TYPES OF RETIREMENT AND BENEFITS

Tucson Code ch. 22, art. III, div. 1

in effect

Tucson Code § 22-30 Definitions.

Sec. 22-30. Definitions. Sec. 22-30(a). "Accrued benefit" means the amount of the retirement benefit that the member has earned as of any particular date, based on the member's average final monthly compensation and credited service as of the date of the calculation. Sec. 22-30(b). "Accrued service" means a member's service credit under the system for vesting and benefit accrual purposes which is earned (1) for personal service rendered to the city in exchange for compensation (including certain approved leaves of absence), (2) for accrued and unused leave earned during employment with the city prior to entering the end of service program (subject to the restrictions set forth in section 22-36(b)(2)), or (3) in connection with a direct trustee-to-trustee transfer from the Arizona State Retirement System pursuant to section 22-36(c)(1). With regard to the accrued service earned pursuant to (1) or (2) above, a member shall earn 1/2080 of a year of service credit for each hour of compensation. A member who is compensated on less than a full-time basis shall receive credit for a proportionate part of a full year of accrued service. Accrued service shall be expressed as whole and fractional years. Sec. 22-30(c). "Accumulated contributions account" means the sum of all member contributions made by the employee, not to include employer contributions, and the interest credited to the member contributions during the period the member contributions are on deposit with the Tucson Supplemental Retirement System. Sec. 22-30(d). "Actuarial Equivalent" means a Retirement Benefit payment option of equal value to another Retirement Benefit payment option, computed on the basis of appropriate actuarial assumptions. The Board shall determine, in accordance with Section 22-44(h), the applicable mortality table and interest rates, which shall be used in making Actuarial Equivalent determinations under the System, upon receipt of advice and experience analysis from the System actuary. The actuarial assumptions approved by the Board shall be set forth in an "Addendum to TSRS Code Sec. 22-30(d) – TSRS Actuarial Assumptions" (the "Addendum") which shall be updated by the Board from time to time as necessary. The Addendum shall be maintained in the offices of the System Administrator. Sec. 22-30(e). "Additional service" means whole and fractional years of additional service credit which is purchased by the member in accordance with section 22-36(c)(2) through section 22-36(g). Additional service is recognized for benefit accrual and benefit eligibility purposes hereunder, but is not recognized for vesting purposes. Sec. 22-30(f). "Adjusted income base" means, for the purposes of section 22-39(f), the member's compensation as of the member's termination date, adjusted thereafter for each fiscal year of disability retirement to approximate the average compensation increase for active employees of the city. The member's termination date compensation shall be adjusted annually by the sum of (1) the actual city wide cost of living percentage increase for active employees funded by the city in the applicable fiscal year, plus (2) a three and eight-tenths percent (3.8%) average merit increase for any fiscal year during which merit increases for active employees are funded by the city. The adjusted income base shall be determined by the board, in its discretion and on a uniform and non-discriminatory basis, for any disabled member. Sec. 22-30(g). "Alternate payee" means member's spouse, former spouse or dependent children/step-children or person identified as an alternate payee in a plan approved domestic relations or child support order. Sec. 22-30(h). "Annual required contribution" or "ARC" means the annual amount necessary to fund all employee segment normal cost amounts plus that amount necessary to satisfy the annual amortization requirements for the system's unfunded accrued liability, as determined by the system's actuary in accordance with sound actuarial principles, and as set by the board on a fiscal year basis. The annual required contribution is expressed as a percentage of the city's active member payroll costs for a fiscal year. Changes in accrued liabilities and actuarial experience may increase or decrease the annual required contribution. Sec. 22-30(i). "Average final monthly compensation" or "AFMC" means the member's average compensation for the applicable employment period, as defined below, within the one hundred twenty (120) months immediately preceding the member's termination date, during which the member's compensation was the highest. The "applicable employment period" for a tier I member shall be a period of thirty-six (36) consecutive calendar months of employment with the city and the "applicable employment period" for a tier II member shall be a period of sixty (60) consecutive calendar months of employment with the city. If the member has less than the number of consecutive calendar months of employment required for the applicable employment period calculation (thirty-six (36) months or sixty (60) months), the AFMC shall be the average of the compensation earned by the member during the period of employment with the city. For tier I members, accumulated unused vacation and sick leave hours shall be included in the thirty-six (36) month period at the member's final pay rate, with an equal number of hours subtracted from the beginning of the thirty-six (36) month period, provided that the member contribution requirements of section 22-34(f) are satisfied and that the inclusion of the accumulated unused vacation and sick leave hours does not result in a decrease in the AFMC. Accumulated unused vacation and sick leave hours shall not be included in the calculation of average final monthly compensation for tier II members. The calculation of average final monthly compensation is subject to the special adjustment rules set forth in section 22-43(b) (part-time employment) and section 22-43(c) (unpaid authorized leave). For the period beginning on July 1, 2009, and ending on June 30, 2010, any active member who is subject to a reduction in pay in lieu of furlough shall continue to receive compensation credit for purposes of AFMC calculation during the reduction period at the rate of pay in effect for the member immediately preceding the pay reductions in lieu of furlough. Sec. 22-30(j). "Beneficiary" means any person(s), trust or estate entitled to receive benefits under this article as designated by a member of the system in accordance with section 22-33(f). Sec. 22-30(k). "Board" means the Tucson Supplemental Retirement System Board of Trustees. Sec. 22-30(l). "Code" means the Internal Revenue Code of 1986, as amended. Sec. 22-30(m). "Compensation" means base salary, vacation and sick leave pay and worker's compensation pay equal to base salary for which an employee in a covered position receives credited service. In certain cases and pursuant to the provisions of this article, compensation may be imputed to hours included in credited service for which no services are performed. Compensation cannot be earned after retirement. Sec. 22-30(n). "Credited service" means the accrued service and additional service to which the member or the member's beneficiary shall be entitled. Sec. 22-30(o). "Death benefit" means the cash lump sum payable upon the death of a vested member and equal to two (2) times the value of the deceased member's accumulated contributions account. Sec. 22-30(p). "Disability retirement benefit" means the retirement benefit payable to a member who is qualified for disability retirement as set forth in section 22-39(a) and which is calculated in accordance with section 22-39(c). Sec. 22-30(q). "Domestic relations order" means any judgment, decree, order or approval of a property settlement agreement entered in a court of competent jurisdiction and issued pursuant to a state domestic relations law that relates to the provision of child support, alimony payments, or marital property rights to a spouse, former spouse, child or other dependent of a member. Sec. 22-30(r). "Early retirement benefit" means the retirement benefit payable to a member who is eligible for early retirement as set forth in section 22-37(a)(1)(B) and which is calculated in accordance with section 22-37(b). Sec. 22-30(s). "Employee segment normal cost" means the annual amount necessary to fund the benefits accrued under the system in a particular year based on member service and compensation, by each employee segments eligible for membership in the system for which the system actuary shall perform employee segment normal cost calculations: (i) members hired by the city prior to July 1, 2006, (ii) tier I members hired by the city on or after July 1, 2006, and (iii) tier II members. Sec. 22-30(t). "Employer contribution" means the difference between the annual required contribution and the member contribution rate, determined on a fiscal year basis. Sec. 22-30(u). "Interest" means the annual rate or rates of interest declared by the board from time to time in accordance with the provisions of section 22-44(h) and credited to the members' accumulated contributions accounts in accordance with the board's declaration. Interest is credited as simple interest with no compounding and is deposited two (2) times per year, subject to the authority of the board to modify the Interest crediting method from time to time. Sec. 22-30(v). "Legal or personal representative" means the court appointed or duly authorized legal representative of an employee, a member, an estate or a minor child. Sec. 22-30(w). "Member" means an employee who is eligible to accrue retirement benefits under the system or, as the context may indicate, a former employee who has accrued refund rights or retirement benefits under the system. Sec. 22-30(x). "Member contribution rate" means the portion of the annual required contribution to be paid by the members in any particular fiscal year, determined in accordance with section 22-34(a) or section 22-34(b), as applicable. Sec. 22-30(y). "Normal retirement age" means the age at which a member is eligible for a normal service retirement. For tier I members hired by the city prior to July 1, 2009, the normal retirement age is sixty-two (62). For tier I members hired by the city on or after July 1, 2009, and prior to July 1, 2011, the normal retirement age is the later of the member's sixty-second (62nd) birthday or the date on which the member is credited with at least five (5) years of accrued service. For tier II members, the normal retirement age is the later of the member's sixty-fifth (65th) birthday or the date on which the member is credited with at least five (5) years of accrued service. Sec. 22-30(z). "Normal retirement benefit" means the retirement benefit payable to a member who is eligible for a normal service retirement as set forth in section 22-37(a)(1)(A). For tier I members, the normal retirement benefit shall equal two and twenty-five one hundredths (2.25) percent of the member's average final monthly compensation multiplied by the number of years of the member's total credited service. For tier II members, the normal retirement benefit shall equal two and no one hundredths (2.00) percent of the member's average final monthly compensation multiplied by the number of years of the member's total credited service. Sec. 22-30(aa) "Prior government or military service" means time as an employee of the United States government, a state of the United States, a political subdivision of a state, this political subdivision, a tribal government (with the exception of any services rendered to the tribal government after January 1, 2007, which were commercial in nature), the Armed Forces of the United States, a state's National Guard, the reserves of any military establishment of the United States or any state whether on active or reserve duty; and, such service is not treated as credited service with any other retirement system for which the member is entitled to receive a benefit. Sec. 22-30(bb). "Qualified military service" means service in the uniformed services of the United States, as defined in section 414(u)(5) of the Code. Sec. 22-30(cc). "Retirement benefit" means the monthly benefit payable to a member who satisfies the conditions for normal retirement, early retirement, deferred retirement or disability retirement. Sec. 22-30(dd). "Retirement points rule" means, for tier I members, the rule of eighty (80). The rule of eighty (80) is defined as the sum of the member's age and years of credited service equaling at least eighty (80). For tier II members, the "retirement points rule" means the rule of eighty-five (85). The rule of eighty-five (85) is defined as the sum of the member's age and years of crediting service equaling at least eighty-five (85); provided, however, that the member is at least sixty (60) years of age. Sec. 22-30(ee). "Spouse" means the lawfully recognized husband or wife of a member. The term "spouse" also includes the domestic partner of a member, provided that the member files a valid a domestic partnership registration statement with the city's finance department, in accordance with chapter 17, article IX of the Tucson Code, as amended. With regard to domestic partners, the system administrator may rely exclusively on the finance department's domestic partnership records. In its discretion, the system administrator may require any member or purported spouse to produce reasonable documentation of an individual's status as a spouse hereunder. Sec. 22-30(ff). "System" means the Tucson Supplemental Retirement System, as set forth in the chapter 22, article III of the Tucson City Code, as amended. Sec. 22-30(gg). "Termination date" means the member's last day of active employment with the city as the result of resignation, discharge, layoff, retirement, death or total and permanent disability. Sec. 22-30(hh). "Tier I member" means a member who was hired by the city prior to July 1, 2011. A rehired member shall reenter the system as a tier I member only if all of the following conditions are satisfied as of the date of rehire: (1) The rehired employee was a tier I member of the system during the employee's previous employment with the city, (2) the rehired employee was a vested member as of the most recent termination date, and (3) the rehired employee has not requested a refund of the member's accumulated contributions account or a transfer of his accrued benefit in accordance with section 22-41. All other rehired members shall reenter the system as tier II members. Sec. 22-30(ii). "Tier II member" means a member who was hired by the city on or after july 1, 2011, or a rehired member who is not entitled to be a tier I member as set forth in section 22-30(gg). Sec. 22.30(jj). "Total and permanent disability" means the inability to engage in any substantial gainful activity with the city by reason of any medically determinable physical or mental impairment that can be expected to result in death or continue for a long and indefinite duration. If the Social Security Administration determines that a member is totally and permanently disabled for purposes of Social Security Disability Insurance, the Social Security Administration's determination shall be treated as strong evidence of total and permanent disability; provided, however, that the Board shall make an independent determination of the date on which any disability retirement benefit shall commence in accordance with section 22-39(b). Sec. 22.30(kk). "Trust fund" means the custodial or trust account(s) maintained under the system as set forth in section 22-31. Sec. 22-30(ll). "Vested" means a member who has accumulated a minimum of five (5) years of accrued service. A vested member is entitled to receive a retirement benefit under the system. (Ord. No. 10657, § 1, 4-28-09, eff. 7-1-09; Ord. No. 10696, § 1, 8-5-09, eff. 7-1-09; Ord. No. 10711, § 1, 9-9-09, eff. 7-1-09; Ord. No. 10712, § 1, 9-9-09, eff. 7-1-09; Ord. No. 10915, § 1, 6-21-11, eff. 7-1-11; Ord. No. 11020, § 1, 9-11-12, eff. 7-1-09; Ord. No. 11062, §§ 1, 2, 3-27-13, eff. 7-1-13; Ord. No. 11327, § 1, 12-8-15, eff. 1-1-16; Ord. No. 11595, § 1, 10-23-18)

