This bill proposes updates to the Arizona Revised Statutes, specifically section 38-749, regarding the Arizona State Retirement System (ASRS) and the definition of "unfunded liability" in relation to termination incentive programs. The current law defines a "termination incentive program" but will be amended to clarify that it includes both a significant increase in compensation prior to termination and any additional benefits provided to a member conditioned on their termination, with specific exclusions for customary payments.

Additionally, the bill introduces a new definition for "unfunded liability," which will encompass two scenarios: one related to the increase in accrued liability due to compensation exceeding a 30 percent threshold, and the other concerning the difference in accrued liability based on ASRS valuation assumptions for members retiring under a termination incentive program versus those remaining active. These changes aim to provide clearer guidelines for assessing costs associated with unfunded liabilities resulting from such programs.

Statutes affected:
Introduced Version: 38-749
House Engrossed Version: 38-749