Bill on state police retirement backed
Joint panel supports credit at 28 years
A legislative committee on Monday endorsed a bill that would allow members of the Arkansas State Police Retirement System to retire at any age after 28 years of service, two years fewer than now allowed.
The Joint Committee on Public Retirement and Social Security Programs also recommended a bill that would increase the amount that colleges and universities may spend on early retirement incentives for employees.
But the committee balked at legislation that would require the forfeiture of public retirement benefits when a public employee is convicted of or pleads guilty to a felony offense related to his office’s duties.
STATE POLICE
Rep. Les Warren, R-Hot Springs, sponsors House Bill 1343 on the Arkansas State Police Retirement System. He said he and Sen. Jason Rapert, R-Conway, worked with Department of Public Safety Secretary Jami Cook and the Arkansas State Police director, Col. Bill Bryant, to “come up with a bill that will take our state police in a positive direction.”
Commissioned troopers are members of the retirement system, which has two tiers of members.
Those hired before April 3, 1997, belong to the tier 1 retirement plan, while those hired on or after that date belong to the tier 2 plan.
Tier 2 has 457 working members with an average age of 38.3, average service of 9.8 years and average salary of $58,002 a year, according to Duncan Baird, who heads the system.
Tier 1 has 25 working members with an average age of 51.1, average service of 23 years and average salary of $81,436 a year.
A member who has more than five years of service, but less than 30 years of actual service, can retire at age 65, Baird said. The age 65 requirement is reduced by 0.75 of a month for each month of actual service, down to age 55, he said.
Warren told lawmakers that HB1343 also would increase the multiplier for tier 1 members from 1.55% to 1.66% to use in calculating retirement benefits and the multiplier for tier 2 members from 2.475% to 2.65%.
He said the bill would require the Division of Arkansas State Police to increase its contributions to the retirement system at 26% of members’ payroll, up from 22%, to cover about $700,000 of the $1.2 million projected increase in annual retirement costs.
Gov. Asa Hutchinson “also has committed to an additional amount of $530,000 to cover the difference,” Warren said.
“The big key in all of this is that the multiplier will be adjusted to allow for a retiring state police officer or member to receive the same credit at 28 years that they would have had had they retired at 30 years,” he said. “Our Arkansas State police officers will get to retire two years earlier at the same retirement pay.
“Our state police officers put their lives on the line every day,” Warren said. “This is a move that I believe we owe them.”
Most surrounding states allow their state troopers to retire after 25 years of service at any age, and “we need to do this to be competitive for good troopers,” he said.
Hutchinson originally proposed reducing the service requirement for retiring at any age from 30 years to 28 years for tier 2 members, but not for tier 1 members.
He said Monday that “the changes are a result of the give and take of the legislative process.
“There were some members who wanted to reduce the retirement age even further. A lower retirement age is not affordable, but the adjustment for Tier 1 was doable,” he said in a written statement.
EARLY RETIREMENT
Warren said his House Bill 1299 would allow higher-education institutions to use up to 5% of their aggregate personnel costs during the previous fiscal year to provide early retirement incentives for both tenured and non-tenured employees, up from the current limit of up to 1%.
“This is not new money, just reallocation of funds being allotted for specific purposes for institutions of higher education,” he told the committee.
“This move should lead to cost savings as the end result will be to eliminate some of the higher-salaried individuals both tenured and non-tenured,” Warren said.
This bill offers early retirement incentives to employees who are one year away from retirement, he said.
Julie Bates, chief financial officer for the Arkansas State University System, told lawmakers that if an employee opts to retire, “then that allows the institution to restructure their positions and possibly not refill a position or refill it with a new person just coming into the job market,” she said. “It is a kind of a win-win for the employee and for the institution.”
FORFEITING BENEFITS
Senate Bill 231, by Sen. Mark Johnson, R-Ferndale, on forfeiting benefits of convicted public employees, would allow a prosecutor to give notice to a retirement system to suspend the benefits if they have reasonable cause to believe the member will be charged with one of these crimes, committee actuary Jody Carreiro said.
The bill also includes provisions for refunding member contributions and restoring benefits if the person is pardoned or the conviction is overturned.
Rep. Jay Richardson, D-Fort Smith, who is the House sponsor of SB231, made a motion for the retirement committee to recommend approval of the bill and no one seconded his motion, so the bill died in committee.
Warren said attorneys draft trust documents that are designed to protect the beneficiaries of these trusts, so “I felt like we are violating the beneficiaries’ rights with this bill.
“I understand this is being done in other states, but I also don’t want the state in a costly battle,” he said.
Johnson said the bill is aimed at penalizing state employees and elected officials who violated their oath of office and the public trust and “are not entitled to the benefit that the many, many, many good people out there that have served their state well and kept their nose clean and never succumbed to the temptation for corruption.
“The principle is that the bad guys shouldn’t be rewarded with a lifetime pension from the state of Arkansas.”