Tucson Code § 22-31 Trust fund.

Sec. 22-31. Trust fund. The trust fund maintained in connection with the system which is intended to constitute a tax-qualified retirement plan trust fund as described in Section 401(a) and 501(a) of the Code and shall consist of all the assets of the system to be held in trust for the benefit of its members and their beneficiaries. The board shall select an appropriate custodial financial institution for deposit of the system's trust fund. (Ord. No. 10657, § 1, 4-28-09, eff. 7-1-09)

Tucson Code § 22-32 Exclusive benefit.

Sec. 22-32. Exclusive benefit. The Tucson Supplemental Retirement system shall operate for the exclusive purpose of providing benefits to the members and their beneficiaries. It is prohibited for any part of the corpus or income of the trust fund to be used for, or diverted to, purposes other than for the exclusive benefit of the members or their beneficiaries. (Ord. No. 10657, § 1, 4-28-09, eff. 7-1-09)

Tucson Code § 22-33 Membership.

Sec. 22-33. Membership. Sec. 22-33(a). Mandatory membership. All permanent employees in the classified service who are employed by the city on a full time basis shall be contributing members of the system upon their date of hire by the city as a condition of their employment. For purposes of this chapter, full time basis is defined by the Tucson City Code Civil Service Rules and Regulations. Additionally, certain permanent part-time employees hired by the city before October 4, 2004, entered the system as contributing members and shall remain grandfathered members pursuant to city Ordinance 10047. Permanent full time employees who, without a break in service, elect to work less than full time shall remain contributing members of the system. Sec. 22-33(b). Optional Membership. Full-time appointed officers, full-time employees in the offices of the Mayor and City Council and full-time unclassified employees in the City Manager's office (collectively, "appointed positions") may elect membership in the system within ninety (90) days of their formal appointment to an appointed position. Accrued service accrues from the beginning of the first payroll period commencing after an application for participation in the system has been accepted by the system administrator. An individual who is appointed to a second or successive appointed position shall be afforded an additional opportunity to apply for participation in the system as a result of the second or successive appointment only if the individual commences the new appointed position at least thirty (30) days after his most recent termination date. Similarly, a member who transfers directly from a mandatory membership position defined in section 22-33(a) above to an appointed position without a termination date may elect to waive membership in the system within ninety (90) days of their formal appointment to the appointed position. In the case of an individual who waives membership while serving in an appointed position, accrued service and member contributions shall cease on the effective date of the membership waiver, as determined by the system administrator in a uniform and non-discriminatory manner. A waiver of membership pursuant to this section shall not constitute a termination of membership for purposes of determining a member's right to a refund of accumulated contributions or entitlement to retirement benefits. Sec. 22-33(c). Termination of membership. Should any member leave city employment with less than five (5) years of accrued service and for any reason other than death, the member shall cease to be a member of the system and will receive a refund of the member's accumulated contributions account in accordance with section 22-41(b). As set forth in section 22-41(e), the refund of the accumulated contributions account triggers an immediate forfeiture of credited service. Sec. 22-33(d). Exclusion from membership. The following individuals are excluded from membership: (1) nonpermanent city employees and permanent part-time city employees whose membership has not been grandfathered by the city in accordance with section 22-33(a); (2) employees occupying positions covered by the State of Arizona Public Safety Personnel Retirement System; (3) leased employees, as defined in Section 414(n) of the Code, and (4) independent contractors. Sec. 22-33(e). Reentry into membership. Any former member who is reemployed by the city in an eligible job classification shall become a member of the system. The member contributions required from a rehired member shall be determined in accordance with section 22-34(c) and credited service accrued by the rehired member shall be determined in accordance with section 22-36(h). The accrued benefit earned by a rehired member shall be determined based on the member's status as a tier I member or a tier II member, as those terms are defined in section 22-30(hh) and 22-30(ii), respectively. The rules set forth herein regarding rehired members shall apply to members who return to employment with the city following a layoff or any other event which constitutes a termination date under section 22-30(gg). Sec. 22-33(f). Designation of beneficiary(ies). Each employee, or designated legal representative, shall file a statement designating a beneficiary(ies) or contingent beneficiary(ies) within thirty (30) days after becoming a member of the system. Any member who is married and wishes to designate a non-spouse beneficiary must provide spousal consent to the beneficiary designation in accordance with paragraph (1) below. Until such statements are filed, any death benefit, survivor annuity or refund of member contributions payable upon the member's death shall be paid to the member's spouse, if the member was married at death, or to the member's estate, if the member is not married at death. (1) Spousal consent. Any member who is married and wishes to designate a non-spouse beneficiary must provide spousal consent to the beneficiary designation. The consent of a member's spouse to a beneficiary designation shall be in writing, acknowledge the effect of such an election and be witnessed by a notary public or a designated representative of the system administrator. No spousal consent will be required if the system administrator determines, in its sole discretion, that such consent cannot be obtained because the spouse cannot be located or other circumstances exist that preclude the member from obtaining such consent. (2) Changes in marital status. Except as set forth herein, a member who intends to change their beneficiary as a result of a change in marital status must update the beneficiary designation to reflect the member's wishes. A member's divorce generally does not impact the validity or enforceability of a beneficiary designation on file with the system administrator. Beneficiary designation provisions contained in a domestic relations order accepted by the system administrator in accordance with section 22-43.1 will be enforced, however, notwithstanding any beneficiary designation or provision of the system to the contrary. Effective with regard to deaths occurring after December 31, 2018, the member's spouse will become the member's default beneficiary even if the member enters into a marriage after having filed a beneficiary designation with the system administrator, unless and until the member files a new designation with the consent of the member's current spouse. (3) Designation of a trust as beneficiary. A trust may be designated as a beneficiary only if the trust is established by the member, the trust is or becomes irrevocable at the time of the member's death and both the member and the trustee of the member's trust provide all requested information regarding the trust to the system administrator. (4) Finality of Designations. A designation of a beneficiary(ies) shall become effective and shall remain effective upon receipt and acceptance of the designation by the system administrator and except as set forth in paragraph (1) above. If the system administrator does not receive sufficient information to implement a member's beneficiary designation, the system administrator may exercise its discretion to declare a designation invalid. Upon ratification by the board of a member's application for retirement benefits, the member's designation of a retirement benefit survivor shall become irrevocable with regard to any joint and survivor annuity elected in accordance with section 22-42(c) or section 22-42(d). All other beneficiary designations become irrevocable upon the member's death. There shall be no liability on the part of the city, the board or the system administrator with respect to any payment made in accordance with this section 22-33(f). (Ord. No. 10657, § 1, 4-28-09, eff. 7-1-09; Ord. No. 10711, § 2, 9-9-09, eff. 7-1-09; Ord. No. 10712, § 2, 9-9-09, eff. 7-1-09; Ord. No. 10915, § 2, 6-21-11, eff. 7-1-11; Ord. No. 11020, § 2, 9-11-12, eff. 7-1-09; Ord. No. 11327, §§ 2, 3, 12-8-15, eff. 1-1-16; Ord. No. 11595, § 2, 10-23-18)

Tucson Code § 22-34 Membership contributions.

