Bill Text: AZ SB1171 | 2013 | Fifty-first Legislature 1st Regular | Engrossed
Bill Title: ASRS; spousal consent
Spectrum: Partisan Bill (Republican 2-0)
Status: (Engrossed - Dead) 2013-03-18 - Referred to House RULES Committee [SB1171 Detail]
Download: Arizona-2013-SB1171-Engrossed.html
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Senate Engrossed |
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State of Arizona Senate Fifty-first Legislature First Regular Session 2013
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SENATE BILL 1171 |
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AN ACT
Amending Section 38‑755, Arizona Revised Statutes, as amended by Laws 2012, chapter 87, section 4 and chapter 88, section 1; Amending section 38‑760, Arizona Revised Statutes, as amended by Laws 2012, chapter 88, section 2 and chapter 362, section 11; Amending section 38‑776, Arizona Revised Statutes; relating to the Arizona state retirement system.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 38-755, Arizona Revised Statutes, as amended by Laws 2012, chapter 87, section 4 and chapter 88, section 1, is amended to read:
38-755. Information as to member's status; beneficiary designation; spousal consent; confidentiality
A. Subject to rules prescribed by the board, on application of a member, the board shall furnish information concerning the member's status. In addition, the board shall furnish to each member an account, that may be electronic or online, showing the status of the member's account, including the name of the member's beneficiary as last listed with the board.
B. The member may change the member's beneficiary at any time in a manner established by ASRS.
C. A member who is married shall name and maintain the member's current spouse as a beneficiary to receive at least fifty per cent of the member's account, unless naming or maintaining the current spouse as a beneficiary violates another law, an existing contract or a court order. The member's current spouse may consent to a waiver of this requirement pursuant to section 38‑776.
Sec. 2. Section 38-760, Arizona Revised Statutes, as amended by Laws 2012, chapter 88, section 2 and chapter 362, section 11, is amended to read:
38-760. Optional forms of retirement benefits
A. On retirement, members may elect an optional form of retirement benefit as provided in this section.
B. The optional retirement benefits available under this section include the following:
1. Joint and survivor annuity in a reduced amount payable to the retiring member during life, with the provisions that after the member's death all, two‑thirds or one‑half of the retirement income, as the member elects, shall be continued during the lifetime of the contingent annuitant designated by the retiring member subject to the restrictions prescribed in section 38‑764. The amount of retirement income shall be the actuarial equivalent of the retirement income to which the member would be entitled under normal or early retirement. The election in a manner prescribed by the board shall name the contingent annuitant. The election may be revoked at any time before the member's effective date of retirement. At any time after benefits have commenced, the member may name a different contingent annuitant or rescind the election by written notice to the board as follows:
(a) If a different contingent annuitant is named, the annuity of the member under the same joint and survivor annuity option previously elected shall be adjusted to the actuarial equivalent of the original annuity, based on the age of the new contingent annuitant. The adjustment shall include all postretirement increases in retirement income that are authorized by law after the member's date of retirement. Payment of this adjusted annuity shall continue under the provisions of the option previously elected by the member.
(b) If the member rescinds the election, the member shall thereafter receive a straight life annuity equal to what the member would otherwise be entitled to receive if the member had not elected the joint and survivor annuity option, including all postretirement increases in retirement income that are authorized by law after the date of retirement. The increased payment shall continue during the remainder of the member's lifetime.
(c) If a member whose original date of retirement is before July 1, 2008 rescinds the joint and survivor annuity option previously elected and receives the straight life annuity pursuant to subdivision (b) of this paragraph, the member may again elect the same joint and survivor annuity option previously elected subject to the same restrictions prescribed in subdivision (a) of this paragraph.
(d) A member whose original date of retirement is on or after July 1, 2008 may exercise a one-time election to rescind the joint and survivor annuity option elected by the member if the contingent annuitant dies or ceases to be a contingent annuitant pursuant to the terms of a qualified domestic relations order.
(e) If the member's contingent annuitant is the member's current spouse, the member shall obtain the consent of the contingent annuitant pursuant to section 38‑776 before the member names a new contingent annuitant or before the member rescinds the election, except that consent is not required if the rescission is pursuant to subdivision (d) of this paragraph.
