attract and retain Corrections employees. Prior to 1986, Corrections Officers and employees now in CORP were covered by the Arizona State Retirement System (ASRS). Currently, in order to qualify for normal retirement, a CORP member must have 25 years of service, or reach age 62 with 10 years of service or have any combination of age and credited service equaling 80. A CORP member’s normal retirement pension is calculated by multiplying 2.5 percent of the average compensation by the number of years of service up to 30 years, not to exceed 75 percent of the member’s average compensation. CORP is funded in part by an employer-employee matching program, which is currently set at 8.5 percent of the employee’s monthly average compensation. According to the Department of Corrections, the changes in this bill relating to CORP are needed to improve the recruitment and retention of Corrections employees and administrators.
According to Joint
Legislative Budget Committee staff, in FY 2003-2004, there will be a total
fiscal impact of $4.4 million, of which $4.3 million is from the state general
fund and $29,700 is from other appropriated funds.
1. Decreases from 25 to 20 years the number of years of credited service necessary to qualify for normal retirement.
2. Specifies that if a member has less than 20 years of credited service the retirement benefit is calculated using the current formula, and if a member has 20 years or more service then the benefit is calculated at 50 percent of the member’s average monthly salary. Additionally, the member’s monthly benefit shall increase as follows:
·
For
20-24.9 years of service, 2 percent multiplied by each year, or fraction of a
year, in excess of 20 years; and
·
For
25 or more years of service, 2.5 percent multiplied by each year, or fraction
of a year, in excess of 20 years.
3. Enables employers of full-time dispatchers who are employed by an employer that has members in the PSPRS to elect to come into CORP.
4. Provides a joinder agreement to allow employers of full-time dispatchers to become members of CORP.
5. Eliminates the requirement that the Director and assistant directors of the Department of Juvenile Corrections and the Superintendent of the State Educational System for Committed Youth be hired after July 1, 1992 in order to participate in CORP.
6. Eliminates the requirement that the Director, deputy directors and assistant directors of the Department of Corrections be hired after July 1, 1998 in order to participate in CORP.
7. Removes the 30-year cap when calculating a member’s pension.
8. Increases the pension cap from 75 percent to 80 percent of the member’s monthly salary.
9. Requires each participating employer of full-time dispatchers to have a board to administer CORP.
10. Specifies that unless written consent to the contrary is received from the fund manager within 60 days after the effective date of this act, certain eligible Corrections personnel will become members of CORP on the effective date of this act.
11. Transfers assets, on behalf of those who become members of CORP, from the ASRS to the CORP fund, consisting of the total amount of the member’s employee and employer contributions together with any supplemental credits and interest accrued.
12. Makes technical and conforming changes.
13. Provides for a general effective date.
Amendments Adopted by Committee
1. Adds a joinder agreement on behalf of dispatchers.
2. Makes technical changes.
Senate Action
FIN 1/22/01 DPA 6-2-0-0
Prepared by Senate Staff
January 30, 2001