Sec. 22-34. Membership contributions. Sec. 22-34(a). Fixed contribution rate. Each member hired prior to July 1, 2006, shall make mandatory member contributions to the system for every pay period during which the member receives compensation in an amount equal to five (5) percent of the member’s compensation. The finance director shall deduct this amount and credit it to the member’s accumulated contributions account. Sec. 22-34(b). Variable Contribution Rates. Each member hired on or after July 1, 2006 shall make mandatory member contributions to the system for every pay period during which the member receives compensation in an amount equal to the applicable percentage of the Employee Segment Normal Cost. For purposes of this Section 22-34(b), the applicable percentage shall equal the percentage determined by the City on an annual basis prior to the beginning of each fiscal year, and which shall equal no less than fifty (50) percent and no more than one hundred (100) percent; provided that the member's annual contribution rate (1) shall in no event be less than five (5) percent of compensation and (2) shall be subject to an annual fiscal year adjustment (increase or decrease) equal to no more than two and one-half (2 1/2) percent of member compensation. The finance director shall deduct the applicable member contributions from each member's compensation and credit it to the member's accumulated contributions account. Notwithstanding the foregoing, effective for the period beginning on July 1, 2020 and ending on June 30, 2023, the variable contribution rate calculation provisions of this Section 22-34(b) are suspended and the Member Contribution Rates approved by the City for Tier I Members and Tier II Members for the period beginning on July 1, 2019 and ending on June 30, 2020 shall continue through June 30, 2023. The variable contribution rate calculation provisions of this Section are suspended temporarily in light of the coronavirus pandemic and the continuing economic consequences of the pandemic. Sec. 22-34(c). Contribution rates for rehired members. If a member separates from employment with the city and is later re-hired, the rate of mandatory member contributions applicable to the rehired member shall be determined in accordance with this section. Any member who was originally hired by the city prior to July 1, 2006, who was a vested member at the time of separation from employment with the city and who does not request a refund of member contributions in accordance with section 22-41 prior to his date of reemployment with the city shall make mandatory member contributions to the system in accordance with section 22-34(a) above. All other rehired members shall make mandatory member contributions in accordance with section 22-34(b) above. Sec. 22-34(d). Employer pick-up/member contributions. All member contributions to the system are mandatory and are picked up by the city in accordance with Code Section 414(h). As a result of the city’s pick-up arrangement, the member contributions are contributed to the system on a pre-tax basis and shall not be included in the member’s gross income until the member requests a refund of contributions or receives retirement benefit payments. All member contributions are deposited into the individual accumulated contributions account maintained by the system administrator on behalf of each contributing member. Sec. 22-34(e). Qualified military service. A member who leaves employment for qualified military service and is timely reinstated by the city and meets all other applicable requirements for benefits following qualified military service including, without limitation, the requirements set forth in the city's Administrative Directive 2.01-7G regarding military leave, as amended, shall be permitted (but not required) to make up missed member contributions to the system. Any reinstated member who wishes to make up missed member contributions shall contribute all or a portion of the member contributions that would have been made by the member but for the qualified military service, calculated at the compensation rate in effect for the member immediately preceding the commencement of the qualified military service and the member contribution rate in effect during the qualified military service, and without interest or any other adjustment. The missed member contributions shall be contributed to the system during a period that begins on the date of reinstatement and ends on the earliest of (1) the date that is five (5) years from the date of reinstatement; (2) the date that marks the end of a period which is three (3) times the length of the member's most recent period of qualified military service; or (3) the member's termination date. Any and all member contributions made up pursuant to this section shall be treated as regular member contributions made in accordance with section 22-34(d). Following the contribution of missed member contributions to the system, the system administrator shall take all steps necessary to increase the member's accrued benefit to include the portion of the member's qualified military service covered by the missed member contributions. Notwithstanding the foregoing, to the extent the member is paid his full city salary during military leave in accordance with Section IV of the city's Administrative Directive 2.01-7G, as amended (Paid Military Leave Not to Exceed 30 Calendar Days in any Two (2) Consecutive Federal Fiscal Years), member contributions shall be deducted from the member's military leave pay on the same basis as member contributions would be made by the member under section 22-34 if the member was actively employed. Sec. 22-34(f). Accrued vacation cash out. Except as set forth below, all hours of accumulated vacation earned by a tier I member and cashed out by the city as of the member’s termination date shall be included in a member’s compensation for member contribution purposes, provided that member contributions are made in accordance with this section. The member contributions applicable to accumulated vacation shall be calculated using the tier I member’s compensation and member contribution rate as in effect immediately preceding the tier I member’s termination date. The calculation and collection of member contributions under this section shall trigger the city’s obligation to make corresponding employer contributions under section 22-35(a) for the accumulated vacation hours. Vacation leave earned by a tier I member pursuant to the city's vacation leave carryover program ("VLCP") is not subject to the compensation and member contribution rules set forth in the first sentence of this section. Vacation leave earned pursuant to the VLCP and cashed out by the city shall not be included in a member's compensation under any circumstances. Sec. 22-34(g). Non-forfeiture and refund of contributions. It is the right of each member to request a refund of the member’s accumulated contributions, plus interest, upon separation from city service and the right of each beneficiary to be paid the member’s accumulated contributions, plus interest, upon the member’s death before retirement or unused contributions, plus interest, upon the member’s death after retirement, whichever is applicable. All refunds, and the related forfeiture of credited service, shall be administered in accordance with section 22-41. Sec. 22-34(h). Employment status changes. Effective July 1, 2011 and notwithstanding any provision of the Code to the contrary, the mandatory member contribution rate for an employee who first becomes a member in the system after the employee's date of hire or rehire with the city will be determined pursuant to this section. If an employee is hired or rehired by the city in an employment position that does not qualify for membership in the system and later becomes a member, the applicable member contribution rate shall be determined as of the date on which the employee first satisfies the requirements for membership under section 22-33, as opposed to the employee's date of hire or rehire. The member contribution rate for a reemployed member shall be determined in accordance with section 22-34(c). (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 10915, § 3, 6-21-11, eff. 7-1-11; Ord. No. 11062, § 3, 3-27-13, eff. 7-1-13; Ord. No. 11243, § 1, 2-18-15, eff. 7-1-15; Ord. No. 11327, §§ 4, 5, 12-8-15, eff. 1-1-16; Ord. No. 11349, § 1, 4-5-16, eff. 7-1-16; Ord. No. 11430, § 1, 1-24-17, eff. 7-1-17; Ord. No. 11529, 2-21-18, eff. 7-1-18; Ord. No. 11752, § 1, 5-19-20, eff. 7-1-20; Ord. No. 11795, § 1, 10-20-20; Ord. No. 11837, § 1, 6-8-21, eff. 7-1-21; Ord. No. 11927, § 1, 5-3-22, eff. 7-1-22)

Tucson Code § 22-35 City contributions.

Sec. 22-35. City contributions. Sec. 22-35(a). Contribution by the city. At the end of each payroll period, the finance director shall cause the city to contribute to the trust fund an amount equal to the employer contribution for the particular payroll period, plus any and all member contributions picked up by the city in accordance with section 22-34(d) and section 22-36(g)(2). Sec. 22-35(b). Certification of rates and charges. The board shall certify to the city manager, on a fiscal year basis, the annual required contribution, the member contribution rate and the employer contribution for the system. Sec. 22-35(c). City's funding requirement for system. The city council shall appropriate no less than one hundred (100) percent of the employer contribution for a particular fiscal year. Sec. 22-35(d). Determination and deposit of employer contributions. The finance director at the end of each pay period shall apply the appropriate employer contribution and member contribution rates to the total compensation of members for such period and shall transfer this amount to the trust fund. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09)

Tucson Code § 22-36 Accumulation of credited service.

