PUBLIC SAFETY PERSONNEL RETIREMENT SYSTEM 3010 East Camelback Rad, Suite 200 Phenix, Arizna 85016-4416 www.psprs.cm Telephne: (602) 255-5575 Fax: (602) 255-5572 11/2014 SUMMARY OF BENEFITS Summary Tpics Average Mnthly Benefit Cmpensatin Benefit Increase Cancer Insurance Cntributins Credited Service Death Benefits Disabilities Divrce / Dmestic Relatins Order DROP (Deferred Retirement Optin Plan) Eligibility Health Insurance Jinders Purchase f Handgun r Shtgun Refund Retirement and Deferred Annuity Return t Wrk after Retirement Service Purchase Taxatin f Retirement Benefits Transfers Average Mnthly Benefit Cmpensatin Emplyees wh became a member f the System n r befre December 31, 2011: An average f yur highest thirty-six (36) cnsecutive mnths f cmpensatin (salary) within the last twenty (20) years f credited service A.R.S. 38-842 (7). Emplyees wh became a member f the System n r after January 1, 2012: An average f yur highest sixty (60) cnsecutive mnths f cmpensatin (salary) within the last twenty (20) years f credited service. A.R.S. 38-842 (7). Cmpensatin includes base wages, shift and military differential wage pay, cmpensatry time used by an emplyee in lieu f vertime nt therwise paid by an emplyer, hliday and vertime pay that is paid t an emplyee by the emplyer fr the emplyee s perfrmance f services in an eligible grup n a regular mnthly, semi-mnthly, r biweekly payrll basis as well as any lngevity pay paid t an emplyee at least every six mnths fr which cntributins are made t the system. Fr the purpses f cmputing retirement benefits, cmpensatin des nt include unused sick leave, unused cmpensatry time, payment in lieu f vacatin, fringe benefit pay (such as unifrm allwance, cell phne r mileage reimbursement) and any payments made directly r indirectly by the emplyer t the emplyee fr wrk perfrmed fr a third party n a cntracted basis except fr third party cntracts in certain situatins. A.R.S. 38-842(12). 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 1 f 11
Benefit Increase A retired member r survivr f a retired member may receive a benefit increase frm the System if mnies are available. See A.R.S. 38-856, 38-856.02. 2014 Permanent Benefit Increase (PBI) Amunts If RETIRED n r befre 7/1/2011 - ARS 38-856 ( OLD Law) plus retired fr 2 years (by July 1), r age 55 and retired fr 1 year (by July 1) PSPRS $65.20 mnthly increase Based n mnies available in reserve accunt If RETIRED n r after 8/1/2011 - ARS 38-856.02 ( NEW Law), and If membership (hire) date with current emplyer was befre 1/1/2012 plus retired fr 2 years (by July 1), r age 55 and retired fr 1 year (by July 1) If membership (hire) date with current emplyer was after 1/1/2012 plus age 55 by July 1, r if receiving a survivr/disability retirement fr 2 years (by July 1) Investment return based n prir fiscal year and current funding PSPRS N increase available status f the System If a retiree qualifies fr an increase under the New Law 38-856.02, the percentage increase will be calculated based n the earnings that are available: If the rati f the actuarial value f assets t liabilities is 60-64% and the ttal return is mre than 10.5% fr the prir fiscal year, 2% maximum increase t all eligible retirees and survivrs. If the rati f the actuarial value f assets t liabilities is 65-69% and the ttal return is mre than 10.5% fr the prir fiscal year, 2.5% maximum increase t all eligible retirees and survivrs. If the rati f the actuarial value f assets t liabilities is 70-74% and the ttal return is mre than 10.5% fr the prir fiscal year, 3% maximum increase t all eligible retirees and survivrs. If the rati f the actuarial value f assets t liabilities is 75-79% and the ttal return is mre than 10.5% fr the prir fiscal year, 3.5% maximum increase t all eligible retirees and survivr. If the rati f the actuarial value f assets t liabilities is 80% r mre and the ttal return is mre than 10.5% fr the prir fiscal year, 4% maximum increase t all eligible retirees and survivrs Frm and after December 31, 2015, legislature may enact permanent ne-time benefit increases after an analysis f the effect f the increase n the System by the Jint Legislative Budget Cmmittee (JLBC). A.R.S. 38-856.03. Cancer Insurance A cancer insurance prgram is administered by the PSPRS/CP fr eligible fire fighters, certified peace fficers, crrectins fficers r detentin fficers. A.R.S. 38-641 thrugh 38-645. Cntributins Frm July 1, 2014 thrugh June 30, 2015, each member shall cntribute 11.05% f cmpensatin t the System n a pre-tax basis by payrll deductin. The cntributin rate fr members will change each fiscal year. A.R.S. 38-843(E). A member may nt, under any circumstance, brrw frm, take a lan against r remve cntributins frm the member s accunt befre the terminatin f membership in the plan r the receipt f a pensin. A.R.S. 38-843(C). A Cunty emplyer that elected t pay a higher level percentage cntributin rate may eliminate that higher level percentage cntributin rate amunt fr members wh are hired n r after January 1, 2015. A.R.S. 38-843 (B). 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 2 f 11
