 |
ARIZONA STATE SENATE
Fifty-Seventh Legislature, First Regular Session
AMENDED
PSPRS; part-time employment
Purpose
Allows, beginning July 1, 2026, part-time municipal police officers, state highway patrol officers and county sheriffs and deputies who are engaged to work as patrol officers and who meet other specified requirements to participate in the Public Safety Personnel Retirement System (PSPRS) and receive credited service for the part time service, if the employer has chosen to allow part-time employees to participate and the part-time work is for a maximum period of six years due to specified qualifying events. Exempts school resource officers (SROs) from limitations on receiving pensions payments from PSPRS after retiring and subsequently becoming reemployed.
Background
PSPRS provides a uniform, consistent and equitable statewide retirement program for Arizona’s municipal firefighters and police, highway patrol and other public safety personnel. Municipal police officers, state highway patrol officers and county sheriffs and deputies who are certified peace officers are eligible to participate in PSPRS if the employee’s customary employment is at least 40 hours per week for more than six months in a calendar year and the employee is regularly assigned to hazardous duties.
Retirement benefits are determined by member salaries and credited service during employment. Credited service means the member's total period of service before the member's effective date of participation, plus those compensated periods of service thereafter for which the member made contributions to the PSPRS Fund (A.R.S. §§ 38-841 and 38-842).
Statute requires certain conditions to apply if a member of PSPRS retires and then becomes reemployed in any capacity by the employer from which the member retired within six months after the date of retirement or becomes reemployed in the same position at any time following retirement. These conditions include: 1) within 10 days after the retired member is reemployed, the local board must advise PSPRS in writing of the retired member's reemployment; 2) PSPRS must not make pension payments to the retired member during the period of reemployment; and 3) any pension payments received by the retired member during the period of reemployment are considered overpayments and may be subject to repayment. However, these conditions do not apply in certain circumstances, including if the retired member is hired as a fire inspector or arson investigator (A.R.S. § 38-849).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Exempts a PSPRS member who is reemployed as an SRO from limitations on receiving pension payments from PSPRS after retiring.
2. Includes, in the definition of a PSPRS member beginning July 1, 2026, any part-time employee whose employer has chosen to allow part-time employees to participate in PSPRS and to whom all the following apply:
a) the member is hired as a municipal police officer, state highway patrol officer or county sheriff or deputy and is also a certified peace officer;
b) the member has at least three years of credited service in PSPRS or the PSPRS Defined Contribution Plan before being hired as a part-time employee; and
c) the member is engaged to work as a patrol officer and is scheduled to work between 20 hours and 30 hours per week following a consistent schedule, as determined by the employer.
3. Requires a part-time employee, in order to qualify as a part-time PSPRS member, to:
a) have entered into a written agreement with the employer before July 1, 2031, to work part time for a period of up to three years due to the birth or adoption of a child or to provide care for a serious health condition of an immediate family member; and
b) have not worked as a part-time employee due to the outlined circumstances for more than six years.
4. Requires the average monthly benefit compensation to exclude part-time earnings for the purposes of calculating an accidental, ordinary or catastrophic disability pension for a patrol officer that meets the requirements of a part-time member.
5. Requires, for a qualifying part-time PSPRS member who is determined to be eligible for an accidental, ordinary or catastrophic disability pension before the member's normal retirement date, the PSPRS actuary to determine, and PSPRS to assess the employer, an amount that equals the actuarial present value of future benefit payments already accrued, calculated as of the member's disability retirement date.
6. Prohibits a part-time employee from performing off-duty work.
7. Includes, in the definition of credited service, those compensated periods of a member's part time service, calculated on a pro rata basis, during which the member made contributions to the PSPRS Fund.
8. Defines off-duty work as being employed as a police officer, state highway patrol officer or county sheriff or deputy by an employer other than the part-time employee's PSPRS employer.
9. Defines terms.
10. Makes conforming changes.
11. Becomes effective on the general effective date.
Amendments Adopted by Committee
1. Delays, from January 1, 2026, to July 1, 2026, the part-time employment authorization.
2. Modifies the definition of a PSPRS member:
a) by requiring a part-time employee to have had at least three years, rather than five years, of credited service before being hired as a part-time employee; and
b) by narrowing eligibility for part-time service to members engaged to work as patrol officers.
3. Requires a part-time employee, in order to qualify as a part-time PSPRS member, to enter into a part-time work agreement with the employer before July 1, 2031, due to a specified qualifying event for a maximum period of six years.
4. Prohibits a part-time employee from performing off-duty work.
Amendments Adopted by Committee of the Whole
1. Specifies that the part-time patrol officer must be scheduled to work between 20 hours and 30 hours per week following a consistent schedule, in addition to meeting the other outlined requirements.
2. Requires the average monthly benefit compensation to exclude part-time earnings for the purposes of calculating an accidental, ordinary or catastrophic disability pension for a patrol officer that meets the requirements of a part-time member.
3. Makes technical and conforming changes.
Amendments Adopted by the House of Representatives
1. Exempts SROs from limitations on receiving pensions payments from PSPRS after retiring and subsequently becoming reemployed.
2. Adds requirements for PSPRS when a qualifying part-time PSPRS member becomes eligible for an accidental, ordinary or catastrophic disability pension.
3. Makes technical changes.
Senate Action House Action
FIN 2/17/25 DPA 6-1-0 PSLE 3/24/25 DPA 12-1-1-1
3rd Read 3/13/25 24-3-3 3rd Read 5/5/25 35-22-3
Prepared by Senate Research
May 6, 2025
MG/ci