SB 1365 Arizona Senate · 57th Legislature - First Regular Session

PSPRS; member contributions

SB 1365 amends Arizona's Public Safety Personnel Retirement System (PSPRS) to establish contribution rates for public safety employees. It requires members hired before July 1, 2017, to contribute 7.65% to 11.05% of their salary (increasing annually), while members hired on or after that date have separate, higher rates. The bill also outlines employer contribution obligations, late payment penalties (10% annual penalty), and rules for transferring funds from prior retirement systems. These changes directly affect current and future public safety employees covered by PSPRS.

Bill status in committee 1 of 4 stages cleared

Introduction

Feb 2025

Committee Review

Floor Vote

Governor

Introduced Feb 3, 2025 Last action Feb 17, 2025

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What changed between versions

Introduced Version → Senate Engrossed Version · 6 edits

MODERATE

This bill updates Arizona's Public Safety Personnel Retirement System (PSPRS) contribution rules, primarily establishing a new risk-pooling mechanism for post-2017 hires and resetting member contribution rates to 7.65% effective July 1, 2023. The changes aim to stabilize funding by shifting some unfunded liability costs to employers while capping member contributions, and introduce stricter timelines for employer contribution payments with penalties for late deposits.

Scope change

The bill applies to all PSPRS members hired on or after July 1, 2017, creating a new risk-pool structure for public safety employers and separate contribution calculations for non-risk-pool employers.

FISCAL

Established a new contribution structure for members hired on or after July 1, 2017, with employers paying 50% of normal costs and unfunded liabilities, and members paying the remaining 50% (capped at 9.5% of compensation).

Reset member contribution rates to 7.65% of compensation effective July 1, 2023, reversing previous increases that reached 11.65%.

REQUIREMENT

Added a 10-day deadline for employers to transfer contributions to the board, with a 10% annual penalty for late payments.

Introduced new subsections M through P regarding amortization period elections, state employer exclusions, and liability transfer rules for reemployed members.

ENFORCEMENT

Created new provisions allowing the board to recover delinquent payments through court action or deduction from state funds.

TIMELINE

Extended the effective date of the act to June 30, 2026, providing a transition period for implementation.

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Committee

Feb 17, 2025

Upper · Passed

upper

1 primary · 0 co-sponsors