Credited Service The member s ttal perid f service fr which the member made cntributins t the PSPRS. A.R.S. 38-842(13). Death Benefits Pursuant t statutes, an AUTOMATIC survivr benefit will pay yur eligible spuse* and eligible child(ren)**. If there is n eligible spuse r eligible child(ren), the balance f the applicable cntributins, if any, will be paid t the named beneficiary(ies) n file. If there is n beneficiary, yur Lcal Bard will determine the next-f-kin, r estate. A.R.S. 38-846(I). * Prf f recrded marriage license/certificate with the Clerk f the Curt r Cunty Clerk will be required. Failure t prvide it may affect the cntinuatin f health insurance and surviving spuse benefits. If yu are receiving a mnthly benefit, statute requires tw (2) cnsecutive years f marriage. ** Definitin f an eligible child is unmarried, under the age f 18, and/r attending full-time schl between the ages f 18 t 23, plus disabled child(ren) if disability ccurred befre the age f 23 and wh is(are) a dependent f the member. Nte: Divrce autmatically terminates the ex-spuse as the member s beneficiary. T maintain an ex spuse as a beneficiary, yu must cmplete a Beneficiary Designatin Frm and/r a DROP Beneficiary Designatin Frm, as applicable, after the date f the divrce. Depending if yu are wrking, inactive, retired, r DROP, read belw fr additinal details. ACTIVE Member Spuse s Pensin The surviving spuse f an active member will receive a Spuse s Pensin each mnth fr lifetime. The Spuse s Pensin is 80% f the pensin based n the calculatin fr an accidental disability retirement. If the member was killed in the line f duty, the spuse will receive a lifetime mnthly benefit f 100% f the member s average mnthly benefit cmpensatin less the Child s Pensin stated belw (if applicable). A.R.S. 38-846. AND Child s Pensin The surviving eligible child(ren) will receive a Child s Pensin up t 20% (in equal shares, but n mre than 10% per eligible child) each mnth based n the calculatin fr an accidental disability retirement until each (unmarried) child turns 18, r under 23 years f age nly during any perid that the (unmarried) child is a full-time student. An eligible Child s Pensin shall becme payable directly t the eligible child when the eligible child reaches the age f 18, if the child remains eligible t receive the pensin and is nt subject t a guardianship r cnservatrship due t disability r incapacity. A.R.S. 38-842(23) and 38-846. Guardian Benefit If there is n surviving spuse, r the pensin f the surviving spuse is terminated, and there is at least ne (1) eligible child, a Guardian Benefit f 80% (based n the calculatin fr a Spuse s Pensin) and the applicable Child s Pensin (based n the calculatin fr a Child s Pensin) will be paid t the guardian f the (unmarried) eligible child(ren) until the child turns 18, r under 23 years f age nly during any perid that the (unmarried) child is a full-time student. If a Guardian Benefit is paid t a disabled child (the child s disability ccurred prir t the age f 23) and remains a dependent f the guardian, the benefit is payable t the guardian r cnservatr fr the lifetime f the child. A.R.S. 38-842(23) and 38-846. If the member was killed in the line f duty, the Guardian Benefit is 100% f the member s average mnthly benefit 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 3 f 11
