Retirement of Employees of Schools and Educational Institutions

Ark. Code Ann. tit. 24, ch. 7

in effect

Ark. Code Ann. § 24-7-101 Special allowances to encourage early retirement.

(a) e The presidents and chancellors of the various publicly supported colleges and universities may, upon the approval of their respective boards of trustees, negotiate with faculty and staff members of their institutions so that, in order to secure early retirement, special allowances may be paid to the faculty and staff members or into retirement plans for their benefit. (b) The board of trustees of each institution is authorized to pay such allowances as the board may approve from any appropriation provided for regular salaries for the benefit of its institution and from any source of funds available to its institution. (c) The board of trustees of each institution shall report the exact disposition of the special allowances to the Legislative Joint Auditing Committee each year.

Ark. Code Ann. § 24-7-102 Management of early retirement window incentives.

(a) The purpose of this section is to create incentives for the efficient management of the public higher education resources of the State of Arkansas by allowing public higher education institutions to establish early retirement window incentives for qualified faculty and staff who elect voluntary separation from the institution. (b) The boards of trustees of the publicly supported institutions of higher education may provide special allowances for faculty and staff to effect a saving in personnel salaries and fringe benefits costs when it is determined by the boards that such saving will provide for more efficient operation of the institutions. (c)(1) The boards of trustees shall approve criteria to determine qualifications to be met by the institutions and the employee. (2) Such qualifications shall include, but are not limited to: (A) Assurance that participation is strictly voluntary for employees; (B) Only full-time employees who meet the retirement requirements for any state-sponsored retirement program; and (C) A savings in personnel cost will be realized by the institution. (d) The boards of trustees are authorized to pay such allowances from any appropriation provided for regular salaries for the benefit of their institutions and from any sources of funds available to the institutions. (e) The board of trustees of each institution shall report the exact disposition of the special allowance to the Legislative Joint Auditing Committee by July 1 of each year.

Ark. Code Ann. § 24-7-103 Payment of employer contribution rate.

Local school districts shall pay the teacher retirement employer contribution rate for any eligible employee in accordance with rules established by the Board of Trustees of the Arkansas Teacher Retirement System.

Ark. Code Ann. § 24-7-104 Employer early retirement incentives.

An employer's offer to encourage an employee to terminate his or her employment with the employer shall not include a requirement that the employee file an application for retirement with the Arkansas Teacher Retirement System.

Ark. Code Ann. § 24-7-105 Socially responsible investments.

A decision on whether to invest, not invest, or withdraw from investment the funds of the Arkansas Teacher Retirement System or an alternate retirement plan of the system shall not be based on a consideration that the location of the investment, fund, company, or any other type of investment vehicle is in the State of Israel.

Ark. Code Ann. § 24-7-201 Title.

This act, which establishes the Arkansas Teacher Retirement System, may be cited as the “Arkansas Teacher Retirement System Act”.

Ark. Code Ann. § 24-7-203 Penalty.

Any person who knowingly makes any false statement or who falsifies or permits to be falsified any record or records in an attempt to defraud the Arkansas Teacher Retirement System shall be guilty of a Class A misdemeanor and upon conviction shall be punished as provided by law.

Ark. Code Ann. § 24-7-204 Tax status of system assets.

The assets of the Arkansas Teacher Retirement System are exempt from taxes by the state, any political subdivision, or an agency thereof.

Ark. Code Ann. § 24-7-205 Correction of errors.

(a)(1) If a change, omission, or error in the records of the Arkansas Teacher Retirement System results in a benefit participant, employer, or the system having received an overpayment or underpayment of any obligation, liability, contribution, or other right to payment more or less than what would have been paid or received if the records had been correct, the system or its designee shall correct the record and, as far as practicable, shall adjust the obligation, liability, contribution, or other right to payment. (2) A refund payable to a benefit participant shall be paid based on the corrected record. (3) The system may withhold an amount owed to the system from a benefit participant to correct an overpayment made to the benefit participant. (b)(1) If a benefit participant has a balance due to the system or receives any benefit or other distribution by the system to which the benefit participant is not entitled or the benefit participant or employer has an unpaid obligation to the system, the system or its designee, under rules adopted by the Board of Trustees of the Arkansas Teacher Retirement System, may: (A) Withhold the amount due from any benefit or payment due the benefit participant; (B) Collect the amount in any other manner provided by law; or (C)(i) Convert contributory service credit to noncontributory service credit for the fiscal year for which there is a member contribution balance due to the system, if the member that owes the member contribution balance elects to have the system convert the contributory service credit rather than pay the balance due. (ii) If contributory service credit is converted to noncontributory service credit under subdivision (b)(1)(C)(i) of this section, the system shall return any member contributions for the affected portion of that fiscal year without interest. (2) Withheld amounts shall be used to effect repayment until the total amount withheld equals all amounts payable by the benefit participant to the system. (3)(A) Before making an adjustment of benefits or pursuing any other collection action under this section, the system or its designee shall provide notice to the benefit participant or employer. (B) The notice shall describe the process for disputing an adjustment of benefits. (4) The board or its designee may waive adjustment or repayment due to the system, including interest, if: (A) The error was not the result of the benefit participant's or employer's intentional nondisclosure, fraud, misrepresentation, or other fault; and (B) The board or its designee finds in his or her or its sole discretion that recovery of the amount owed to the system will result in a manifest injustice. (c) A determination, review, administrative action, cause of action, request to enforce, change, or modify an obligation, duty, benefit calculation, designation, refund, contribution, service credit, or other right arising under this subchapter shall not be valid unless commenced within the look-back period unless the system determines that the justification to commence the process is due to intentional nondisclosure, fraud, misrepresentation, criminal act, or an obvious or documented error by an employer or the system that understated the service credit or salary of a member . (d) The board or its designee may make adjustments to the employer, member, and system records beyond the look-back period if the board determines that the time limitation imposed by the look-back period will result in a manifest injustice in a specific case. (e) The board or its designee may waive or modify the impact of a rule, provision, or law that does not violate federal law or jeopardize the tax-qualified status of the system to correct or prevent a manifest injustice that would affect the system, benefit participant, or employer in a particular instance.

Ark. Code Ann. § 24-7-207 Increase in benefit amount.

(a)(1) The Board of Trustees of the Arkansas Teacher Retirement System is authorized to raise the level of benefits provided to the current retirees and other beneficiaries of the Arkansas Teacher Retirement System . (2) The board may raise the level of benefits to a comparable level increase that matches the increase in benefits that would accrue to active members as a result of any reduction caused by setting the applicable number of years used in computing final average salary for retirement benefits at not less than three (3) years and not more than five (5) years in accordance with any rules that the board may promulgate. (b) The amount of any increase for retirees and other beneficiaries shall also be determined in accordance with the rules of the board as is actuarially appropriate for the system.