2. A period certain and life annuity actuarially reduced with payments for five, ten or fifteen years that are not dependent on the continued lifetime of the member but whose payments continue for the member's lifetime beyond the five, ten or fifteen year period. At the time of electing this option the member shall name a period certain beneficiary or beneficiaries who are entitled to receive the payments for any portion of the period certain beyond the lifetime of the member. The member may name a different beneficiary at any time. If no beneficiary survives the member, any remaining payments are the property of the member's estate. A member who retires after August 9, 2001 and before July 1, 2008 may rescind the election of a period certain and life annuity. If the member rescinds the election of a period certain and life annuity, the member shall thereafter receive a straight life annuity equal to what the member would otherwise be entitled to receive if the member had not elected the period certain and life annuity option, including all postretirement increases in retirement income that are authorized by law after the date of retirement. The increased payment shall continue during the remainder of the member's lifetime. If the member reverts to a straight life annuity pursuant to this paragraph, the member may again elect a period certain and life annuity subject to the same provisions of the period certain and life annuity previously elected by the member. If the member's contingent annuitant is the member's current spouse, the member shall obtain the consent of the contingent annuitant pursuant to section 38‑776 before the member rescinds the election of a period certain and life annuity or again elects a period certain and life annuity. A member whose original date of retirement is on or after July 1, 2008 may exercise a one‑time election to rescind the period certain and life annuity option elected by the member if the beneficiary dies or ceases to be a beneficiary pursuant to the terms of a qualified domestic relations order or at the expiration of the member's period certain term.
3. Beginning on July 1, 2002, a lump sum payment equal to not more than thirty‑six months of the member's retirement benefits based on the actuarial equivalent of the retirement income to which the member would be entitled under normal or early retirement. The member's benefit shall be actuarially reduced to provide for the lump sum payment. The lump sum payment shall be made at the time of retirement. Any benefit increase granted to a member who elects a lump sum payment pursuant to this paragraph is subject to the following conditions:
(a) If the benefit increase is a percentage increase of the member's retirement benefit, the increase shall be based on the actuarially reduced retirement benefit of the member.
(b) If the benefit increase is pursuant to section 38‑767, the amount of the member's benefit increase shall be calculated without regard to the lump sum payment pursuant to this paragraph.
4. Other forms of actuarially reduced optional benefits prescribed by the board.
C. A member who is married at the time of retirement shall elect a monthly benefit in the form of a joint and survivor annuity pursuant to subsection B, paragraph 1 of this section, and the member's current spouse shall be the contingent annuitant unless the member's current spouse consents to a waiver of this requirement pursuant to section 38‑776 or the election would violate another law, an existing contract or a court order. If the married member does not elect a type of joint and survivor annuity for the member's current spouse and the member's current spouse has not waived the requirements of this subsection, ASRS shall cancel the member's retirement. The member may reapply for retirement at any time in a manner established by ASRS.
Sec. 3. Section 38-776, Arizona Revised Statutes, is amended to read:
38-776. Spousal waiver and consent
A. A member's current spouse may consent to one of the following requirements established in section 38‑755 or 38‑760 by signing and submitting an acknowledgement in a manner established by ASRS:
1. A change of beneficiary that provides the member's current spouse with less than fifty per cent of the member's account balance.
2. The member's retirement application that does not name the member's current spouse as a contingent annuitant of a joint and survivor annuity.
3. A change or rescission of the member's current spouse's contingent annuitant status.
B. If the member's current spouse is not capable of executing the acknowledgement because of an incapacitating mental or physical condition, a power of attorney or guardian may execute the acknowledgment on the current spouse's behalf.
C. The member may affirm in writing under penalty of perjury in a manner determined by ASRS that spousal consent is not required because of one of the following reasons:
1. The member is not married.
2. The member's current spouse has no identifiable community property interest in the member's benefits.
3. The member does not know, and has taken all reasonable steps to determine, the location of the member's current spouse.
4. The member has received notification from the board that a domestic relations order is acceptable pursuant to section 38‑773 and that domestic relations order requires ASRS to pay benefits to an alternate payee that is contrary to the requirements of section 38‑760.
5. Obtaining consent violates another law, or an existing contract or a court order.
D. This section does not abrogate any community property laws of this state.
E. Payments or distributions made by ASRS in good faith reliance on the consent or waiver of a member's current spouse, the affirmations of a member contained in documents submitted to ASRS pursuant to this section or the member's indication to ASRS that the member is not married constitute a full and complete discharge and release of all liability of the board or ASRS, or both, respecting these payments or distributions.
F. If questions arise as to the distribution of a particular member's account, ASRS shall use reasonable judgment to distribute the account in a manner that is consistent with Arizona community property laws and interpretations of those laws.
Sec. 4. Retroactivity
The amendments to the following sections apply retroactively to from and after June 30, 2013:
1. Section 38‑755, Arizona Revised Statutes, as amended by Laws 2012, chapter 87, section 4 and chapter 88, section 1, and this act.
2. Section 38‑760, Arizona Revised Statutes, as amended by Laws 2012, chapter 88, section 2 and chapter 362, section 11, and this act.
3. Section 38‑776, Arizona Revised Statutes, as amended by this act.