cmpensatin (less the Child s Pensin if applicable). Balance f Cntributins If there is n surviving spuse r eligible child(ren), the member's named beneficiary n file will receive the member s accumulated cntributins. If the surviving beneficiary des nt apply fr the benefit within twelve mnths frm the date f the member s death, the Lcal Bard has the authrity t pay the member s nearest f kin, r estate. A.R.S. 38-846(I). INACTIVE Member (nn-cntributing status at the time f death) Balance f Cntributins If the member was inactive, the member's named beneficiary n file will receive the member s accumulated cntributins. If the surviving beneficiary des nt apply fr the benefit within twelve mnths frm the date f the member s death, the Lcal Bard has the authrity t pay the member s nearest f kin, r estate. A.R.S. 38-842(30) and 38-846(I). RETIRED/DROP Member Spuse s Pensin If married fr at least tw (2) cnsecutive years at the time f the member s death, the surviving spuse will receive a Spuse s Pensin each mnth fr lifetime based n 80% f the member's pensin benefit. A.R.S. 38-846. AND Child s Pensin The surviving eligible child(ren) will receive a Child s Pensin up t 20% (in equal shares, but n mre than 10% per eligible child) each mnth based n the member s pensin until each (unmarried) child turns 18, r under 23 years f age nly during any perid that the (unmarried) child is a full-time student. An eligible Child s Pensin shall becme payable directly t the eligible child when the eligible child reaches the age f 18, if the persn remains eligible t receive the pensin and is nt subject t a guardianship r cnservatrship due t disability r incapacity. A.R.S. 38-842(23) and 38-846. Guardian Benefit If there is n surviving spuse, r the pensin f the surviving spuse is terminated, and there is at least ne eligible child, a Guardian Benefit f 80% (based n the member s pensin) and the applicable Child s Pensin (based n the member s pensin) will be paid t the guardian f the (unmarried) eligible child(ren) until the child turns 18, r under 23 years f age nly during any perid that the (unmarried) child is a full-time student. If a Guardian Benefit is paid t a disabled child (the child s disability ccurred prir t the age f 23) and remains a dependent f the guardian, the benefit is payable fr the lifetime f the child. A.R.S. 38-842(23) and 38-846. Balance f Cntributins If there is n surviving spuse r eligible child(ren), the member's named beneficiary n file will receive the balance f the member's accumulated cntributins less the pensin payments made t the member. If the surviving beneficiary des nt apply fr the benefit within twelve mnths frm the date f the member s death, the Lcal Bard has the authrity t pay the member s nearest f kin, r estate. A.R.S. 38-846(I). 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 4 f 11
DROP Lump-sum Payment DROP Beneficiary As per the DROP Beneficiary Designatin frm n file, the member s named beneficiary will be paid the accrued DROP mnies. A.R.S. 38-844.07. Disabilities Accidental A physical r mental cnditin which ttally and permanently prevents an emplyee frm perfrming a reasnable range f duties within the emplyee's jb classificatin that was incurred in the perfrmance f the emplyee's duties and was nt the result f a physical r mental cnditin r injury that existed r ccurred befre the emplyee s date f membership in the System. A member shall file an applicatin fr a disability pensin after the disabling incident r within ne year after the date the member ceases t be an emplyee. A.R.S. 38-842(1) and 38-844. Eligibility fr an accidental disability will be determined by the Lcal Bard upn an independent medical examinatin. Fr members with a membership date n r befre December 31, 2011, the mnthly benefit is 50% f the member's average mnthly cmpensatin, r the nrmal pensin amunt, whichever is greater. Fr members with a membership date n r after January 1, 2012, the mnthly benefit is 62.5% f the member's average mnthly cmpensatin less a 4% reductin fr each year f credited service under 25 years, r the nrmal pensin amunt, whichever is greater (but nt less than 50% f the average mnthly cmpensatin). (There is n age r credited service requirement.) The Lcal Bard may require peridic medical re-evaluatins and the accidental disability may terminate if the Lcal Bard finds the member n lnger meets the requirements fr the disability benefit and refuses an ffer f emplyment by an emplyer in the system. A.R.S. 38-844 and 38-845. Catastrphic A physical (nt mental) cnditin r injury that ttally and permanently prevents an emplyee frm engaging in any gainful emplyment that was incurred in the perfrmance f the emplyee's duties and that did nt exist r ccur befre the emplyee s date f membership in the System. A member shall file an applicatin fr a disability pensin after the disabling incident r within ne year after the date the member ceases t be an emplyee by reasn f disability. A.R.S. 38-842(9) and 38-844. Eligibility fr a catastrphic disability will be determined by the Lcal Bard upn an independent medical