Ark. Code Ann. § 24-7-208 Benefit enhancements — Restrictions.

(a) No benefit enhancement provided for by this chapter shall be implemented if it would cause the Arkansas Teacher Retirement System's unfunded actuarial accrued liabilities to exceed an eighteen-year amortization. (b) No benefit enhancement provided for by this chapter shall be implemented by the system if the system has unfunded actuarial accrued liabilities being amortized over a period exceeding eighteen (18) years until the unfunded actuarial accrued liability is reduced to a level less than the standards prescribed by § 24-1-101 et seq.

Ark. Code Ann. § 24-7-209 Suspension of benefit payments upon request.

(a) Subject to the minimum distribution provisions of § 24-7-730, a person entitled to receive an annuity may submit a request to the system in writing, for personal reasons and without disclosure thereof, to suspend the payment of all the benefit otherwise payable to him or her by the system. (b) Upon receipt of the request, the system shall authorize the suspension, and the person shall be deemed to have forfeited all rights to the benefit so suspended but shall have the right to have the full benefit otherwise payable reinstated as to future monthly payment upon written notice to the system to revoke the prior request for suspension under this section.

Ark. Code Ann. § 24-7-210 Federal taxation.

(a) The Executive Director of the Arkansas Teacher Retirement System is authorized and directed to operate the Arkansas Teacher Retirement System and interpret any provisions of § 24-7-101 et seq. consistent with the requirements under the Internal Revenue Code and applicable United States Department of the Treasury regulations necessary to permit the system to be operated as a “qualified trust” under Internal Revenue Code, 26 U.S.C. § 401(a). (b) Notwithstanding any language to the contrary set forth in this chapter, the Board of Trustees of the Arkansas Teacher Retirement System shall have the authority to promulgate rules consistent with these directions. (c) Any rule promulgated under this section that is found to be in conflict with an applicable provision of the code is null and void.

Ark. Code Ann. § 24-7-211 Appeals.

A benefit participant or employer may appeal a final administrative decision of the Board of Trustees of the Arkansas Teacher Retirement System by filing a complaint in the Pulaski County Circuit Court.

Ark. Code Ann. § 24-7-212 Creating an Investment Opportunity for Early Childhood Workers Act of 2025 — Definition.

(a) This section shall be known and may be cited as the "Creating an Investment Opportunity for Early Childhood Workers Act of 2025." (b) As used in this section, "early childhood worker" means a person who is: (1) Providing teaching, early childcare education, or supervision for a child enrolled in a licensed childcare facility under the Childcare Facility Licensing Act, § 20-78-201 et seq.; (2) Employed by a childcare provider that is licensed and regulated by the Department of Education as an appropriate early childhood program as defined under § 6-45-103; and (3) Employed by a childcare provider that receives state or federal child care funding from the Department of Education under § 6-87-101. (c)(1) A single nonprofit fiscal agent that is approved by the Board of Trustees of the Arkansas Teacher Retirement System may act as a pass- through fiscal agent to facilitate the voluntary participation of an early childhood worker in the Arkansas Teacher Retirement System. (2) The board shall authorize participation consistent with § 24-7-202(21)(F)(i) and § 24-7-202(21)(F)(ii). (3) Membership in the system is not mandatory for an employee of a facility regardless of whether the board authorizes participation under subdivision (c)(2) of this section. (d) An early childhood worker shall not be entitled to: (1) Contribution from state funds; or (2) Matching from the state or the system. (e) The board shall promulgate rules for the implementation of this section.

Ark. Code Ann. § 24-7-301 Board of trustees — Members.

The general administration and responsibility for the proper operation of the Arkansas Teacher Retirement System and for making effective the provisions of this act are vested in a board of trustees of fifteen (15) persons as follows: (1) The Bank Commissioner, the Treasurer of State, the Auditor of State, and the Commissioner of Elementary and Secondary Education shall be ex officio trustees; (2)(A) Seven (7) members shall be elected active member trustees, each of whom shall have at least five (5) years of actual service in force and be an active member. For the purpose of this section and § 24-7-302, participants in the Teacher Deferred Retirement Option Plan shall be considered active members. (B) Four (4) active member trustees shall be employed in a position that requires state licensure, but not an administrator's license. One (1) member trustee will be elected from each of the four (4) congressional districts. The four (4) member trustees shall be elected by the members employed in positions that require state licensure, but not an administrator's license. (C)(i) Two (2) active member trustees shall be employed in a position requiring an administrator's license, one (1) of whom shall be a superintendent or an educational cooperative director. (ii) These two (2) active member trustees shall be elected by members employed in positions requiring an administrator's license. (D) One (1) active member trustee shall be employed in a position not requiring state licensure. This member trustee shall be elected by members employed in positions not requiring state licensure; (3) One (1) trustee shall be a person who: (A) Is an active or retired member of the system; (B) Is elected from the active and retired membership of the system; and (C) Has at least five (5) years of actual service; (4)(A) Three (3) retirees shall be elected retiree trustees by the retirees of the system. (B) Each retiree trustee shall be a retiree with an annuity being paid by the system at the beginning of his or her term of office; (5) The member and retiree trustees shall be elected in accordance with rules as have been adopted by the board to govern the elections; and (6) An employee working for the system is not eligible to be: (A) Elected or appointed to the board; or (B) A candidate to be elected or appointed to the board.

Ark. Code Ann. § 24-7-302 Term of office and vacancies.

(a)(1) The term of office of each member-elected trustee shall be six (6) years. (2)(A)(i) An active member trustee shall be ineligible to serve after becoming inactive, retiring, or ceasing to be employed by an Arkansas Teacher Retirement System employer. (ii) A member trustee who participates in the Teacher Deferred Retirement Option Plan is considered active for purposes of this subsection. (B) A retiree trustee is ineligible to serve after becoming active. (b)(1)(A) If any member trustee fails to attend three (3) consecutive regular meetings of the Board of Trustees of the Arkansas Teacher Retirement System, unless in each case excused for cause by the remaining trustees attending the meetings, the member trustee shall be considered to have resigned from the board, and the board shall by resolution declare his or her office of trustee vacated. (B) A regular meeting of the board shall include one (1) or more days of official business to be considered by the board. (2) If a vacancy occurs in the office of an elected trustee, the board by majority vote may fill the vacancy by: (A) A special election; or (B) Appointment of a trustee until the next system election. (c) The board shall adopt its own rules pertaining to attendance and vacancies as provided in subsection (b) of this section.

Ark. Code Ann. § 24-7-303 Board of trustees — Officers — Committees.