Sec. 22-36. Accumulation of credited service. Sec. 22-36(a). Credited service generally. A member will receive credited service for purposes of determining the benefits to which the member or the member's beneficiary(ies) will be entitled. Credited service is the total of the member's accrued service and additional service. Accrued service shall be used to determine whether a member is vested, as well as to determine the member's accrued benefit. Additional service shall be considered for benefit accrual purposes only. Sec. 22-36(b). Accrued service for city employment. (1) Employment periods. A member shall earn 1/2080 of one (1) year of accrued service credit for each hour of regular time compensation, including authorized periods of absence for which the member receives compensation. A member who is compensated for two thousand eighty (2,080) or more hours of regular time during twelve (12) consecutive calendar months shall receive one (1) year of accrued service. A member who is compensated on less than a full-time basis shall receive credit for a proportionate part of a full year of accrued service. (2) Periods of leave. With regard to tier I members, all periods of leave with pay, accrued and unused vacation and sick leave at the date of retirement, workers compensation and qualified military service shall be used in calculating a member's total accrued service. The accrued service of a tier I member also shall include accumulated vacation cashed out by the city; provided, however, that the member makes member contributions on the value of the vacation leave that is cashed out by the city as set forth in section 22-34(f). Notwithstanding the foregoing, vacation leave earned by a tier I member pursuant to the city's vacation leave carryover program and cashed out by the city shall not be included in the calculation of a member's accrued service under any circumstances. With regard to tier II members, all periods of leave with pay, workers compensation and qualified military service shall be used in calculating a member's total accrued service, but all accrued and unused vacation and sick leave at the date of retirement and all accumulated vacation that is cashed out by the city shall be excluded. Special rules regarding qualified military service are set forth in subparagraph three (3) below. (3) Military leave during active employment. An active city employee who leaves employment to complete qualified military service, makes a timely return to the city following an honorable discharge (as defined below), and who makes up missed member contributions in accordance with section 22-43(e) may receive accrued service for periods of qualified military service. Accrued service credited to a member who satisfies the conditions of this section and section 22-43(e) shall not exceed sixty (60) months of accrued service for qualified military service, plus accrued service for reasonable periods of absence from employment which are necessitated by the qualified military service, except as provided by applicable federal law. The member's return to city service shall be deemed to be timely if the member is reinstated or requests reinstatement in accordance with the following time frames: (A) The first full regularly scheduled work period on the first full calendar day following completion of the qualified military service for periods of qualified military service of less than thirty-one (31) days; (B) not later than fourteen (14) days after completing qualified military service for periods of qualified military service of at least thirty (30) days and not more than one hundred eighty (180) days; or (C) not later than ninety (90) days after completing qualified military service for periods of qualified military service of more than one hundred eighty (180) days. If the member is hospitalized for, or convalescing from, an illness or injury incurred in, or aggravated during, the performance of qualified military service, the member's return to city service shall be deemed to be timely if the member returns as of the earlier of the end of the period of recovery or the date which is two (2) years after the completion of qualified military service. Notwithstanding the foregoing, an active city employee who leaves employment for military leave in accordance with Section IV of the city's Administrative Directive 2.01-7G, as amended (Paid Military Leave Not to Exceed 30 Calendar Days in any Two (2) Consecutive Federal Fiscal Years) shall be credited with accrued service for the period of military leave during which member contributions are made, regardless of the employee's subsequent return or failure to return to employment. (4) Furlough. An active city employee who is subject to a city mandated furlough during the period beginning on July 1, 2009, and ending on June 30, 2010, shall be credited with accrued service for the furlough period(s), up to a maximum of seventy-two (72) hours of accrued service credit. This shall include reductions in pay which correlate with furlough hours. Sec. 22-36(c). Transfers from other Arizona Systems. (1) ASRS. A contributing member who has service credits in the Arizona State Retirement System may have such retirement service credits transferred to the system in accordance with Arizona Revised Statute Sections 38-730, as amended. In no event shall any transfer of service credit processed in accordance with this section create a significant detriment to the funded status of the system. Any service credit transferred pursuant to this section shall be accrued service hereunder. (2) Other systems. A contributing member who has service credits in a public retirement system maintained by the State of Arizona (other than ASRS) or any municipality of the State of Arizona may have such retirement service credits transferred to the system in accordance with Arizona Revised Statute Sections 38-923 and 38-924, as amended. In no event shall any transfer of service credit processed in accordance with this section cause the system to incur any unfunded accrued liabilities as a result of the transfer. Any service credit transferred pursuant to this section shall be additional service hereunder. Sec. 22-36(d). Additional service--Unpaid authorized leave from city employment. A member who has not requested a refund from the system in accordance with section 22-41 may purchase up to one (1) year of additional service for any period of unpaid authorized leave from city employment (excluding furloughs). To purchase such additional service, a member shall pay to the system the contribution cost associated with the leave period, determined based on the compensation imputed in accordance with section 22-43(c) and the member and employer contribution rates in effect during the leave period. Any election to purchase additional service pursuant to this section must be completed within six (6) months of the termination of the leave period. A member may pay the costs associated with a purchase of additional service under this section by any method described in section 22-36(g) below. Sec. 22-36(e). Additional service – Prior government or military service. Subject to the provisions of section 22-36(g), a member who has not requested a refund of the member's accumulated contribution account or filed a retirement application may elect to purchase additional service in the system for periods of prior government or military service. Additional service will be used for benefit accrual purposes only, and will not be considered in the determination of whether a member is vested. Any member wishing to purchase additional service shall furnish all documentation required by the system administrator, in its discretion, to substantiate the prior service at the time of making an application to purchase the additional service. This provision shall govern the repurchase of prior city service credit forfeited upon receipt of a refund pursuant to section 22-41, subject to the special redeposit rules of section 22-36(h). It is the stated and declared purpose of this section to allow for the purchase of all prior government or military service for which a member is not entitled to receive, presently or in the future, a benefit from another retirement system. To this end, the provisions of this section shall be liberally construed. Sec. 22-36(f). Additional service – Nonqualified permissive service credit. Subject to the provisions of section 22-36(g), any vested member who is actively contributing to the system may purchase additional service for nonqualified service in accordance with Code Section 415(n)(3). Effective January 1, 2011, the purchase of nonqualified permissive service shall be limited to a total of five (5) years, regardless of the member's payment method and notwithstanding the special rules set forth in Code Section 415(n) regarding direct rollovers and transfers from Code Section 403(b) and 457 plans. For purposes of the foregoing five (5) year limitation on permissive service purchases, additional service purchased by a member prior to January 1, 2011, shall be taken into account. Sec. 22-36(g). Purchase terms for additional service. The cost and method of purchasing any additional service in accordance with section 22-36(e) or section 22-36(f) above shall be determined pursuant to this section. (1) Cost to purchase. Purchases of additional service are designed and administered in a manner intended to prevent the system from incurring any unfunded accrued liability as a result of the purchase. The cost for each year of additional service purchased shall equal a percentage of the member's highest annual salary, as determined in accordance with a purchase of service credit table designed by the system's actuary and approved by the board. An administrative fee as determined by the board shall be imposed for the processing of purchase of service requests. The date of purchase shall be the day the member delivers to the system administrator an executed irrevocable purchase of service agreement. (2) Payment for time purchased. A member may fund the purchase of additional service with one or a combination of the following payment methods: (A) payment of after-tax cash lump sum; (B) tax-deferred rollover contribution from a tax-qualified retirement plan or individual retirement account(s) as authorized by the Code; (C) after-tax payroll deduction agreement; or (D) irrevocable pre-tax payroll deduction agreement designed to comply with the employer pick-up arrangement requirements of Code Section 414(h) Sec. 22-36(h). Reentry into service. A former member who reenters service shall become a member of the system in accordance with section 22-33(e). If the member's accumulated contributions account has not been refunded and his accrued benefit has not been transferred in accordance with section 22-41, credited service shall be given for all prior accrued and additional service. A former member who reenters service within twenty-four (24) months and who received a refund of his accumulated contributions account pursuant to section 22-41 shall, upon redeposit of the amount withdrawn plus applicable interest, as determined by the system administrator, be credited with all prior credited service. Any redeposit made in accordance with this provision must be completed within six (6) months of the former member's reentry into service. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 10696, § 2, 8-5-09, eff. 7-1-09; Ord. No. 10775, § 1, 4-6-10; Ord. No. 10915, § 4, 6-21-11, eff. 7-1-11; Ord. No. 11327, §§ 6, 7, 12-8-15, eff. 1-1-16; Ord. No. 11795, § 2, 10-20-20) Editor's note – Section 8 of Ord. No. 10915, adopted June 21, 2011, provides that the amendments made to Sec. 22-36(f) are effective retroactively to July 1, 2009.

Tucson Code § 22-37 Retirements.

Sec. 22-37. Retirements. Sec. 22-37(a). Retirements generally. (1) Types of service retirements. Subject to the minimum requirements set forth in paragraph (a)(2) below, there are three (3) types of service retirements available under the system: (A) Normal retirement. Members are eligible to receive a normal retirement benefit upon attainment of the applicable (A) retirement points rule or (B) normal retirement age. (B) Early retirement. Tier I members are eligible to receive an early retirement benefit after completing twenty (20) years of credited service and attaining age fifty-five (55). Tier II members are eligible to receive an early retirement benefit after completing twenty (20) years of credited service and attaining age sixty (60). (C) Deferred retirement. Vested members who experience a termination date before reaching normal or early retirement eligibility are eligible for deferred retirement and the member's accrued benefit is paid when the member later becomes eligible for normal or early retirement. (2) Minimum requirements. In addition to the standard eligibility conditions set forth above, all members hired on or after July 1, 2009, must complete at least five (5) years of accrued service before reaching normal or early retirement eligibility under section 22-37(a)(1)(A) or (1)(B) above. Sec. 22-37(b). Early retirement. The early retirement pension shall be calculated in the same manner as the normal retirement benefit and shall be reduced in accordance with this paragraph to reflect the earlier and longer benefit payment period. The early retirement reduction shall equal one-half of one (0.5) percent for each month prior to the date the member would have attained the applicable retirement points rule (rule of 80 or rule of 85). For purposes of this section, the date the member would have attained the applicable retirement points rule shall be determined based on the assumption that the member will earn additional age related points but will not earn additional points for years of credited service. Sec. 22-37(c). Deferred retirement. As of a termination date, a vested member shall be deemed to have elected a deferred retirement calculated in the same manner as the normal retirement benefit or the early retirement benefit and payable upon the member's satisfaction of the conditions for normal or early retirement, as set forth in paragraph (a) above. A member who is in deferred retirement status and who has not reentered city service may request a refund of his accumulated contributions account any time before the payment of retirement benefits commence. Sec. 22-37(d). Payment of benefits; deferred commencement. Retirement benefits are paid monthly in arrears. Generally, a member may delay the date payments begin as permitted by law provided; however, that no actuarial adjustment or retroactive adjustment shall be made to the retirement benefit as a result of the delayed commencement. Notwithstanding the foregoing, if a member delays commencement of retirement benefits beyond normal retirement age, by affirmative election or failure to file a retirement application, an actuarial adjustment to the retirement benefit shall be made to reflect only the delayed commencement after the normal retirement age. Sec. 22-37(e). Retirement application; withdrawal of retirement application. A member may submit an application for retirement benefits within ninety (90) days of the member's proposed termination date or, if applicable, the member's proposed end of service participation date, subject to the system administrator's discretion to make nondiscriminatory timing exceptions as necessary. Except as required by law, no retirement benefits shall commence under the system until a member files a retirement application with the system administrator and the retirement application is ratified by the board. The board's ratification of any retirement benefit application may be based on a reasonable estimate of the member's retirement benefit, as prepared by the system administrator. In the event that a member's actual retirement benefit varies significantly from an estimate presented to the board for ratification, the system administrator shall present the actual retirement benefit calculation to the board for its reconsideration as soon as administratively feasible. Any application for an early, normal, deferred or disability retirement may be withdrawn at any time prior to ratification by the board. Sec. 22-37(f). Post retirement benefit payments. The board shall determine, pursuant to its formal policy and in its discretion, whether the system shall fund an annual supplemental post retirement benefit payment to retired members and beneficiaries. The board's formal policy shall include the methods and procedures to be followed by the board in making its annual determination. The policy shall include the requirements that allocations to a post retirement benefits reserve shall not occur in years where any of the following conditions occur: the actuarial target funded ratio for that year is not achieved, there are no excess returns (based on the rolling average), or the allocation to a post retirement benefits reserve would directly cause an increase in the annual required contribution for that year. Sec. 22-37(g) Suspension of pension benefits upon reemployment. Retirement benefits payable to a retired member shall be suspended during the retired member's period of reemployment with the city unless (1) at least twelve (12) months have elapsed between the member's retirement from the city and the retired member's reemployment date; and (2) the retired member is engaged to work in a non-permanent employment classification. The retired member shall be permitted to work in consecutive or successive non-permanent employment classifications without triggering a suspension of retirement benefits provided that (A) the member satisfied the twelve (12) month break rule set forth above; (B) the non-permanent employment classifications are separate and distinct employment positions; and (C) the retired member's period of continuous reemployment does not exceed eighteen (18) months. In no event shall any re-employed retired member acquire credited service or credited compensation or contribute to the system. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 10915, § 5, 6-21-11, eff. 7-1-11; Ord. No. 11327, §§ 8, 9, 12-8-15, eff. 1-1-16; Ord. No. 11515, § 1, 12-19-17; Ord. No. 11595, §§ 3, 4, 10-23-18)

Tucson Code § 22-38 End of service program.