examinatin. The mnthly benefit is 90% f average mnthly benefit cmpensatin fr first 60 mnths then reduced t either 62.5% f the average mnthly benefit cmpensatin, r nrmal pensin amunt, whichever is greater. (There is n credited service requirement.) The Lcal Bard may require peridic medical re-evaluatins and the catastrphic disability may terminate if the Lcal Bard finds the member n lnger meets the requirements fr the disability benefit. A.R.S. 38-844 and 38-845 and Sectin 11. Ordinary A physical cnditin that ttally and permanently prevents an emplyee frm perfrming a reasnable range f duties within the emplyee s department, r a mental cnditin that ttally and permanently prevents the emplyee frm engaging in any substantial gainful activity. The physical r mental cnditin r injury did nt ccur befre the emplyee s date f membership in the System. A member shall file an applicatin fr a disability pensin after the disabling incident r within ne year after the date the member ceases t be an emplyee by reasn f disability. A.R.S. 38-842(34) and 38-844. Eligibility fr an rdinary disability will be determined by the Lcal Bard upn an independent medical examinatin. Fr all members, the mnthly benefit is a percentage f nrmal retirement based n the emplyee s years f credited service (maximum f 20 years) divided by twenty (20). The Lcal Bard may require peridic medical re-evaluatins and the rdinary disability may terminate if the Lcal Bard finds that the member n lnger meets the requirements fr the disability benefit and refuses an ffer f emplyment by an emplyer in the system. A.R.S. 38-844 and 38-845. Temprary A physical r mental cnditin that ttally and temprarily prevents an emplyee frm perfrming a reasnable range f 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 5 f 11
duties within the emplyee's department and that was incurred in the perfrmance f the emplyee's duties. The mnthly benefit is ne-twelfth f 50% f annual cmpensatin at time f disability. (There is n credited service requirement.) The disability pensin will be paid fr n mre than twelve (12) mnths, r if the member returns t wrk, r if the Lcal Bard deems the member is n lnger under temprary disability, whichever ccurs first. The member must terminate emplyment by reasn f disability in rder t receive this benefit. A.R.S. 38-842(47), 38-844 and 38-845. Divrce / Dmestic Relatins Order (DRO) If the member has been invlved in a divrce(s), please prvide the PSPRS with a cmplete cpy f the Divrce Decree(s) and any attachments r exhibits if referenced in the Decree(s). Upn receipt, additinal crrespndence will be prvided t the parties. If the retirement accunt is required t be split, a Dmestic Relatins Order (DRO) will need t be prepared. T ensure that the language in the DRO is acceptable, it is recmmended t prvide the PSPRS with a draft cpy f the DRO fr review and apprval prir t submitting it t the curt. A.R.S. 38-860. DROP (Deferred Retirement Optin Plan) Emplyees wh became a member n r befre December 31, 2011 that have AT LEAST 20 years f credited service n January 1, 2012 and enter int DROP either prir t r after January 1, 2012 may vluntarily and irrevcably enter int the DROP prgram with the emplyer fr a perid f up t sixty (60) mnths (i.e., 5 years). The member s mnthly benefit is calculated based upn the years f credited service and average mnthly cmpensatin at the beginning f the DROP perid and that same amunt is credited t the DROP accunt with interest (subject t change each fiscal year). Currently, the interest rate is 7.85% frm July 1, 2014 thrugh June 30, 2015. Additinally, during the DROP perid, the member remains as a full-time emplyee and cntributins will nt be paid by the emplyee r the emplyer and the emplyee will nt earn any additinal credited service. At the end f the sixty (60) mnths (r prir t that time), the member terminates emplyment and the mnies accrued in DROP will be paid as a lump-sum either directly t the member (less mandated taxes), r as a rllver. The member will then begin receiving the mnthly retirement benefit - which is the same amunt that was calculated at the beginning f DROP. A.R.S. 38-842, 38-844.02 thrugh 38-844.09. Emplyees wh became a member n r befre December 31, 2011 that have LESS THAN 20 years f credited service n January 1, 2012 and enter int the DROP prgram after January 1, 2012, may vluntarily and irrevcably enter int the DROP prgram with the emplyer fr a perid f up t 60 mnths (5 years). The member s mnthly benefit is calculated based upn the years