(a) The Board of Trustees of the Arkansas Teacher Retirement System shall select from its own number a chair and a vice chair. (b)(1) The trustees shall serve as trustees without compensation for their services as such, except that: (A) Each trustee may receive expense reimbursement in accordance with § 25-16-901 et seq.; and (B) The Arkansas Teacher Retirement System shall reimburse a trustee for reasonable expenses incurred in the performance of his or her duties as trustee, including without limitation, the cost of: (i) A substitute teacher for a trustee; and (ii) Communication services required for paperless board meetings. (2) Trustees are authorized to attend all system committee meetings, board meetings, and other official system functions without negative impact on his or her employment status. (c) The board shall appoint the Executive Director of the Arkansas Teacher Retirement System, and he or she shall serve as its chief executive officer. He or she shall perform, or cause to be performed, such duties as are required of him or her under this act and as the board shall delegate to him or her. (d) The board shall appoint an actuary or a firm of actuaries to be technical advisor to the board on matters regarding the operation of the system on an actuarial basis. The actuary shall perform such duties as are required of him or her under this act and as are required of him or her by the board from time to time. (e)(1) The board shall appoint a professional investment counsel to be investment advisor to the board. (2)(A) No investment shall be made by the board until it has received the advice of its investment advisor. (B) However, if the contemplated investment involves anything other than financial assets, as defined in § 4-8-102(a)(9), then in lieu of seeking advice from its investment advisor, the board shall seek and receive advice from a person having recognized expertise with respect to the type of investment contemplated. (f) The board shall appoint a medical committee consisting of three (3) physicians to review applications for disability retirement. (g) The executive director may employ such other professional and clerical services and purchase such equipment and supplies as are required for the proper operation of the system, subject to the approval of the board. (h)(1) The compensation of the persons engaged by the board shall be consistent with the pay plan of the state. (2)(A) All other expenses of the board necessary for the operation of the system shall be paid at such rates and in such amounts as the board shall approve. (B) The board may create additional committees as necessary and appropriate to fulfill the duties and responsibilities of the board under this chapter. (i)(1) An audit committee created by the board shall perform an annual employee evaluation of an internal auditor of the system. (2) The audit committee may: (A) Meet in executive session, with or without the internal auditor, for the purpose of conducting, reviewing, and discussing the employee evaluation of the internal auditor; and (B) Gather information necessary to conduct a fair review of the internal auditor.

Ark. Code Ann. § 24-7-304 Meetings.

(a) The Board of Trustees of the Arkansas Teacher Retirement System shall hold regular meetings at least quarterly. (b) Eight (8) trustees constitute a quorum at any meeting of the board. (c) Each trustee shall be entitled to one (1) vote on each question before the board, and at least eight (8) concurring votes shall be required for a decision by the board at any meeting. (d) The board shall adopt its own rules of procedure and shall keep a record of its proceedings. (e) All meetings of the board shall be public.

Ark. Code Ann. § 24-7-305 Board of trustees — Duties and responsibilities.

(a)(1) Both the contributory plan provided by this act and the noncontributory plan established by §§ 24-7-401 — 24-7-411 and 24-7-701, 24-7-702, 24-7-704 — 24-7-713, 24-7-715, and 24-7-716 [repealed] shall be under the administration and control of the Board of Trustees of the Arkansas Teacher Retirement System as provided by § 24-7-301. (2) It is the intent of the General Assembly that neither the composition, responsibilities, nor the authority of the board be changed as a result of §§ 24-7-401 — 24-7-411 and 24-7-701, 24-7-702, 24-7-704 — 24-7-713, 24-7-715, and 24-7-716 [repealed]. (b)(1) The board shall promulgate rules as it deems necessary from time to time in the transaction of its business and in administering the Arkansas Teacher Retirement System. (2) In order to fully comply with federal requirements that may affect the members or the members' benefits under this subchapter, and to limit the impact of changes in federal requirements on members or the members' benefits, the board may promulgate rules to: (A) Establish the regular retirement age for members consistent with the provisions of the Internal Revenue Code, 26 U.S.C. § 411; (B) Maintain the system's retirement plan tax qualification status by the United States Government to remain tax-exempt and tax-qualified under the Internal Revenue Code, 26 U.S.C. § 401(a); and (C) Modify or eliminate a plan provision that was originally established to comply with Internal Revenue Code requirements but is no longer necessary to maintain the plan's tax-qualified status under the Internal Revenue Code, 26 U.S.C. § 1 et seq., including without limitation provisions concerning: (i) Penalties; (ii) Restrictions; (iii) Time limitations; and (iv) Other requirements that impact a member, members' benefits, or the plan. (3) The board may adopt rules, procedures, plans, programs, and actions necessary to enable the system to pay all benefits earned by the system's members and reduce penalties or restrictions required by the Internal Revenue Service while maintaining compliance with the Internal Revenue Service. (4) The board may adopt or amend by motion or resolution at any board meeting investment policies, investment procedures, and investment asset allocation targets that are consistent with the board's fiduciary obligations under the prudent investor rule and other obligations under this subchapter. (5) The board may set or amend by a motion or resolution at any board meeting a de minimis amount concerning the system's obligation to distribute or collect payments, penalties, interest, funds, or moneys. (6) The rulemaking authority specifically granted under this chapter shall not limit the general rulemaking authority of the board under subdivision (b)(1) of this section. (c) The board shall adopt from time to time such reasonable mortality and other tables of experience and a rate or rates of regular interest as shall be necessary for the actuarial requirements of the Arkansas Teacher Retirement System. (d) The Executive Director of the Arkansas Teacher Retirement System shall keep, or cause to be kept, in convenient form such data as shall be necessary for actuarial investigations of the experiences of the system, and such data as shall be necessary for annual actuarial valuations of the system. (e)(1) The board shall annually render a report to each employer showing the financial condition of the system as of the preceding June 30. (2) The report shall contain, but shall not be limited to: (A) A financial balance sheet; (B) A statement of income and disbursements; (C) A detailed statement of investments acquired and disposed of during the year, together with a detailed statement of the annual rates of investment income from all assets and from each type of investment; (D) An actuarial balance sheet prepared by means of the last valuation of the system; and (E) Such other data as the board shall deem necessary to comply with § 24-2-702. (3) In addition to the distribution of the report provided by this subsection, it shall also be distributed to the Legislative Council and to the Governor. (f) All records of the system shall be kept and maintained in the office of the system. (g)(1) The board shall arrange for adequate surety bonds covering the executive director and any other custodian of the funds or investments of the board. (2) When approved by the board, the bonds shall be deposited in the office of the Treasurer of State. (h) The records and accounts of the system shall be audited by Arkansas Legislative Audit. (i) The headquarters of the system shall be in Little Rock.

Ark. Code Ann. § 24-7-402 Assets as trust fund — Custodian.

(a) All assets of the Arkansas Teacher Retirement System shall constitute a single trust fund, and the Board of Trustees of the Arkansas Teacher Retirement System shall be the trustees of the fund. (b)(1) The custodian of system assets shall be the Treasurer of State or other financial institutions or depositories as allowed under this subchapter. (2) When acting as custodian of system assets, the Treasurer of State shall act in accordance with the instructions of the board.