Sec. 22-38. End of service program. Sec. 22-38(a). Purpose. The end of service program allows retirement eligible members to earn lump sum benefits in addition to the members' retirement benefit, in exchange for a waiver of up to twelve (12) months of additional benefit accruals under the system. The end of service program is entirely voluntary. Sec. 22-38(b). Eligibility for end of service program. Any member eligible for normal retirement may elect to participate in the end of service program by entering into a participation agreement in accordance with section 22-38(c) and accepting the terms and conditions of the end of service program. Participation in the end of service program shall remain open only until December 31, 2010, and no members shall be permitted to enroll in the end of service program after that date. Sec. 22-38(c). Irrevocable agreement to participate. A member's agreement to participate in the end of service program is (1) a voluntary agreement to forego benefit accruals under the retirement provisions of the system, (2) a voluntary election to terminate from employment with the city before or upon completion of the end of service program participation period and (3) a retirement application for purposes of section 22-37(e). The member's participation election shall be evidenced by the member's execution of the board's end of service program agreement and shall include the member's proposed effective date of participation. The member's effective date of participation in the end of service program shall be the later of the first day of the month following the board's ratification of the member's end of service participation agreement or the participation date selected by the member and approved by the system administrator. The system administrator may, in its discretion, adopt reasonable and uniform procedures governing the deadlines for submission of end of service participation agreements and the acceleration of end of service participation dates. A member's agreement to participate in the end of service program shall be irrevocable upon ratification by the board. Sec. 22-38(d). Cessation of benefit accrual. On the date the member begins to participate in the end of service program, mandatory member contributions to the system cease and all benefit accruals under the system terminate. A member's final average monthly compensation and credited service are determined as of the member's end of service participation date and shall not increase or decrease thereafter. The member also is not entitled to receive any retirement benefit increases implemented during the end of service participation period. Sec. 22-38(e). Accumulation of end of service benefits. End of service program benefits will be credited to an end of service program account established under the system and shall be paid to the member following the member's termination date at the same time and in the same manner as otherwise prescribed in this article. A member's end of service program participation account shall be credited with the following: (1) An amount, credited monthly, that is computed in the same manner as a normal retirement benefit using the member's credited service, average final monthly compensation and retirement benefit payment elections as of the member's effective date of end of service program participation. (2) An amount, credited monthly, that represents assumed earnings at a rate determined by the board, annually at the beginning of the plan year. As of the effective date of the end of service program, the earnings rate credited pursuant to this section is the ninety-day treasury bill rate. Sec. 22-38(f). Termination of end of service program participation. Participation in the end of service program terminates on the first occurrence of either of the following: (1) twelve (12) months from the date of entry; or (2) the member's termination date. If a member's participation in the end of service program is terminated as a result of the city's just cause termination of the member's employment and such just cause is later reversed, a member's participation in the end of service program, minus any benefits previously distributed pursuant to this article, shall be reinstated for the duration of the original end of service program participation period designated by the member on the appropriate end of service program participation form. Upon termination of the member's end of service program participation, the retirement benefit payable to any member who fails to terminate in connection with the end of service program shall commence in accordance with the retirement provisions of this article. Notwithstanding the foregoing, if a member fails to terminate from employment with the city at the end of the member's end of service program participation period, the member shall forfeit all rights to any end of service benefits and assumed earnings and shall not accrue any additional credited service during the end of service participation period. Sec. 22-38(g) Payment of end of service program benefits. Following termination of the member's participation, a member is entitled to receive a lump sum distribution of all amounts credited to the member's end of service program participation account. The end of service program distribution shall be processed in accordance with section 22-43(g). The member also shall commence receipt of retirement benefits, calculated and paid in accordance with the retirement provisions of the system. If a member dies during the end of service program participation period, all amounts in the member's end of service program participation account shall be paid to the member's beneficiary. If the beneficiary(ies) predecease the member, all distributions pursuant to the end of service program shall be paid to the member's spouse, if the member was married at death, or to the legal representative of the member's estate, if the member is not married at death. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09)

Tucson Code § 22-39 Disability retirement.

Sec. 22-39. Disability retirement. Sec. 22-39(a). Qualification. If a member is not yet eligible for normal retirement, the member may apply for disability retirement benefits. To be eligible to receive disability retirement benefits, the member must (1) apply for disability retirement benefits within twelve (12) months of the date of termination from employment; (2) be credited with ten (10) or more years of accrued service, inclusive of accrued vacation and sick leave; (3) establish that he or she terminated from employment with the city as a result of disabling mental or physical impairment; and (4) be determined, in accordance with applicable rules, to have a total and permanent disability. Sec. 22-39(b). Application process. An application for disability retirement benefits may be filed by the member in accordance with the policies and procedures of the system administrator. Unless waived by the board in light of a Social Security Administration determination of total and permanent disability, the board's physician shall examine the member and certify in a written report to the board whether the member suffers from a total and permanent disability. The report shall also state when the member should be reexamined. If the board determines that the member should receive disability retirement benefits, the disability retirement benefits shall commence as of the date determined by the board in its discretion. Disability retirement benefits shall not be paid for periods the member elects to receive sick and vacation leave pay. Sec. 22-39(c). Disability benefit. Disability retirement benefits are calculated in the same manner as normal retirement benefits, with no reduction for early commencement. Sec. 22-39(d). Termination of disability benefit. A disability retirement benefit shall be terminated by the board upon a determination that the member no longer suffers from a total and permanent disability or upon the member’s reemployment with the city. If the member reenters city service, any credited service included in the calculation of the disability retirement benefit shall be restored to the member’s credit; but the member’s accrued benefit shall be subject to an actuarial reduction at the time of retirement based on the number of months that the member received disability retirement benefits. The excess, if any, of the member’s accumulated contributions as of the date of total and permanent disability over the aggregate of the disability retirement benefits received by the member shall be credited to the member’s accumulated contributions account. Sec. 22-39(e). Requirements to maintain disability benefit. The member shall provide to the system administrator no later than May 31 of each calendar year all information requested by the system administrator regarding the member’s total and permanent disability. The board may suspend disability retirement benefits if the member fails to provide any of the required information. Following the retirement of a member as the result of a total and permanent disability, the board may require the member, prior to the member’s eligibility for normal retirement and no more frequently than annually, to undergo a medical examination by a licensed physician, as directed by the system administrator. Should the member refuse, the member’s disability retirement benefit shall be discontinued until such time as they submit to the required examination. Should the refusal continue for one (1) year, all rights to any further disability retirement benefits shall cease. Upon the member attaining the age required for a normal retirement, no further medical exams will be required. Sec. 22-39(f). Prior requirements to maintain disability benefit. Any member who qualified for a disability retirement prior to July 1, 2009, is subject to the benefit limitations and disability verification requirements of this subsection, as well as the nondiscriminatory policies and procedures of the system administrator. (1) Disability verification requirements. Not later than May 31 of each calendar year, the member shall provide to the system administrator all information requested by the system administrator regarding the member’s earned income (wages and self-employment income) for the previous calendar year. The board may suspend disability retirement benefits if the member fails to provide any of the required information. Following the disability retirement of a member, the board may require the member to undergo a medical examination by a licensed physician. Should the member refuse, the disability retirement benefit shall be discontinued until such time as the member submits to the required examination. Should the refusal continue for one (1) year, all rights to any further disability retirement benefits shall cease. Upon the member’s attainment of the age required for receipt of a normal retirement benefit, no further medical exams or information relating to earned income will be required. (2) Disability benefit adjustments. (A) Earned income based adjustment. Based on the verification procedures described above, the disability retirement benefit may be subject to annual adjustment in accordance with this section. If the member’s earned income for the preceding calendar year exceeded fifty (50) percent of the member’s adjusted income base for that calendar year, then the member’s disability retirement benefit will be reduced during the twelve-month period commencing on the effective date of the system administrator’s adjustment (the “adjustment period”) as follows. The monthly disability retirement benefit payable in the adjustment period will be reduced by one-twelfth (1/12) of the excess of the member’s earned income for the preceding calendar year over fifty (50) percent of the member’s adjusted income base. If the adjustment required by the preceding sentence would reduce the monthly disability retirement benefit to a negative amount, the disability retirement benefit shall be suspended for the adjustment period and any excess amount not offset by the disability retirement benefit suspension shall be taken into account in the next annual adjustment procedure. From time to time, the board also may increase or decrease the member’s disability retirement benefit to recapture overpayments or to restore any deficiencies in payments to the member which may have accrued prior to the board’s receipt of information under the disability verification procedures. When a member becomes eligible for a normal retirement benefit, no further adjustments shall be made. (B) Earned income and/or worker’s compensation benefits. In the event a disabled member receives earned income and/or worker’s compensation benefits during the calendar year, that member’s disability retirement benefit may be adjusted so that the member’s total income received from employer provided benefits does not exceed 100% of the members’ adjusted income base. Any adjustment made shall only be up to the amount of the full disability retirement benefit paid by TSRS. For purposes of this paragraph, employer provided benefits means social security benefits, worker’s compensation payments, TSRS pension benefits or long term disability payments. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 10696, § 3, 8-5-09, eff. 7-1-09; Ord. No. 10775, § 2, 4-6-10, eff. 7-1-10; Ord. No. 11327, §§ 10, 11, 12-8-15, eff. 1-1-16)

Tucson Code § 22-40 Death benefits.

