Bill to add retirement trustees falls short four votes in Senate

A bill that would increase the number of Arkansas Public Employees Retirement System trustees from nine to 13 by adding four trustees to represent retired members failed to clear the Arkansas Senate on Tuesday afternoon.

The Senate’s 14-16 vote on House Bill 1283 by Rep. Les Warren, R-Hot Springs, fell four votes short of the 18 required for approval in the 35-member Senate. Sens. Linda Chesterfield, D-Little Rock; Missy Irvin, R-Mountain View; Jason Rapert, R-Conway; and Terry Rice, R-Waldron were recorded as not voting on the bill and Sen. Mat Pitsch, R-Fort Smith, voted present.

The Senate later expunged the vote to clear the way for another vote on the bill.

The retirement system is state government’s second-largest such agency with more than 75,000 working and retired members, and roughly $10 billion in investments.

Sen. Bill Sample, R-Hot Springs, told senators that the Legislature’s Joint Committee on Public Retirement and Social Security Programs frequently heard during 11 meetings across the state in the fall of 2019 that the system’s retired members “felt they did not have adequate representation on their board and they asked us to do something about it.”

Sample said he and Warren wanted to make sure there was an odd number of board members to prevent tie votes on decisions, and several groups asked for representation on the board, so they decided it would be fair to ask the state employees, counties and municipal groups to recommend appointments to the board.

“This bill is merely taking into consideration the requests from the membership of [the Arkansas Public Employees Retirement System],” he said.

Act 311 of 2017 limited the system’s board of trustees to two retired members, one representing state employees and the other representing local government employees. The law subsequently led Republican Gov. Asa Hutchinson to replace three retired state employees on the board with a former state senator, who is a retired state employee, and two state agency directors.

Under HB1283, the four new trustees would be system retirees.

The new members would be a retired state employee appointed by the executive director of the Arkansas State Employees Association and approved by the association’s board of directors; a retired county employee appointed by the executive director of the Association of Arkansas Counties and approved by the association’s board of directors; a retired former municipal employee appointed by the executive director of the Arkansas Municipal League and approved by the league’s executive committee; and a retired law enforcement officer from a nonmanagerial position to be appointed by the Senate president pro tempore and House speaker.

Under current state law, the governor appoints three state employees and three non-state employees to the board, which also includes the state auditor, state treasurer and secretary of the Department of Finance and Administration. The governor appoints the secretary of the finance department.

HB1283 also would require the three non-state employee trustees to include at least one county judge and at least one mayor.

Sen. Mark Johnson, R-Ferndale, questioned whether the bill would run into some constitutional problems by delegating appointments to officials of private non-profit organizations.

Sample said he doesn’t believe there would be any problems.