Ark. Code Ann. § 24-7-403 Restrictions on use of assets.

(a) All assets of the Arkansas Teacher Retirement System shall be held for the sole purpose of paying benefits and making disbursements in accordance with the provisions of this act and shall be used for no other purpose whatsoever, unless the assets are used to purchase or construct a building to be used for the permanent offices of the system upon approval of the Board of Trustees of the Arkansas Teacher Retirement System. (b)(1) Except as to the rights of a member, retiree, or beneficiary, a trustee, officer, or employee of the board shall not have any direct or indirect interest in the gains or profits of any investment made by the board. (2) A trustee, officer, or employee of the board shall not directly or indirectly use the assets of the system in any manner for himself or herself or as an agent. (3) A trustee, officer, or employee of the board shall not in any manner become an endorser, surety, or obligor for moneys loaned by or borrowed from the board. (4) A trustee, officer, or employee of the board may make such current and necessary payments as are authorized by the board.

Ark. Code Ann. § 24-7-404 Default where issuer receives money from State of Arkansas.

In the event of default in payment of the principal or interest of any investment obligation held by the Arkansas Teacher Retirement System where the issuer of the obligation receives moneys from the State of Arkansas, the default shall be certified by the Board of Trustees of the Arkansas Teacher Retirement System to the Treasurer of State, who shall withhold all moneys due the issuer from the State of Arkansas until the default, together with interest thereon, is satisfied.

Ark. Code Ann. § 24-7-405 Retirement fund assets accounts generally.

The assets of the Arkansas Teacher Retirement System shall be recorded in accounts established by the Board of Trustees of the Arkansas Teacher Retirement System, as necessary, to manage the system's fund assets.

Ark. Code Ann. § 24-7-407 Retirement fund assets accounts — Employer accumulation account.

(a) The employer accumulation account is the account in which shall be accumulated the employer's contributions to the Arkansas Teacher Retirement System, and from which shall be made transfers as provided in this act. (b) Upon the retirement of a member, the difference between his or her annuity reserve and his or her accumulated contributions standing to his or her credit in the members' deposit account at that time shall be transferred from the employer accumulation account to the retirement reserve account. (c) Upon the death of a member, if survivor benefits become payable on account of his or her death, the difference between the reserve for the survivor benefits payable and the member's accumulated contributions standing to his or her credit in the members' deposit account at the time of his or her death shall be transferred from the employer accumulation account to the survivor benefit account.

Ark. Code Ann. § 24-7-408 Retirement fund assets accounts — Retirement reserve account.

(a) The retirement reserve account shall be the account from which shall be paid all annuities and benefits in lieu of annuities payable as provided in this act to retirees who retired on account of superannuation or disability and to beneficiaries of such retirees. (b) If a disability retiree returns to teaching service: (1) The amount of his or her accumulated contributions at the time of his or her disability retirement shall be transferred from the retirement reserve account to the members' deposit account; and (2) The remainder of his or her annuity reserve at the time of return shall be transferred from the retirement reserve account to the employer accumulation account.

Ark. Code Ann. § 24-7-409 Retirement fund assets accounts — Survivor benefit account.

The survivor benefit account shall be the account from which shall be paid survivor benefits payable as provided in this act.

Ark. Code Ann. § 24-7-410 Retirement fund assets accounts — Income-expense account.

(a) The income-expense account shall be the account to which shall be credited all investment income from invested assets of the Arkansas Teacher Retirement System. It shall also be the account in which shall be accumulated the contributions made by employers for the administrative expenses of the system and from which shall be made annual transfers of interest credits to the other accounts of the system and from which shall be paid all the expenses of the Board of Trustees of the Arkansas Teacher Retirement System necessary for the administration and operation of the system. (b) The board may accept gifts and bequests, which shall be credited to the income-expense account along with all other moneys received by the system the disposition of which is not specifically provided for in this act. (c) Each year, the General Assembly shall appropriate the amounts of money certified by the board as required to pay the proper administrative expenses of the system. (d) [Repealed.] (e) Whenever the board determines that the balance in the income-expense account is more than sufficient to cover the current charges to the account, the board may, by resolution, provide for contingency reserves, or for the transfer of the excess, or portions thereof, to cover the needs of the other accounts of the system.

Ark. Code Ann. § 24-7-501 Membership generally.

(a) The membership of the Arkansas Teacher Retirement System shall include the following persons: (1) All teachers who last began service on or after July 1, 1971, and whose service is not covered by another retirement plan similar in purpose to the Arkansas Teacher Retirement System, except Social Security; and (2)(A) All nonteachers who begin nonteaching service on or after July 1, 1989, and whose nonteaching service is not covered by another retirement plan similar in purpose to the Arkansas Teacher Retirement System, except Social Security. (B)(i) All nonteachers who began nonteaching service before July 1, 1989, whose nonteaching service is covered or coverable by the Arkansas Public Employees' Retirement System shall continue to be covered by the Arkansas Public Employees' Retirement System for all nonteaching service, both past and future, unless the nonteacher elects to have the nonteaching service after July 1, 2001, covered by the Arkansas Teacher Retirement System under subdivision (a)(2)(C) of this section. (ii) These nonteachers who began service before July 1, 1989, shall be considered members of a closed system to be administered by the Arkansas Public Employees' Retirement System. (iii) The employer contribution rate for this closed system shall be established at a rate necessary to fund all present and future liabilities until such time as there are no longer members, retirees, or deferred annuitants. (C)(i) Beginning July 1, 2001, and each July 1 of each year thereafter, nonteachers who participate in the Arkansas Public Employees' Retirement System may elect to become members of the Arkansas Teacher Retirement System. (ii) Service credit while a member of the Arkansas Public Employees' Retirement System cannot be established in the Arkansas Teacher Retirement System. (iii) The election to withdraw from the Arkansas Public Employees' Retirement System and become a member of the Arkansas Teacher Retirement System shall be made by May 31, 2001, or by May 31 of each year thereafter, and notice of the election shall be made in writing and filed with the Arkansas Teacher Retirement System. (iv) The election to participate in the Arkansas Teacher Retirement System shall be irrevocable. (3)(A) School resource officers who are qualified under this subdivision (a)(3) and elect to participate in the system on or after July 1, 2013. (B) To participate in the system: (i) A school resource officer paid indirectly by a system employer shall be: (a) A retiree of a reciprocal system; (b) An Arkansas-certified law enforcement officer; and (c) Employed primarily to provide services at a system employer; and (ii) A school resource officer paid indirectly by a system employer shall not: (a) Have participated in the Arkansas Police Officers' Deferred Retirement Option Plan; and (b) Be eligible to participate as an active member of the public retirement system that covers the direct employer of the school resource officer. (C) A school resource officer shall not receive retirement credit for the same service or salary in another public retirement system in Arkansas. (D)(i) A system employer may authorize a school resource officer who is indirectly paid by the system employer to participate as a member of the system by adopting a resolution. (ii) A resolution adopted by the system employer shall: (a) Authorize a school resource officer employed by the system employer to participate as a member of the system; and (b) State the employer's agreement to act as the system employer for the purpose of reporting service, paying contributions to the system on behalf of a school resource officer, and performing all member services as if the school resource officer were directly employed by the system employer. (iii) A school resource officer paid indirectly by a system employer is not eligible to participate as a system member unless the system employer explicitly authorizes such participation by resolution. (E)(i) The salary and service used to determine contributions and benefits in the system shall be based on the salary paid to the school resource officer for performing the services of a school resource officer for the system employer. (ii) If an employer reimburses another public entity for the payment of the school resource officer's salary and salary-related costs, the employer receiving the employment services of the school resource officer shall be the system employer for the purpose of system participation and not the direct public employer. (iii) If a system employer pays all or part of a school resource officer's salary indirectly by reimbursing a law enforcement agency in Arkansas, the system shall treat all salary indirectly paid by the system employer to the school resource officer as if it had been paid by the system employer directly. (F) If a school resource officer becomes a member of the system and his or her salary is paid indirectly by a system employer, then the only employer contribution due on the salary shall be the employer contribution payable to the system. (G) Service as a school resource officer rendered before July 1, 2013, shall not be purchased. (b)(1) A person who has excluded himself or herself from membership before July 1, 1991, may rescind the exclusion by filing with the system a membership data form. (2) The rescission shall be effective July 1 of the fiscal year in which it is exercised. (3) At the direction of the person, the membership may be prospective only, or both prospective and retroactive. (4)(A) Before July 1, 2011, for the membership to be retroactive, the member shall pay to the system both the member contributions and the employer contributions that would have been paid to the system if there had been no exclusion, plus interest from the effective date of the excluded service to the date of payment in full. (B) On or after July 1, 2011, excluded service may be established by paying the actuarial equivalent of the member's benefits to the system. (c) In any case of question as to the system membership status of any person, the Board of Trustees of the Arkansas Teacher Retirement System shall have the final power to decide the question. (d)(1) Membership in the system shall be a condition of employment under subsections (a) and (b) of this section. (2) However, except as provided in this section, individual members who are employed for less than one-fourth (¼) of a fiscal year under § 24-7-601 shall not be eligible for any credit or benefit in the system.