f credited service and average mnthly cmpensatin at the beginning f the DROP perid and that same amunt is credited t the DROP accunt with interest (subject t change each fiscal year equal t the average annual return f the system minimum 2%; maximum assumed earnings rate). The interest rate fr the DROP accunt is 3.4% frm July 1, 2014 thrugh June 30, 2015. A.R.S. 38-842, 38-844.02 thrugh 38-844.09, and 38-844.06(B). Additinally, during the DROP perid, the member remains as a full-time emplyee and cntributins will be paid by the emplyee ONLY (n cntributins will be paid by the emplyer) at the same cntributin rate previusly being paid, but emplyee will nt earn any additinal credited service. At the end f the sixty (60) mnths (r prir t that time), the member terminates emplyment and the mnies accrued in DROP will be paid as a lump-sum either directly t the member (less mandated taxes), r as a rllver. The member will then begin receiving the mnthly retirement benefit - which is the same amunt that was calculated at the beginning f DROP and will als receive the cntributins made t the retirement system during perid f time in DROP, plus interest (subject t change each fiscal year). The interest rate fr the cntributins made during the member s participatin in DROP is 2.0%. A.R.S. 38-842, 38-844.02 thrugh 38-844.09, and 38-844.06(B). Emplyees wh became a member n r after January 1, 2012 are nt eligible t participate in DROP. 38-844.02 and 38-844.03. 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 6 f 11
Eligibility Plice fficers wh are certified peace fficers and fire fighters are eligible t participate in the PSPRS if the emplyee s custmary emplyment is fr at least frty (40) hurs per week fr mre than six (6) mnths in a calendar year and are regularly assigned t hazardus duties. Retractive t January 1, 2009, plice and fire chiefs are eligible t participate in the PSPRS. A.R.S. 38-842 (24 and 31). Health Insurance Pursuant t A.R.S. 38-857, 38-651.01 and 38-782, retirees and eligible survivrs under the System that elect grup health insurance and/r accident insurance cverage thrugh the Arizna State Retirement System grup plan (ASRS), the Arizna Department f Administratin (ADOA) grup plan, r a grup plan thrugh an emplyer f the PSPRS r CP plans, the System will pay up t the fllwing amunt Premium Benefit amunt: Single Premium Benefit Family Premium Benefit Nt Medicare Eligible $150.00/mnth All Nt Medicare Eligible $260.00/mnth Medicare Eligible $100.00/mnth All Medicare Eligible $170.00/mnth One with Medicare $215.00/mnth Emplyees wh retiree n/after September 12, 2013, r their eligible survivrs, will nt be eligible fr the Premium Benefit if they are (re)emplyed and participates in health care cverage prvided by the member s r survivr s new emplyer. A.R.S. 38-857. If a law enfrcement fficer, as defined in A.R.S. 38-1103(E)(2), is killed in the line f duty, the eligible surviving spuse r dependent(s) are entitled t insurance benefits either by the frmer emplyer, r frm the state retirement system frm which the spuse r dependent is receiving benefits. The health insurance premium amunt payable by the emplyer f the deceased law enfrcement fficer is the amunt the emplyer f the deceased law enfrcement fficer wuld pay fr an active law enfrcement fficer fr a family cverage premium r single cverage premium, whichever is applicable. Fr additinal eligibility requirements, refer t A.R.S. 38-1103. Jinders Specific psitins and emplyers may participate in the PSPRS if the gverning bdy f the emplyer enters int a jinder agreement t bring such emplyees int the PSPRS. The jinder agreement shall be in accrdance with the prvisins f this System. Assets under any existing public emplyee defined benefit retirement prgram shall be transferred t the PSPRS within sixty (60) days after the emplyer s effective date. A.R.S. 38-851. Purchase f Handgun r Shtgun Upn retirement and subject t apprval by the emplyer, the PSPRS retiree may purchase the handgun r shtgun issued by the emplyer t the emplyee at less than fair market value. A.R.S. 38-845(H). Refund Emplyees wh became a member n r befre December 31, 2011, pursuant t A.R.S. 38-846.02 (A and B), upn terminatin f emplyment (fr any reasn ther than death r retirement) within twenty (20) days after filing an applicatin with the PSPRS, the member will receive a lump-sum payment f accumulated cntributins (less any benefits paid r any amunts wed t the System) - thus, frfeiting all membership rights and credited service in the System upn receipt f refund f cntributins. If the member has five (5) r mre years f credited service, an 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 7 f 11