Sec. 22-40. Death benefits. Sec. 22-40(a). Generally. (1) If the member dies prior to the board's ratification of the member's application for retirement benefits, if any, the death benefit or survivor annuity payable as the result of the member's death shall be determined in accordance with this section. If the member dies after the board has ratified the member's application for retirement benefits, including an end of service participation agreement, any survivor benefits payable as a result of the death of the member shall be determined in accordance with the member's retirement benefit payment election. Notwithstanding any other provision herein to the contrary, a member who satisfied the conditions for normal or early retirement and filed the appropriate paperwork with the system administrator to pre-select retirement benefits prior to July 1, 2009, shall be treated as a member whose application for retirement benefits has been ratified by the board for purposes of this paragraph. (2) If a member dies while performing qualified military service on or after January 1, 2007, the member shall be treated as if he returned to employment with the city on the day before the date of death. Sec. 22-40(b). Spouse as beneficiary. If the spouse is the member's beneficiary and the spouse dies before the death benefit is paid, the available death benefit shall be paid to the beneficiary of the spouse, and if none, then to the legal representative of the spouse's estate. Sec. 22-40(c). Death before vested interest. Should a member with less than five (5) years of accrued service die, the member's accumulated contributions account balance, determined as of the member's date of death, shall be paid in a lump sum to the member's beneficiary. If the beneficiary(ies) predeceases the member, the member's accumulated contributions account balance shall be paid to the member's spouse, if the member was married at death, or to the legal representative of the member's estate, if the member is not married at death. Sec. 22-40(d). Death after vested interest. If a member who is credited with five (5) or more years of accrued service dies before reaching normal or early retirement, a death benefit will be paid to the member's beneficiary(ies). If the beneficiary(ies) predeceases the member, the death benefit shall be paid to the member's spouse, if the member was married at death, or to the legal representative of the member's estate, if the member is not married at death. Sec. 22-40(e). Death while eligible for retirement. If a vested member dies after attaining normal or early retirement eligibility (determined in accordance with sections 22-37(a)(1)(A) or (B), as applicable) but prior to the board's ratification of the member's application for retirement benefits, a death benefit or survivor annuity will be paid as follows: (1) Default for spouse. If the member's spouse is the beneficiary (and except as set forth in paragraph (3) below), a survivor annuity will be paid to the spouse and will equal the benefit the spouse would have received if the member had retired on the day before death and had elected to receive a joint and 100% survivor annuity. In determining the amount of the survivor annuity, the retirement benefit payable on account of the member's presumed retirement shall be calculated in accordance with the early retirement reduction provisions of section 22-37(b), if applicable. The survivor annuity described in this paragraph is payable only to a spouse of a deceased member. (2) Default for single non-spouse beneficiary. If the member has designated a single individual person other than a spouse as the beneficiary, a survivor annuity will be paid to the beneficiary and will equal the benefit the beneficiary would have received if the member had retired on the day before death and had elected to receive an annuity certain and for life with a period certain of one hundred eighty (180) months, commencing in the month following the date of the member's death and paid until the end of the period certain. If the beneficiary dies prior to the completion of the period certain, a one-time lump sum payment equal to the present value of the remaining period certain payments to the estate of the beneficiary. In determining the amount of the survivor annuity, the retirement benefit payable on account of the member's presumed retirement shall be calculated in accordance with the early retirement reduction provisions of section 22-37(b), if applicable. (3) Default for multiple beneficiaries, trusts and estates. The survivor annuities described in paragraphs (1) and (2) above are payable only to a spouse or single person designated as a beneficiary. If the member has designated multiple beneficiaries, a death benefit will be paid to the multiple beneficiaries in accordance with the member's designation, regardless of whether the spouse is named as one of the multiple beneficiaries. If the member has designated a trust or an estate as a beneficiary, or an estate is the default beneficiary under the terms of section 22-33(f), the trust or estate shall be entitled to receive a death benefit only, and shall not receive a survivor annuity, regardless of whether the member's spouse is a beneficiary of the trust and regardless of whether the trust or estate has only one beneficiary. (4) Death benefit election. A spouse or single beneficiary entitled to receive a survivor annuity under paragraph (1) and (2) above may elect, in his or her discretion, to waive the survivor annuity and receive a death benefit. To make the death benefit election, the spouse or beneficiary shall sign a statement acknowledging that the survivor annuity and death benefit options have been satisfactorily explained and shall make a written election to receive the death benefit, all in accordance with the policies and procedures of the system administrator. Sec. 22-40(f). Refund guarantee. A member who elects a single life annuity pursuant to section 22-42(b) or a joint and survivor annuity pursuant to section 22-42(c) shall be guaranteed a refund if the named recipients on the selected annuity die before the monthly retirement benefits paid equal or exceed two (2) times the value of the member's accumulated contributions with interest at time of retirement. The amount of the refund shall equal two (2) times the value of the member's accumulated contributions account at the time of retirement, reduced by the retirement benefits paid to date (the "refund amount"). If the member elected a single life annuity and the member dies, or the member elected a joint and survivor annuity and both the member and the named survivor die, the member's beneficiary (or the member's estate, if the beneficiary is not then living) will receive the refund amount. Sec. 22-40(g). Payment following death. Following the death of a member, the system administrator will notify the beneficiary(ies) or the surviving spouse, as applicable, regarding the right to receive a refund of member contributions, a death benefit or a survivor annuity. Any lump sum benefit available to a spouse or beneficiary(ies) under this article shall be paid in accordance with sections 22-43(f) and (g). (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 10696, § 4, 8-5-09, eff. 7-1-09; Ord. No. 10711, § 3, 9-9-09, eff. 7-1-09; Ord. No. 10712, § 3, 9-9-09, eff. 7-1-09; Ord. No. 10915, § 6, 6-21-11, eff. 7-1-11; Ord. No. 11327, § 12, 12-8-15, eff. 1-1-16; Ord. No. 11595, § 5, 10-23-18) Editor's note – Section 8 of Ord. No. 10915, adopted June 21, 2011, provides that the amendments made to Sec. 22-40(f) are effective retroactively to July 1, 2009.

Tucson Code § 22-41 Refund of accumulated contributions accounts; transfers to other systems.

Sec. 22-41. Refund of accumulated contributions accounts; transfers to other systems. Sec. 22-41(a). Member's request for refund. A member may request a refund of the member's accumulated contribution account following the member's termination date by filing the appropriate refund application with the system administrator. If the member was dismissed from city service, the member's application for a refund shall not be approved and disbursed until the member's separation from employment with the city becomes final and is no longer subject to any administrative or judicial review. Sec. 22-41(b). Refund to Non-Vested Member. Any Member who terminates from City service prior to becoming a Vested Member shall cease to be a Member and shall be eligible to request a refund of his Accumulated Contributions Account as set forth in Section 22-33(c). The System Administrator shall contact the former Member as soon as reasonably possible following the Termination Date and shall provide information regarding the available refund. In the event that the former Member's termination is subject to administrative or judicial review, no refund shall be processed until such termination is final and binding. In the event the former Member does not consent to receipt of the refund of the Member's Accumulated Contributions Account within a reasonable period following notification by the System Administrator and the Member's Accumulated Contributions Account balance is more than one thousand dollars ($1,000.00), but does not exceed five thousand dollars ($5,000.00), the System Administrator may transfer the Accumulated Contributions Account balance to an individual retirement account established for the benefit of the Member in accordance with Code Section 401(a)(31)(B). If the Member's Accumulated Contributions Account balance equals one thousand dollars ($1,000.00) or less and the Member fails to consent to receipt of the refund, the System Administrator may, in its discretion, issue a refund check to the Member without the Member's consent. If the Member's Accumulated Contributions Account balance equals five thousand dollars ($5,000.00) or more and the former Member fails to consent to receipt of the refund, the System Administrator shall hold the Accumulated Contributions Account in the System for a period of three (3) years from the Termination Date, at which time the System Administrator shall escheat the Accumulated Contributions Account to the State of Arizona. The amount escheated to the State of Arizona shall not include Interest credited to the Accumulated Contributions Account after the Termination Date. Sec. 22-41(c). Beneficiary's request for refund. Upon the death of a member, a beneficiary may request a refund of the member's accumulated contributions account or a death benefit. The beneficiary's right to receive a refund or a death benefit shall be determined in accordance with the provisions of this chapter and such determination shall take into account any retirement benefit payments made to the member prior to death, if any. Sec. 22-41(d). Transfer to other Arizona Systems. Following a member's termination date and prior to the member's retirement or request for a refund of the member's accumulated contribution account, the member may request a transfer of the member's vested accrued benefit and/or the member's accumulated contributions account to a public retirement system maintained by the State of Arizona or any municipality of the State of Arizona, to be processed in accordance with Arizona Revised Statute Sections 38-730, 38-923 and 38-924, as amended. A transfer from the system shall not cause the system to incur any unfunded accrued liability, except in the case of a transfer to the Arizona State Retirement System in accordance with the reciprocity rules in effect with regard to transfers between the system and ASRS and which shall not cause any significant detriment to the funded status of the system. Sec. 22-41(e). Forfeiture of credited service and tier I status. Any refund or transfer of a member's accumulated contributions account or a transfer of member's accrued benefit shall trigger an immediate forfeiture of all credited service earned by the member. In the case of a vested member, a refund or transfer under this section 22-41 and the related forfeiture of credited service will result in the loss of the member's (or beneficiary's) retirement pension rights under the system. If a former member requests a refund of the member's accumulated contributions account or a transfer of the member's accrued benefit, the former member shall forfeit any and all rights to tier I member status and, if the former member is rehired by the city, may reenter the system only as a tier II member, subject to all applicable participation requirements. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 10915, § 7, 6-21-11, eff. 7-1-11; Ord. No. 11020, § 3, 9-11-12, eff. 7-1-09)

Tucson Code § 22-42 Retirement benefit payment options.