Ark. Code Ann. § 24-7-505 Buyout plan for inactive members — Definition.

(a) As used in this section, “buyout plan” means a voluntary program established by the Board of Trustees of the Arkansas Teacher Retirement System to make a one-time lump-sum payment to a member, surviving spouse, or alternate payee in exchange for a member's, surviving spouse's, or alternate payee's cancellation of membership and retirement benefit rights in the Arkansas Teacher Retirement System. (b)(1) The board may adopt rules as necessary to implement this section. (2) A buyout plan established by the board: (A) May be offered periodically and have a limited term of duration for participation, as determined by a resolution adopted by the board at a meeting of the board; (B) Shall specifically identify the formulas by which contributory and noncontributory service or a future retirement benefit will be purchased by the system as a one-time lump-sum payment from the system, paid directly to the member, surviving spouse, or alternate payee or transferred to another administrator in compliance with the Internal Revenue Code; and (C) Applies only to a group of members, group of surviving spouses, or group of alternate payees, who: (i) Are identified by the board as a group eligible to participate in a buyout plan offered by the board; and (ii) Elect to participate in a buyout plan in exchange for future benefit rights in the system. (3) A buyout plan established by the board may be extended, modified, or expanded by board resolution. (c) A member is eligible to participate in a buyout plan if the member is: (1) Eligible for deferred retirement under § 24-7-707; and (2) Inactive for a minimum of one (1) year following the last fiscal year that the member rendered actual service to a covered employer and received at least one-fourth (¼) year of service credit. (d) The board may offer a buyout plan to surviving spouses or alternate payees who: (1) Are eligible for a future retirement benefit from the system; and (2) Have not received a retirement benefit from the system. (e) A member who participates in a buyout plan shall receive a one-time lump-sum payment from the system that cancels interest in any retirement benefit and all future rights in the system effective upon tender of payment by the system. (f) A buyout plan may be used to cancel both a member's contributory and noncontributory credited service in the system. (g) A member who receives a buyout of his or her credited service under this section may repurchase his or her previously credited service as contributory service after becoming an active member of the system as if the service had been private school service.

Ark. Code Ann. § 24-7-506 Outsourcing — Election to participate — Definitions.

