§ 24-10-405 — Employer accumulation account - Contributions

Arkansas § 24-10-405

• Jurisdiction: Arkansas
• Title: 24

Text

(a) The employer accumulation account as created by this section shall be the account into which contributions made by employers for annuities shall be accumulated and from which transfers shall be made as provided in this chapter. (b) Employer contributions paid to the Arkansas Local Police and Fire Retirement System provided for in this section shall be credited to the employer accumulation fund account of the employer making the contributions. (c) When an annuity becomes due and payable to or on behalf of a member, there shall be transferred to the retirement reserve account from his or her employer's account in the employer accumulation account the difference between the reserve for the annuity and the accumulated contributions standing to his or her credit in the members' deposit account at the time the annuity first becomes due and payable. (d) An employer accumulation account shall be maintained to receive and hold employer contributions. (e) Paid service employer contributions to the system shall be the total of the contribution amounts provided for in subsections (f) and (g) of this section, and the contributions shall be subject to the provisions of subsection (h) of this section. (f) (1) For paid service employers, the actuary shall annually compute the rate of contributions, expressed as a percent of active member pays, which will cover the benefit costs of paid service employees participating in the system. (2) The Board of Trustees of the Arkansas Local Police and Fire Retirement System in consultation with the actuary shall establish, based upon their financial assumptions, the actuarial valuation determining the contribution rate. (3) The board shall certify annually to the governing body of each employer the contribution rate so determined, and each employer shall pay contributions based on that rate to the system during the employer's next fiscal year, which begins six (6) months or more after the date of the board certification. (4) The payments shall be made in such manner and form, and in such frequency, and shall be accompanied by such supporting data, as the board shall determine. (5) When received, the payments shall be credited to the employer accumulation account. (g) Each employer shall provide its share as determined by the board of the administrative expenses of the system and shall pay that amount to the system to be credited to the income-expense account. (h) (1) Except under subdivision (h)(2) of this section, the paid service employer's total contributions to the system, expressed as a percentage of active member pays, in any employer fiscal year beginning with the second fiscal year that the political subdivision is an employer shall not exceed its total contributions for the immediately preceding fiscal year, expressed as a percent of active member pays, by more than one percent (1%). (2) However, an increase in the paid service employer's contributions to the system may exceed the limit of one percent (1%) per year imposed under subdivision (h)(1) of this section if the board certifies to the governing body of each paid service employer that the increase in the paid service employer's contribution rate is the direct result of increased benefit costs mandated by changes in the law made by the General Assembly. (i) (1) For volunteer service employers, the actuary shall annually compute the rate of contributions that will cover the benefit costs of volunteer service employees participating in the system as determined by policy established by the board. (2) The actuarial valuation determination of the contribution rate shall be based upon financial assumptions established by the board following consultation with the actuary. (3) The board shall certify annually to the governing body of each employer the determined contribution rate, and each employer shall pay contributions based on the determined rate to the system during the employer's next fiscal year that begins six (6) months or more from the date of the board certification. (4) The board shall determine required supporting data and the manner, form, and frequency in which payments shall be made. (5) The board shall establish necessary additional policies regarding volunteer service employers that are required to meet the financial objective of the system under this subchapter. (j) Beginning in fiscal year 2012, for each paid service employer the actuary shall annually compute the rate of contributions that will cover the benefit costs of its employees participating in the system as determined by policy established by the board. (k) (1) Beginning January 1, 2022, the board may add an additional amount to a paid service employer contribution to account for the cost of providing a disability benefit for each employee of the employer as provided under § 24-10-607 . (2) In a time and manner prescribed by the system, an employer shall remit to the system the employer contribution charged to the employer. (3) The employer contribution and any applicable penalty under this subsection shall not be subject to a limitation imposed by subsections (f) and (h) of this section. (4) The employer contribution and any applicable penalty charged or assessed under this subsection does not qualify for inclusion in funding with or the receipt of premium tax revenues provided under § 24-11-214 . (5) The board may establish rules necessary to implement this subsection.

Legislative History

Amended by Act 2021, No. 72,§ 1, eff. 4/1/2021. Amended by Act 2013, No. 40,§ 3, eff. 2/6/2013. Acts 1981, No. 364, § 6; A.S.A. 1947, § 12-3806; Acts 2003, No. 1368, § 1; 2007, No. 610, § 1; 2011, No. 979, § 1.