Sec. 22-42. Retirement benefit payment options. Sec. 22-42(a). Explanation of benefit options. A member who is eligible to receive a retirement benefit may request from the system administrator information regarding the retirement benefit payment options available. No pension is automatically payable hereunder, except as provided in section 22-40, death benefits, and all eligible members must make appropriate retirement elections under the system. The member and spouse, if any, shall sign a statement acknowledging that the retirement benefit payment options have been satisfactorily explained and shall make a written election of one (1) of the retirement benefit payment options. All elections shall be made in accordance with the policies and procedures of the system administrator, and any spousal consent shall be provided in accordance with section 22-33(f)(1). The benefit election can be revoked or changed by the member by filing a written notice of revocation or change with the system administrator, subject to any applicable spousal acknowledgement requirements, any time prior to ratification of the retirement benefit by the board. The benefit election is irrevocable upon board ratification of the member's application for retirement benefits. Sec. 22-42(b). Single life annuity. A member eligible for retirement may elect to receive his retirement benefit payable in a single life annuity, ending with the monthly payment made in the month of the member’s death. The single life annuity shall be the normal form of benefit for purposes of calculating the retirement benefits under the system. Any election of an alternative annuity option under the system shall result in the payment of an annuity which is the actuarial equivalent of the single life annuity payable to the member. Sec. 22-42(c). Joint and survivor annuity. A member eligible for retirement may elect to receive his retirement benefit payable in a joint and survivor annuity which provides payments to the member for the remainder of the member's life and then provides payments to the surviving beneficiary for the remainder of the beneficiary's life. In making this election, the monthly benefit to be paid to the surviving beneficiary following the death of the member may be one hundred percent (100%), seventy-five percent (75%) or fifty percent (50%) of the monthly benefit the member had been receiving. All payments will cease upon the death of the member or the beneficiary, whichever shall occur last. The member's designation of a beneficiary to receive any survivor benefit payable under a joint and survivor annuity shall be subject to the requirements of section 22-43(f) and Code section 401(a)(9), including the limitations on non-spouse beneficiaries, any joint and survivor annuity election shall be adjusted as necessary for compliance with the Code. Sec. 22-42(d). Annuity certain and for life. A member eligible for retirement may elect to receive his retirement benefit payable in an annuity for a term certain and for life. This benefit allows a member to ensure payment of a benefit over the member’s lifetime, and in the event of the member’s death before the end of a “period certain,” continuing payment of the benefit until the end of the “period certain” to a surviving beneficiary or contingent beneficiary. A member may elect to receive a term certain annuity with a guaranteed payment period of sixty (60) months, one hundred twenty (120) months or one hundred eighty (180) months. For purposes of the annuity for a term certain and for life, the guaranteed payment period shall begin with the earlier of the first monthly benefit payment made to the member or the first monthly end of service program accrual, if applicable. Should the member live beyond the period certain elected, no survivor benefits shall be paid to the member’s beneficiary(ies). Should the member, the beneficiary and any contingent beneficiary die before the expiration of the term certain, the board shall make a one-time lump sum payment equal to the present value of remaining period certain payments to the estate of the person last receiving a benefit under the annuity. Sec. 22-42(e). Failure to elect benefit option or commencement date. Failure to elect a benefit option will result in the member receiving a single life annuity, assuming the member survives until the pension commencement date. Failure to elect a date on which payment begins will result in payments made in accordance with the minimum required distribution provisions of section 22-43(e) and Code Section 401(a)(9). Notwithstanding the foregoing, the provisions of section 22-40 apply when a vested member dies while eligible for retirement and prior to the board’s ratification of the member’s application for retirement benefits. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 10711, § 4, 9-9-09, eff. 7-1-09; Ord. No. 10712, § 4, 9-9-09, eff. 7-1-09; Ord. No. 11327, §§ 13, 14, 12-8-15, eff. 1-1-16; Ord. No. 11595, § 6, 10-23-18)

Tucson Code § 22-43 Administration of benefit payments; benefit calculations.