(a) As used in this section: (1)(A) “Covered employer” means any public school, public educational agency, or other eligible employer participating in the Arkansas Teacher Retirement System. (B) “Covered employer” does not include a: (i) Nonmandatory employer or a PSHE employer as defined under § 24-7-1602; or (ii) Covered employer that reports through the Arkansas Administrative Statewide Information System; (2)(A) “Embedded employee” means a person who: (i) Provides an outsourced service on the premises of a covered employer; and (ii) Is employed and paid by an outsource contractor. (B) “Embedded employee” does not include a person who is employed by: (i) A covered employer listed under § 24-7-202; or (ii) An employer that offers the Arkansas Teacher Retirement System as an optional retirement plan as of the date of outsourcing; (3) “Outsource” or “outsourcing” means the use of a contractor by a covered employer for the performance of a service common to the normal daily operation on the premises of the covered employer; (4) “Outsource contractor” means a person who is contractually obligated under an outsourcing agreement to provide a covered employer with a service common to the normal daily operation of the covered employer; (5) “Participating employer” means a covered employer that outsources and opts for the embedded employees of all of the covered employer's outsource contractors to become members of the Arkansas Teacher Retirement System; (6)(A) “School nursing” means a nursing service that is required to be offered in a public school under § 6-18-706 or the Standards for Accreditation of Arkansas Public Schools and School Districts. (B) “School nursing” does not include nursing services provided by a: (i) School-based health clinic under § 6-18-703; (ii) Medical clinic operated on a public school campus by a hospital or physician's office that is under contract with the public school; (iii) Healthcare provider other than a nurse; or (iv) Healthcare service reimbursed or paid for by Medicaid, Medicare, health insurance, or any other third-party payer; (7) “Service common to the normal daily operation” means and is limited to a service that: (A) Is provided by an outsource contractor or embedded employee to a covered employer; (B) Is physically provided or based on the premises of a covered employer; (C) Is paid for with public funds and not with private grant funds; and (D) Consists of one (1) or more of the following: (i) The maintenance and operation of: (a) One (1) or more vehicles used for the regular and daily transport of passengers; and (b) A facility that provides support for the maintenance and operation of one (1) or more vehicles described under subdivision (a)(7)(D)(i)(a) of this section; (ii) The maintenance and operation of a cafeteria or other food service operation; (iii) Custodial or maintenance services for the regular and continuous maintenance, repair, and upkeep of grounds or facilities; (iv) Security services that are not covered by another retirement system; (v) School nursing; (vi) Substitute teaching; or (vii) Service as a teacher's aide; and (8) “Surcharge employer” means a covered employer that outsources and pays a surcharge to the Arkansas Teacher Retirement System . (b) A covered employer that enters into an agreement to outsource a service common to the normal daily operation shall become a surcharge employer within sixty (60) days of the outsourcing agreement . (c)(1) A surcharge employer shall account for and remit to the Arkansas Teacher Retirement System a surcharge of no more than four percent (4%) on the total salaries paid to all the embedded employees on an aggregate basis . (2) The Board of Trustees of the Arkansas Teacher Retirement System may establish by resolution the surcharge rate for any fiscal year following the 2022 fiscal year. (3) A surcharge adopted by the board applies to an entire fiscal year and shall be adopted before the beginning of the fiscal year. (d)(1) The Arkansas Teacher Retirement System may require a surcharge employer to provide any documentation necessary to collect and account for the surcharge as is consistent with the covered employer's election. (2) The Arkansas Teacher Retirement System shall collect an unremitted surcharge amount due, including interest, from a surcharge employer under § 24-7-401 or contribution due from a participating employer under § 24-7-406 in any manner allowed by law. (3) If a surcharge employer reasonably accepts a written statement from an outsource contractor reporting the salaries paid by the outsource contractor to embedded employees for services common to the normal daily operation of the surcharge employer, it shall be conclusively presumed that the written statement accurately reflects the salaries subject to surcharge under this section. (e)(1) The Division of Youth Services Education System shall be a participating employer and may designate any or all of its embedded employees as eligible for membership in the Arkansas Teacher Retirement System. (2) An embedded employee of a contractor for the Division of Youth Services Education System who becomes a member of the Arkansas Teacher Retirement System shall remain a member of the Arkansas Teacher Retirement System as long as the member remains an embedded employee of a contractor for the Division of Youth Services Education System. (f) The use of the terms “employee” and “employer” in this section does not: (1) Create or modify an employment relationship between an embedded employee and a covered employer; (2) Create, permit, expand, or modify any liability or obligation by a covered employer to an embedded employee; or (3) Create, permit, expand, or modify any cause of action by an embedded employee against a covered employer under any employment, labor, civil rights, or other law. (g) The board may promulgate rules to implement this section.

Ark. Code Ann. § 24-7-507 Youth participants — Summer work programs.

(a) At the request of the Arkansas Teacher Retirement System, a covered employer shall provide the system with a memorandum of understanding, partnership agreement, or another similar document related to the covered employer's actions as a pass-through fiscal agent for participants described in § 24-7-202(16)(B). (b) A covered employer who acts as a pass-through fiscal agent shall not be required to report participants described in § 24-7-202(16)(B) as "employees" for purposes of the system. (c) The Board of Trustees of the Arkansas Teacher Retirement System shall promulgate rules for the implementation of this section.

Ark. Code Ann. § 24-7-601 Credited service generally.

(a) By rule, the Board of Trustees of the Arkansas Teacher Retirement System shall fix and determine the number of years, and fraction thereof, of service to be credited each member for his or her employment as an employee. (b)(1) A member shall be employed by an employer covered by the Arkansas Teacher Retirement System for a minimum of one hundred sixty (160) days per fiscal year to earn one (1) year of credited service. (2) Fractional years of service may be granted beginning July 1, 1971, as prescribed by the board. (3) A member shall not receive more than one (1) year of service credit for the member's employment with a covered employer and reciprocal system employer in any one (1) fiscal year. (4)(A) Beginning July 1, 2011, a contributory member who accrues less than one-fourth (¼) year of service credit in a fiscal year may accumulate and carry forward days of service until the first fiscal year in which the contributory member accrues the minimum days of service required to credit one-fourth (¼) year of service credit. (B) Upon the contributing member's accruing of a minimum of one-fourth (¼) year of service credit, the: (i) Service credit shall be applied to the latest fiscal year; and (ii) Carry-forward days shall be reset to zero (0). (c)(1) Days of absence from service because of sickness shall be considered as service if the days are paid sick leave. (2)(A) Except as provided under subdivision (c)(2)(B) of this section, paid or unpaid accrued, unused sick leave shall not be credited as service in the Arkansas Teacher Retirement System. (B) If a member dies during active service on or after July 1, 2013, the member's accrued unused sick leave, whether paid or unpaid, shall be credited as service in the fiscal year of the member's death to determine the member's retirement eligibility, final average salary, and eligibility for other system benefits. The member's account shall be credited with: (i) One (1) day of service for each day of accrued unused sick leave; and (ii) One (1) day of service for any remaining partial day of sick leave. (C) If a member dies during active service on or after July 1, 2013, the member's unused catastrophic leave and unused donated leave shall not be credited as service. (d) No credited service may be granted by the board for service rendered before July 1, 1937. (e)(1) The Arkansas Teacher Retirement System is a reciprocal system under §§ 24-2-401 — 24-2-405. (2) In establishing eligibility for a benefit from the Arkansas Teacher Retirement System, the credited service under all reciprocal systems shall be totaled, and the total credited service shall be used in determining eligibility for an Arkansas Teacher Retirement System benefit. (3) In determining the amount of a benefit from the Arkansas Teacher Retirement System, there shall be used only the actual service under the Arkansas Teacher Retirement System and the benefit formula of the Arkansas Teacher Retirement System. (4) The final average salary used shall be that of the Arkansas Teacher Retirement System or any reciprocal system in which the member has at least two (2) years of service credit, whichever furnishes the highest final average salary at the time of retirement. (5) When the Arkansas Teacher Retirement System provides a benefit amount that is not dependent on length of credited service, the benefit amount shall be reduced to the proportion that actual system service bears to total service credited by a reciprocal system. (7)(A) Except as otherwise provided under this subdivision, reciprocal service earned from participation in an alternate retirement plan shall be used only if the member's contributions to the alternate retirement plan have not been withdrawn in full or in part from the alternate retirement plan by the member. (B) The following shall not prevent a member from establishing reciprocal service in an alternate retirement plan: (i) A withdrawal made by the member from the alternate retirement plan after the member attains fifty-nine and one-half (59 1/2) years of age; and (ii) An eligible rollover transaction under the Internal Revenue Code. (C) In order to restore the use of reciprocal service, a member may repay to an alternate retirement plan a withdrawal made from the alternate retirement plan by the member before the member attained fifty-nine and one-half (59 1/2) years of age if allowed by the alternate retirement plan. (D) A salary earned from participation in an alternate retirement plan shall not be used in the final average salary calculated by the system. (E) The board may promulgate rules for the administration of reciprocal service under an alternate retirement plan, including without limitation rules for salaries, withdrawals, and rollover eligibility under this subdivision. (f) In any case of question as to the service credit of any person, the board shall have the final power to decide the question. (g)(1)(A) Beginning July 1, 2013, the Arkansas Teacher Retirement System shall allow a member who earns concurrent service in both the Arkansas Teacher Retirement System and a reciprocal system to receive full service credit in the Arkansas Teacher Retirement System without reduction of service credit due to the concurrent service. (B) Credited service in an alternate retirement plan or the Arkansas Public Employees' Retirement System is not allowed under subdivision (g)(1)(A) of this section. (C) A member’s part-time employment with a PSHE employer or an employer covered by the Arkansas Public Employees’ Retirement System shall not prevent the member from earning service credit under the Arkansas Teacher Retirement System if the member does not earn service credit in an alternate retirement plan or the Arkansas Public Employees’ Retirement System. (2) The Arkansas Teacher Retirement System shall not recognize any concurrent service added to the member's credited service in the Arkansas Teacher Retirement System that credits a member with more than one (1) year of credited service for a fiscal year or combines salary earned in both systems in a fiscal year for the purpose of: (A) Vesting; (B) Retirement eligibility; and (C) Calculating final average salary. (3)(A) A member may elect to waive all or part of the concurrent service credited to the member in the system and retire under a reciprocal system if the member acknowledges that the waiver is a voluntary surrender of the member's concurrent service credit in the system and cancels the member's concurrent service credit in the system. (B) The employer-and-employee accrued contributions attributable to the concurrent service may be refunded to the employer and member.