additinal percentage f cntributins will be refunded t the member accrding t the member s years f service as stated belw: 5 t 5.9 years f service = 25% f additinal member cntributins 6 t 6.9 years f service = 40% f additinal member cntributins 7 t 7.9 years f service = 55% f additinal member cntributins 8 t 8.9 years f service = 70% f additinal member cntributins 9 t 9.9 years f service = 85% f additinal member cntributins 10 r mre years f service = 100% f member cntributins plus 3% interest if left n depsit after 30 days Emplyees wh became a member n r after January 1, 2012, pursuant t A.R.S. 38-846.02 (C), upn terminatin f emplyment (fr any reasn ther than death r retirement) within twenty (20) days after filing an applicatin with PSPRS, shall receive a lump-sum payment, plus interest at a rate determined by the bard (currently 3%) as f the date f terminatin, f ONLY their accumulated cntributins (less any benefits paid r any amunts wed t the System) - thus, frfeiting all membership rights and credited service in the System upn receipt f refund f cntributins. The member will NOT receive the additinal percentage f cntributins as stated abve. A member may nt, under any circumstance, brrw frm, take a lan against r remve cntributins frm the member s accunt befre the terminatin f membership in the plan r the receipt f a pensin. A.R.S. 38-843(C). Retirement and Deferred Annuity EMPLOYEES WHO BECAME A MEMBER ON BEFE DECEMBER 31, 2011 Retirement Pursuant t A.R.S. 38-842(7, 12, 13, 32 and 44) and 38-844 and 38-845, retirement benefits will cmmence the first day f mnth fllwing terminatin f emplyment and based upn the fllwing: Age 62 with 15 years f service: 50% f the average mnthly benefit cmpensatin fr the first 20 years f credited service. The pensin is reduced by 4% per year fr each year f credited service under 20 years. A.R.S. 38-842(7 and 32) and 38-845(A)(1). 20 years f credited service: 50% f the average mnthly benefit cmpensatin fr the first 20 years f credited service. A.R.S. 38-842(7) and 38-845(A). 20 years f service with less than 20 years f credited service: 50% f the average mnthly benefit cmpensatin fr the first 20 years f credited service. The pensin is reduced by 4% per year fr each year f credited service under 20 years. A.R.S. 38-842(7 and 32) and 38-845(A)(1). 20 t 24.99 years f credited service: 50% f the average mnthly benefit cmpensatin fr the first 20 years f credited service plus 2% f the average mnthly benefit cmpensatin fr each year f credited service between 20 and 24.99. A.R.S. 38-842(7) and 38-845(A)(2). 25 r mre years f credited service: 50% f the average mnthly benefit cmpensatin fr the first 20 years f credited service plus 2.5% f the average mnthly benefit cmpensatin fr each year f credited service abve 20 years - up t a maximum f 80% f the average mnthly benefit cmpensatin. A.R.S. 38-842(7) and 38-845(A)(2). Deferred Annuity Inactive members (nt making cntributins t the System) that have at least (ten) 10 years f credited service may elect t receive a Deferred Annuity at the age f sixty-tw (62). This annuity is a lifetime mnthly payment that is actuarially equivalent t the member s accumulated cntributins in the System plus an equal amunt paid by the emplyer. This 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 8 f 11
annuity is nt a retirement benefit and annuitants are nt entitled t survivr benefits, benefit increases, r the grup health insurance subsidy. A.R.S. 38-846.01(A). Nte fr inactive members: Fr imprtant death-benefit infrmatin, please refer t the Death Benefit sectin under Inactive Member. EMPLOYEES WHO BECAME A MEMBER ON AFTER JANUARY 1, 2012 Retirement Pursuant t A.R.S. 38-842(7, 12, 32 and 44) and 38-844 and 38-845, retirement benefits will cmmence the first day f mnth fllwing terminatin f emplyment and based upn the fllwing: Age 52.5 with 25 years f service: 62.5% f the average mnthly benefit cmpensatin. Benefits will be reduced by 4% fr each year f credited service under 25 years. A.R.S. 38-842(7 and 32) and 38-845(G). 