Sec. 22-43. Administration of benefit payments; benefit calculations. Sec. 22-43(a). Payment of small accounts. If the accrued benefit of a member, including any refund of an accumulated contributions account, has a present value of five thousand dollars ($5,000.00) or less at the time the benefit becomes payable, a lump sum distribution shall be paid to the member within thirty (30) days following their benefit election and the satisfaction of any applicable spousal consent requirements. Sec. 22-43(b). Special rules for members with part-time employment. When a member has earned accrued service during part-time employment or both full-time and part-time employment, the monthly retirement benefit, in the form of benefit elected, will be computed using the following special rules. (1) Special rules for computing average final monthly compensation for a member who had part-time or both full-time and part-time employment. Average final monthly compensation shall be determined by: (A) For periods of full-time hours worked, the average of the highest thirty-six (36) consecutive months of compensation of the last one hundred twenty (120) consecutive months of compensation divided by thirty-six (36), or if the member has less than thirty-six (36) consecutive months of compensation divided by the actual number of months of compensation. (B) For periods of part-time hours worked, the average of the highest annualized thirty-six (36) consecutive months of compensation of the last one hundred twenty (120) consecutive months of compensation divided by thirty-six (36), or if the member has less than thirty-six (36) consecutive months of compensation divided by the actual number of months of compensation. (2) Special rules for computing annualized months of compensation for a member who had a part-time or both full-time and part-time employment. (A) Determine the actual compensation paid to an employee during a two thousand eighty-hour (2,080) period in any consecutive twelve-month calendar period. (B) Divide the actual number of hours for which an employee was compensated by two thousand eighty (2,080). (C) Divide the result obtained in "A" by the result obtained in "B." Annualized monthly compensation shall be the result obtained under "C" divided by twelve (12). Sec. 22-43(c). Special rule for members with authorized leave without pay. When a member has taken authorized leave without pay, including periods of qualified military service, the member's average final monthly compensation shall be computed by imputing compensation for the authorized leave period, at the compensation rate in effect for the member immediately preceding the commencement of the leave period. For the period beginning on July 1, 2009, and ending on June 30, 2010, furlough periods shall be considered periods of authorized leave without pay for purposes of this section 22-43(c). Sec. 22-43(d). Limitation on compensation. In no event may the compensation of a member considered under this system exceed the limit set forth in Section 401(a)(17) of the Code, as adjusted for cost-of-living increases in accordance with Code Section 401(a)(17)(B). The cost-of-living adjustment in effect for a calendar year applies to any fiscal year period, not exceeding twelve (12) months, over which compensation is determined beginning in such calendar year. Sec. 22-43(e). Maximum benefit allowable. Notwithstanding anything hereunder to the contrary, the annual benefit payable to a member in the form of a straight life annuity shall not exceed the annual dollar limitation in effect under Code Section 415(b), as adjusted in accordance with paragraph (1) below (the "annual dollar limitation"). For the 2009 Limitation Year, the annual dollar limitation is $195,000.00. If the benefit the member would otherwise accrue in a limitation year would produce an accrued benefit in excess of the annual dollar limitation, the benefit shall be limited (or the rate of accrual reduced) to a benefit that does not exceed the annual dollar limitation. For purposes of this section, the annual benefit shall not include the annual benefit attributable to either mandatory member contributions or rollover contributions. (1) Cost of living adjustments. The annual dollar limitation shall be adjusted for each calendar year to take into account any cost-of-living increase adjustments for that calendar year allowable pursuant to applicable regulations or rulings of the United States Treasury Department under Section 415(d) of the Code. Any such adjustment shall be effective only as of the first day of the calendar year for which such adjustment is announced. Cost-of-living adjustments to the annual dollar limitation made after a member retires shall apply to that member, provided that in no event shall such cost-of-living adjusted amounts exceed the Code Section 401(a)(17) limitation on compensation for that member determined as of the member's termination of employment. (2) Minimum benefits. Notwithstanding anything else in this section to the contrary, the benefit otherwise accrued or payable to a member under the system shall be deemed not to exceed the annual dollar limitation if: (A) The benefits payable for a limitation year under any form of benefit with respect to such member do not exceed ten thousand dollars ($10,000.00) multiplied by a fraction: (i) the numerator of which is the member's number of years (or part thereof, but not less than one (1) year) of credited service (not to exceed ten (10)), and (ii) the denominator of which is ten (10); and (B) The city has not at any time maintained a defined contribution system in which the member participated (for this purpose, mandatory employee contributions under a defined benefit system are not considered a separate defined contribution system). (3) Service and participation reductions. If the member has less than ten (10) years of participation in the system, the annual dollar limitation shall be multiplied by a fraction: (1) the numerator of which is the number of years (or part thereof, but not less than one (1) year) of participation in the system, and (2) the denominator of which is ten (10). (4) Early payment adjustments. The annual dollar limitation shall be adjusted if the member's benefit commencement date is before age sixty-two (62). (A) Limitation Years Beginning on or after July 1, 2007. With regard to annuities commencing in Limitation Years beginning on or after July 1, 2007 and when the Member's benefit commencement date is before age 62, the Annual Dollar Limitation for the Member's benefit commencement date shall be the annual amount of a benefit payable in the form of a straight life annuity commencing at the Member's benefit commencement date that is the actuarial equivalent of the lesser of (i) the Annual Dollar Limitation (adjusted under Section 22-43(d)(3), if required) computed using a 5% interest rate and the applicable mortality table under Code Section 417(e)(3) and expressing the Member's age based on completed calendar months as of the benefit commencement date and (ii) the Annual Dollar Limitation (adjusted under Section 22-43(d)(3), if required) multiplied by the ratio of the annual amount of the immediately commencing straight life annuity under the System at the Member's benefit commencement date to the annual amount of the immediately commencing straight life annuity under the System at age 62. (B) Limitation Years Beginning Before July 1, 2007. With regard to annuities commencing in Limitation Years beginning before July 1, 2007 and when the Member's benefit commencement date is before age 62, the annual amount of a benefit payable in the form of a straight life annuity commencing at the Member's benefit commencement date that is the actuarial equivalent of the Annual Dollar Limitation (adjusted under Section 22-43(d)(3), if required) computed using a 5% interest rate and the mortality table described in Rev. Rul. 2001-62. (C) Notwithstanding the other requirements of this Section, no adjustment shall be made to the Annual Dollar Limitation to reflect the probability of a Member's death between the Member's benefit commencement date and age 62 if benefits are not forfeited upon the death of the Member prior to the benefit commencement date. To the extent benefits are forfeited upon death before the benefit commencement date, such an adjustment shall be made. (5) Alternative benefit payment options. Except as provided below, if a benefit is payable in a form other than a straight life annuity, the benefit shall be adjusted to an actuarially equivalent straight life annuity that begins at the same time as such other form of benefit and is payable on the first day of each month, before applying the limitations of this section. (A) (i) Limitation Years Beginning on or After July 1, 2007. With regard to annuities commencing in Limitation Years beginning on or after July 1, 2007, the actuarially equivalent straight life annuity is equal to the greater of: (a) the annual amount of the straight life annuity (if any) payable to the Member under the System commencing at the same benefit commencement date as the Member's form of benefit; and (b) the annual amount of the straight life annuity commencing at the same benefit commencement date that has the same actuarial present value as the Member's form of benefit, computed using a 5% interest rate assumption and the applicable mortality table under Code Section 417(e)(3). (ii) Limitation Years Beginning Prior to July 1, 2007. With regard to annuities commencing in Limitation Years beginning prior to July 1, 2007, the actuarial equivalent straight life annuity is equal to the greater of: (a) the annual amount of a straight life annuity (if any) payable to the Member under the System commencing at the same benefit commencement date as the Member's form of benefit; and (b) the annual amount of the straight life annuity commencing at the same benefit commencement date that has the same actuarial present value as the Member's form of benefit, computed using a 5% interest rate assumption and the mortality table described in Rev. Rul. 2001-62. (6) Definitions. For purposes of this section, the term "limitation year" shall mean the calendar year beginning on January 1 and ending on December 31. The term "applicable mortality table" shall mean the mortality table prescribed by the Internal Revenue Service based on the actual experience of pension plans and projected trends in such experience. (7) Incorporation by reference. The additional requirements of Code Section 415(b) and the treasury regulations promulgated there under, as applicable to governmental plans maintained in accordance with Code Section 414(d), are hereby incorporated by reference. (8) Late Payment Adjustments. The Annual Dollar Limitation shall be adjusted if the Member's benefit commencement date is after age 65. (A) Limitation Years Beginning on or after July 1, 2007. With regard to annuities commencing in Limitation Years beginning on or after July 1, 2007 and when the Member's benefit commencement date is after age 65, the Annual Dollar Limitation for the Member's benefit commencement date shall be the annual amount of a benefit payable in the form of a straight life annuity commencing at the Member's benefit commencement date that is the actuarial equivalent of the Annual Dollar Limitation (adjusted under Section 22-43(e)(3), if required), computed with a 5% interest rate and the applicable mortality table under Code Section 417(e)(3) (and expressing the Member's age based on completed calendar months as of the benefit commencement date). (B) Limitation Years Beginning Before July 1, 2007. With regard to annuities commencing in Limitation Years beginning before July 1, 2007 and when the Member's benefit commencement date is after age 65, the Annual Dollar Limitation shall be the amount calculated in accordance with (A) above, but without adjusting the Member's age based on completed calendar months as of the benefit commencement date. (C) Notwithstanding the other requirements of this Section, no adjustment shall be made to the Annual Dollar Limitation to reflect the probability of a Member's death between age 65 and the Member's benefit commencement date if benefits are not forfeited upon the death of the Member prior to the benefit commencement date. To the extent benefits are forfeited upon death before the benefit commencement date, such an adjustment shall be made. Sec. 22-43(f). Minimum required distributions. The board and the system administrator shall make reasonable and good faith efforts to comply with the requirements of the treasury regulations promulgated pursuant to Code Section 401(a)(9), notwithstanding any provision herein to the contrary. The obligations of the board and the system administrator shall be interpreted and construed in a manner consistent with the relief afforded to governmental plans under Section 823 of the Pension Protection Act of 2006 and the Treasury Department's proposed regulations promulgated pursuant thereto, at Treas. Reg. Sec. 1.401(a)(9)-1, Q&A-2(d). When processing distributions required by Code Section 401(a)(9), the system administrator shall make reasonable and good faith efforts to begin the payment of such distributions no later than the April 1 of the calendar year following the later of the calendar year in which the member attains the age of 70½ or the calendar year containing the member's termination date. Death benefit distributions also shall be processed in accordance with a reasonable and good faith interpretation of the requirements of Code Section 401(a)(9). Sec. 22-43(g). Eligible rollover distributions. Notwithstanding anything herein to the contrary, the member or distributee may elect to have any portion of an eligible rollover distribution received from the system paid directly to an eligible retirement plan. An eligible rollover distribution shall be made pursuant to the requirements of Code Section 401(a)(31) and Code Section 402, and the applicable regulations promulgated there under, and in the manner prescribed by the board. (1) Distributee. A "distributee" includes a member or former member. In addition, the member's or former member's surviving spouse and any alternate payee under a domestic relations order, are distributees with regard to the interest of the spouse or former spouse. A distributee also includes the member's non-spouse designated beneficiary. In the case of a non- spouse beneficiary, the direct rollover may be made only to an individual retirement account or annuity described in Section 409(a) or Section 408(b) of the Code that is established on behalf of the designated beneficiary and that will be treated as an inherited IRA pursuant to the provisions of Section 402(c)(11) of the Code. Section 402(c)(11) of the Code provides that a direct rollover of a distribution to a non-spouse beneficiary is a rollover of an eligible rollover distribution only for purposes of Section 402(c) of the Code. Accordingly, the distribution to a non-spouse beneficiary is not subject to the direct rollover requirements of Section 401(a)(31) of the Code, the notice requirements of Section 402(f) of the Code, or the mandatory withholding requirements of Section 3405(c) of the Code. (2) Eligible retirement plan. An "eligible retirement plan" is an eligible plan under Section 457(b) of the Code which is maintained by a state, political subdivision of a state, or an agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from the system, an individual retirement account described in Section 408(a) of the Code, an individual retirement annuity described in Section 408(b) of the Code, an annuity plan described in Section 403(a) of the Code, an annuity contract described in Section 403(b) of the Code, or a qualified plan described in Section 401(a) of the Code, that accepts the distributee's eligible rollover distribution. The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to an alternate payee under a domestic relations order. An "eligible retirement plan" also is a Roth IRA described in Section 408A(b) of the Code, provided that any distribution to such Roth IRA is made in accordance with the provisions of Section 408A of the Code. (3) Eligible rollover distribution. An "eligible rollover distribution" is any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: (i) any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary, or for a specified period of ten (10) years or more; (ii) any distribution to the extent such distribution is required under Section 401(a)(9) of the Code; (iii) the portion of any distribution that is not includible in gross income; and (iv) any other distribution that is reasonably expected to total less than two hundred dollars ($200.00) during a year. A portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax member contributions which are not includible in gross income. However, such portion may be transferred only to (1) an individual retirement account or annuity described in Section 408(a) or (b) of the Code, (2) to a qualified defined contribution plan described in Section 401(a) of 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible, or (3) for taxable years beginning after December 31, 2006, to a qualified trust or to an annuity contract described in Section 403(b), if such trust or contract provides for separate accounting for amounts so transferred (including interest thereon), including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible. Sec. 22-43(h). Assignments prohibited. Except as set forth in section 22-43.1, none of the money, pensions or other benefits payable by the system shall be assignable either in law or in equity or be subject to execution, levy, attachment, garnishment or other legal process. (Ord. No. 10657, § 2, 4-28-09, eff. 7-1-09; Ord. No. 11020, § 4, 9-11-12, eff. 7-1-09)

Tucson Code § 22-43.1 System approved domestic relations orders.

Sec. 22-43.1. System approved domestic relations orders. Sec. 22-43.1.(a). Benefits subject to domestic relations orders. The right of a member to a retirement benefit, to the refund of a member's accumulated contributions account, or any other benefit under the provisions of the system shall be subject to award pursuant to a system approved domestic relations order. Sec. 22-43.1(b). System administrator review and approval. The system administrator is responsible for the review and approval of any domestic relations order impacting benefits or rights of a member under this system and which is presented to the system administrator in a timely fashion. The system administrator shall determine whether the domestic relations order can be administered and benefits paid in accordance with the applicable requirements of the order, the system and the Code. Any domestic relations order accepted by the system administrator shall be referred to as a system approved domestic relations order. To the extent permitted by law, the system administrator's decision regarding a domestic relations order shall be final and binding. The city, the board, and the system administrator shall not be responsible for the payment of any system benefits in contravention of a domestic relations order when the domestic relations order is not timely presented to the system administrator for review. Additionally, upon ratification of a member's retirement application by the board, all benefit payment elections (including those filed by the member, ordered pursuant to a system approved domestic relations order or filed by an alternate payee) shall become irrevocable and no change in benefit options shall be permitted, regardless of any changes in the marital status of the member or the alternate payee. Sec. 22-43.1(c). System approved domestic relations order. No domestic relations order shall be accepted by the system administrator if the order requires the system to provide any type, form or time of payment that is not provided under this Code, as determined by the system administrator in its discretion. Additionally, any system approved domestic relations order must reasonably identify the Tucson Supplemental Retirement System and specify all of the following: (1) the name and last known mailing address of the member; (2) the name and last known mailing address of each alternate payee covered by the order; (3) the method of determining the amount of the member's system benefits to be paid to each alternate payee covered by the order; (4) the number of payments or period to which the order applies; and (5) whether survivor benefits are payable to the alternate payee upon the death of the member. (Ord. No. 10657, § 3, 4-28-09, eff. 7-1-09; Ord. No. 11327, § 15, 12-8-15, eff. 1-1-16)

Source: City of Tucson, Tucson Code (Charter and General Ordinances) and Unified Development Code (American Legal Publishing, codelibrary.amlegal.com)URL: https://codelibrary.amlegal.com/codes/tucson/latest/tucson_az/0-0-0-17060Fetched: 10/28/2026