Ark. Code Ann. § 24-7-603 Out-of-state service — Definition.

(a) As used in this section, “out-of-state service” means service rendered in any state except Arkansas in a position that would have been covered by the Arkansas Teacher Retirement System had the service been actual service covered by the system if rendered in the state. (b) Out-of-state service purchased before July 1, 1987, shall be credited as service under this section in accordance with provisions in force before July 1, 1987. (c) A member shall be eligible to establish out-of-state service to be credited as service under this subchapter under the following conditions: (1)(A) The out-of-state service credit to be granted shall be limited to service for which no benefit could be paid by another system similar in purpose to this system, except Social Security if the member had left on deposit his or her contributions to the other system. (B) The credit under subdivision (c)(1)(A) of this section is limited to fifteen (15) years; (2)(A) The member shall pay to the system for each year of service credit granted the actuarial equivalent of the member's benefits. (B) The payment shall be credited to the member's account in the members' deposit account and shall be in addition to regular member contributions credited to the member's deposit account; (3)(A) The out-of-state service shall not become credited service under this system until the member has established five (5) or more years of actual service. (B) If a member ceases to be an active member before the out-of-state service has been established as system-credited service, the member payments made under this section shall be refundable; (4) The benefit program to be applied to each year of service credit being granted shall be the benefit program in effect at the time of retirement; and (5) Any other rules consistent with this subchapter as the Board of Trustees of the Arkansas Teacher Retirement System may adopt. (d) A member may purchase a fraction of a year of out-of- state service to be credited as service under this subchapter in the same manner as provided for out-of-state service under subsection (c) of this section if the service meets the following requirements: (1) The member has not less than one-fourth (¼) year of out-of- state credited service in the fiscal year; and (2) The fraction of a year of out-of-state service may be credited in keeping with policies of the board under § 24-7-601. (e) A member shall be eligible, upon application, to purchase service rendered outside the state during a period of employment with an education coordinating council to be credited as out-of-state service under the provisions of this section, provided that the conditions of subsection (c) of this section are met. (f) At the member’s request, a member’s payment under this section shall be refunded if the: (1) Member ceases to be an active member before the out-of-state service is established as credited service in the system; or (2) Out-of-state service is not otherwise used to establish the member’s eligibility for retirement under the system.

Ark. Code Ann. § 24-7-604 Overseas service.

(a) As used in this section, “overseas service” means service in an American-type overseas school sponsored and approved by either the United States Department of State or the United States Department of Defense, or service rendered in the Peace Corps or AmeriCorps VISTA, Volunteers in Service to America. (b) A member of the Arkansas Teacher Retirement System may receive membership service credit for service in an overseas school subject to the following conditions: (1) To be eligible for overseas service credit, a member must have a minimum of five (5) years of membership service in a position covered by the system; (2)(A) The overseas service credit to be granted shall be limited to service for which no benefit could be paid by another system similar in purpose to this system, except Social Security. (B) The maximum overseas service credited to any member shall be ten (10) years; (3)(A) To be eligible for a year of overseas service credit, a member must have rendered the minimum days of service required for a fiscal year of service credit under § 24-7-601. (B) Fractions of years of service may be credited in keeping with policies of the Board of Trustees of the Arkansas Teacher Retirement System as provided by § 24-7-601; (4)(A) Overseas service credit may be established by paying to the system the actuarial equivalent of the member's benefits. (B) The employer's cost-of-service credit may be paid either by the employer or by the member. (c) At the member’s request, a member’s payment under this section shall be refundable if the: (1) Member ceases to be an active member before the overseas service is established as credited service in the system; or (2) Overseas service is not otherwise used to establish the member’s eligibility for retirement under the system.

Ark. Code Ann. § 24-7-605 Service in General Assembly.

(a)(1)(A)(i) Any member of the Senate or House of Representatives of the General Assembly who is a member of the Arkansas Teacher Retirement System shall be eligible, upon application, to receive credited service and salary in the system for his or her full contract salary in the event that a cut in pay is required by the school district during his or her attendance at regular or extraordinary sessions of the General Assembly or during his or her attendance at meetings of regular or special committees of the General Assembly during the interim. (ii) These meetings shall include, but not be limited to, the Legislative Council, the Legislative Joint Auditing Committee, the interim committees, and special legislative committees. (B) The member shall receive credited service and salary upon payment by him or her of the necessary member contribution and upon appropriation from the Public School Fund of the necessary employer contribution for the amount of the salary reduction during periods of attending regular or extraordinary sessions of the General Assembly or sessions of legislative committees. (2) The amount of credited salary shall not exceed the contract salary of the member for the school year contract period. (3)(A) Any member of the House of Representatives or the Senate currently serving in the General Assembly or the legislative committees for any year prior to July 6, 1977, not to exceed five (5) years, may make application for and receive credited service and salary in the system for his or her full contract salary as an employee with respect to any reduction therein during attendance at regular or extraordinary sessions of the General Assembly or sessions of legislative committees in which he or she served. (B) This shall be done only if he or she pays to the system the member contribution required by law, and if appropriation is made from the Public School Fund for the necessary employer contribution required by law for that portion of his or her contract salary for any period for which he or she suffered a reduction in pay during legislative service. (b)(1) Any member of the Senate or House of Representatives of the General Assembly who is an employee and is a member of the system shall be eligible, upon application, to receive credited service and salary in the system for his or her full contract salary in the event that either the member or the school district decides it is in the best interest of the school district for the member to take a leave of absence for up to one (1) full calendar year at a time to attend to his or her duties as a General Assembly member. (2) Service and salary shall be credited upon payment by the member of the necessary member contribution and the necessary employer contribution for the amount of the member's contract salary during periods of attending regular or extraordinary sessions of the General Assembly or sessions of legislative committees. (3) The amount of credited salary shall not exceed the member's contract salary for the school year contract period. (c) At the member’s request, member’s payment under this section shall be refunded if the: (1) Member ceases to be an active member before the General Assembly service is established as credited service in the system; or (2) General Assembly service is not otherwise used to establish the member’s eligibility for retirement under the system.