25 r mre years f service: 62.5% f the average mnthly benefit cmpensatin fr the first 25 years f credited service plus 2.5% f the average mnthly benefit cmpensatin fr each year ver 25 years f credited service - up t a maximum f 80% f the average mnthly benefit cmpensatin. The pensin is reduced by 4% per year fr each year f credited service under 25 years with a pr-rata reductin fr any fractinal years. A.R.S. 38-842(7) and 38-845(G). A member wh attains the service requirement fr a nrmal retirement, but des nt meet the age requirement, may elect t leave cntributins n accunt until reaching the age requirement and then elect t receive a retirement benefit (survivr benefits, benefit increases, r the grup health insurance subsidy). A.R.S. 38-846.01(B). Deferred Annuity Emplyees wh became a member n r after January 1, 2012 are nt eligible fr a Deferred Annuity. Hwever, a member wh attains the service requirement fr a nrmal retirement, but des nt meet the age requirement, may elect t leave cntributins n accunt until reaching the age requirement and then elect t receive a retirement benefit (survivr benefits, benefit increases, r the grup health insurance subsidy). A.R.S. 38-846.01(B). Return t Wrk after Retirement A.R.S. 38-849(E) Yu may return t wrk with the emplyer frm which yu retired and cntinue t receive yur retirement benefits as lng as yu are retired fr ne (1) year frm the effective date f yur retirement. Hwever, at ANY time fllwing retirement, if yu are re-emplyed in the same, r substancially similar psitin by the emplyer frm which yu retired, yur retirement benefits will be suspended. If yu are hired in any capacity by the emplyer frm which yu retired befre the year break, yur retirement benefits will be suspended. Yu can return t wrk with the emplyer frm which yu retired and cntinue t receive yur retirement benefits as lng as yu are retired fr a minium f sixty (60) cnsecutive days frm the effective date f yur retirement and yu were hired as a result f participating in an pen, cmpetitive, new-hire prcess fr an entry-level, nnsupervisry psitin, r hired as a fire inspectr, r arsn investigatr. Yu may cntinue t receive yur retirement benefits if yu are assigned t vluntary duties (i.e., acting as a limited authrity peace fficer fr an emplyer pursuant t the Arizna peace fficer standards and training bard rules). If yu are receiving an accidental r rdinary disability retirement (and have nt reached nrmal retirement) and have becme emplyed by any emplyer in a PSPRS cvered psitin, yur lcal bard shall determine if yu will cntinue t receive yur retirement benefits. Upn eligibility fr (re)retirement, the service frm the disabilty retirement will be cnsidered service and nt credited service and yur average mnthly cmpensatin will be based n the cmpensatin frm the new emplyment. 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 9 f 11
Yu cannt have an implicit r explicit pre-existing agreement with the emplyer frm which yu retired, whether written r verbal, t return t wrk, in any capacity. If a retired member returns t wrk in any capacity in a psitin rdinarily filled by an emplyee, the emplyer is required t pay an alternate cntributin rate t the PSPRS. Frm July 1, 2014 thrugh June 30, 2015, the alternate cntributin rate is 19.65%. Effective August 2, 2012, this sectin des nt apply if the retired member is required t participate in anther state retirement system and the retired member returned t wrk befre July 20, 2011. A.R.S. 38-843.05. Effective July 20, 2011, the premium benefit (subsidy) will nt apply if the retired member r survivr is reemplyed and participates in health care cverage prvided by the member's r survivr s new emplyer. A.R.S. 38-857(E). Service Purchase (als see the Transfers Sectin) Purchase f Prir Active Military Service (Frm 18) Members wh have at least ten (10) years f service with the System may purchase up t sixty (60) mnths f credited service fr perids f active military service perfrmed befre emplyment with their current emplyer. A.R.S. 38-858(A). Active members may als receive credited service limited t sixty (60) mnths if rdered/vlunteered t active military service while wrking fr the current emplyer if the criteria is met pursuant t A.R.S. 38-858. The member shall pay the members cntributins, upn which the emplyer shall make emplyer cntributins. If member perfrms military service due t presidential call-up, the emplyer shall make the emplyer and emplyee cntributins nt t exceed frty-eight (48) mnths pursuant t A.R.S. 38-858 (G). Fr mre infrmatin, cntact yur emplyer. Purchase f Prir Service frm an Out-f-State Agency (Frm POSS) Active members wh have at least five (5) years f service with the System that have previus service with an agency f the U.S. Gvernment, a state f the U.S., r a plitical subdivisin f