ARIZONA STATE SENATE
Phoenix, Arizona
ASRS; benefits;
graded multiplier.
Purpose
Provides for a graduated retirement formula multiplier method of calculating benefits based on years of service for Arizona State Retirement System (ASRS) members.
Currently, a retired member’s monthly compensation is calculated by the member’s years of service multiplied by 2.1 percent. This was last changed in 1998 (Laws 1998, Ch. 327) when the retirement formula multiplier was increased from 2.0 percent to the present 2.1 percent, giving all defined benefit ASRS members and retirees a five percent monthly compensation increase. According to ASRS administrators, a graded multiplier would reward longer service and may aid in retaining employees.
S.B. 1512 is identical to H.B. 2048. The fiscal note for H.B. 2048 states that there will be a total fiscal impact of $40.2 million in FY 2004, which includes $29.5 million from the state general fund and $10.7 million from other appropriated funds
1. Establishes a graduated retirement multiplier that begins at 2.1 percent for members with less than 15 years of service, and increases as follows:
·
2.2
percent if the member has 15 or more years of service but less than 18 years.
·
2.3
percent if the member has 18 or more years of service but less than 22 years.
·
2.4
percent if the member has 22 or more years of service but less than 25 years.
·
2.5
percent if the member has 25 or more years of service.
2. Caps the member’s monthly compensation at 80 percent of the member’s average monthly compensation if the person becomes a member on or after June 30, 2002.
3. Provides for a one-time permanent increase, using the same graduated multiplier, to current retired defined benefit ASRS members.
4. Contains a delayed effective date of June 30, 2002.
Prepared by Senate Staff
February 7, 2001