a state f the U.S. as a full-time paid fire fighter, full-time paid certified peace fficer r full-time paid crrectins fficer engaged in law enfrcement duties may elect t redeem up t sixty (60) mnths f any part f the prir service if the prir service is nt n accunt with any ther retirement system. A.R.S. 38-853.01. Purchase f Prir Frfeited Service within the SAME Retirement Plan If a frmer member wh becmes RE-EMPLOYED with the SAME EMPLOYER within tw years after the frmer member's terminatin date, and applies with the System within ninety days f reemplyment, may elect t purchase all f the previusly frfeited credited service. The amunt required t reinstate the credited service is the amunt previusly withdrawn plus interest at the rate f 9% cmpunded annually frm the date f withdrawal t the date f repayment and the reimbursement is required t be paid within ne (1) year frm the date f re-emplyment. A.R.S. 38-849(C). (Frm P1B) If the statutry requirements abve are nt met, the member may still purchase sme r all f the previusly frfeited credited service calculated based n an amunt cmputed by the System s actuary t equal the actuarial present value. A.R.S. 38-849(C)(D), as applicable. (Frm P2) Purchase f Service between the Arizna Retirement Plans/Systems (Frm U2) Members f any f the fur Arizna state retirement System/Plans that have credited service under anther Arizna state retirement System/Plan may redeem the credited service t their current Arizna state retirement System/Plan by paying the full actuarial present value f the credited service int the current Arizna retirement System/Plan with the apprval f the PSPRS r gverning bard. A.R.S. 38-922. Purchase f Service frm Rural Metr/Cntract Service (Frm P2A) Active members that have previus service with a crpratin that cntracted with an emplyer nw cvered by the System t prvide firefighting services n behalf f that emplyer as a full-time paid firefighter may purchase service subject t limitatins pursuant t federal laws. A.R.S. 38-842 and 38-853.01. 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 10 f 11
Purchase f Service with a PSPRS Emplyer Prir t Jinder Date (Frm PSR) Active members f the System that had previus service in this state as an emplyee with an emplyer nw cvered by the System as a full-time paid fire fighter r full-time paid certified peace fficer may elect t redeem any part f the prir service if the prir service is nt n accunt with any ther retirement system. A.R.S. 38-853.01. Taxatin f Retirement Benefits All PSPRS retirement benefits in excess f $2,500 annually will be subject t Arizna state tax. A.R.S. 38-852 and 43-1022. Transfers (als see the Service Purchase sectin) Transfer f Cntributins between PSPRS Emplyers (Frm P1A) A member wh terminates emplyment with an emplyer and accepts a psitin with the same r anther emplyer participating in the system, after cmpleting an applicatin that is acceptable t the bard shall have their credited service transferred t their recrd with the new emplyer if they leave their accumulated cntributins n depsit with the System. The perid nt emplyed shall nt be cnsidered as service. A.R.S. 38-853. Transfer f Service between the Arizna Retirement Plans/Systems (Frm U2) Members f any f the fur Arizna state retirement System/Plans that have credited service under anther Arizna state retirement System/Plan may transfer the credited service t their current Arizna state retirement System/Plan by transferring the full actuarial present value f the credited service int the current Arizna retirement System/Plan with the apprval f the PSPRS r gverning bard. A reduced credited service amunt may be transferred based n the transfer f the actuarial present value f the credited service under the prir Arizna state System/Plan. A.R.S. 38-921 and 38-922. Transfer f Service between Municipal Retirement Systems and Special Retirement Plans (Frm U2A) An active r inactive member f a retirement System r Plan f a municipality f this state (i.e., City f Phenix and City f Tucsn) r f the PSPRS may transfer the service t their current retirement System r Plan based n the member s accumulated cntributins plus interest, r the member may elect a reduced service amunt t be transferred based n the actuarial present value. A.R.S. 38-923 and 38-924. This is nt an fficial versin f the Arizna Revised Statutes. If there are any differences r discrepancies, the fficial versin will prevail. 11/2014 Public Safety Persnnel Retirement System - Summary f Benefits Page 11 f 11