Ark. Code Ann. § 24-7-606 Service for leave of absence to obtain advanced degree.

(a)(1) A public school teacher or administrator who is a member of the Arkansas Teacher Retirement System and takes a leave of absence from a school in order to obtain an advanced degree at an institution of higher learning or to fulfill the requirements of a scholarship or grant shall be eligible, upon application, to receive credited service in the system for the time of actual enrollment in the institution. (2) Evidence of the minimum days of enrollment at an institution of higher education in a fiscal year equivalent to the minimum days of service required for a fiscal year of service credit under § 24-7-601 shall be presented with the application. (b) The service shall be credited in accordance with § 24-7-601. (c) The member shall pay the actuarial equivalent of the member's benefits to the system for each year of service credit being granted. (d) At the member’s request, a member’s payment under this section shall be refunded if the: (1) Member ceases to be an active member before the service for leave of absence to obtain an advanced degree at an institution of higher learning or to fulfill the requirements of a scholarship or grant is established as credited service in the system; or (2) Service for leave of absence to obtain an advanced degree at an institution of higher learning or to fulfill the requirements of a scholarship or grant is not otherwise used to establish the member’s eligibility for retirement under the system.

Ark. Code Ann. § 24-7-607 Private school service — Definition.

(a) As used in this section, “private school service” means service rendered in a private school or agency that would have been covered by the Arkansas Teacher Retirement System if the service had been: (1) Rendered in a public school; and (2) The private school or agency: (A) Has positions that would require the issuance of a teaching license in a public school based upon a determination by the Arkansas Teacher Retirement System; or (B)(i) Is recognized as a private educationally related entity by resolution adopted by the Board of Trustees of the Arkansas Teacher Retirement System. (ii) Private educationally related entity service purchased for employment at a private educationally related entity to obtain system-credited service is limited to five (5) years or less. (b) A member purchasing certified private school service shall be eligible, upon application, to purchase private school service for a period not to exceed fifteen (15) years, to be credited as certified service under this subchapter under the following conditions: (1) The private school service credit to be purchased shall be limited to service for which no benefit could be paid by another system similar in purpose to the Arkansas Teacher Retirement System except Social Security if the member left on deposit his or her contributions to the other system; (2)(A) The member shall pay the actuarial equivalent of benefits as set forth under § 24-7-202 to the Arkansas Teacher Retirement System for each year of private school service credit being purchased. (B) The payment shall be credited to the member's account in the members' deposit account and shall be in addition to regular member contributions credited to the member's deposit account; (3) The private school service shall not become credited service under the Arkansas Teacher Retirement System until: (A) The member payment under this section has been paid in full; and (B)(i) The member has established five (5) or more years of actual service, exclusive of private school service. (ii) At the member's request, a member's payment for certified private school service credit shall be refunded if the: (a) Member ceases to be an active member before the certified private school service is established as credited service in the system; or (b) Certified private school service is not otherwise used to establish the member's eligibility for retirement under the system; (4) The benefit program to be applied to each year of private school service credit and private educationally related entity service credit being purchased shall be the benefit program in effect at the time of retirement; and (5) Any other rules consistent with this subchapter as the Board of Trustees of the Arkansas Teacher Retirement System may from time to time adopt. (c)(1) A member is eligible to purchase noncertified private school service or private education-related entity private school service for a period of five (5) years or less that will be credited as noncertified service under this subchapter when: (A) The member properly submits an application to purchase noncertified private school service or private education-related entity private school service; (B) The noncertified service credit to be purchased is limited to service for which no benefit could be paid by another state- supported pension system or a system with a similar purpose when the contributions of the member were left on deposit with the other system; and (C)(i) The member pays the actuarial equivalent of benefits as set forth under § 24-7-202 to the Arkansas Teacher Retirement System for each year of service credit being purchased. (ii) The payment shall be credited to the member's account in the members' deposit account and shall be in addition to regular member contributions credited to the member's deposit account. (2) The noncertified service shall not become credited service under the Arkansas Teacher Retirement System until: (A) The member payment under this section has been paid in full; and (B)(i) The member has established five (5) or more years of actual service in the Arkansas Teacher Retirement System. (ii) At the member’s request, a member’s payment for noncertified private school service credit or noncertified private education- related entity private school service shall be refundable if the: (a) Member ceases to be an active member before the noncertified private school service or private education-related entity private school service is established as credited service in the system; or (b) Noncertified private school service or private education-related entity private school service is not otherwise used to establish the member’s eligibility for retirement under the system. (3) The benefit program applied to each year of private school service or private education-related entity private school service credit being purchased shall be the benefit program in effect at the time of retirement. (4) The purchase and application of the noncertified service credit shall be subject to the rules consistent with this subchapter that the Arkansas Teacher Retirement System may adopt. (d) A member may purchase a fraction of a year of private school service to be credited as service under this subchapter in the same manner as provided for private school service under subsection (b) of this section if the service meets the following requirements: (1) The member has not less than one-fourth (¼) of a year of private school service in a fiscal year under § 24-7-601; and (2) The fraction of a year of private school service may be credited in keeping with policies as provided by § 24-7-601.

Ark. Code Ann. § 24-7-608 Limitation on benefit enhancement.

(a) A benefit enhancement provided for by this act shall not be implemented if it would cause the publicly supported retirement system's unfunded actuarial accrued liabilities to exceed an eighteen-year amortization. (b) A benefit enhancement provided for by this act shall not be implemented by any publicly supported system which has unfunded actuarial accrued liabilities being amortized over a period exceeding eighteen (18) years until the unfunded actuarial accrued liability is reduced to a level less than the standards prescribed by § 24-1-101 et seq.

Ark. Code Ann. § 24-7-610 Credit for service in National Guard and armed forces reserve — Definition.

(a) As used in this section, “armed forces reserve” means one (1) of the reserve components of the United States Army, United States Navy, United States Air Force, United States Marine Corps, United States Space Force, or United States Coast Guard. (b)(1) A member of the Arkansas Teacher Retirement System shall be entitled to purchase credited service in the system for a period not to exceed five (5) years for service rendered by the member in the National Guard or the armed forces reserve if the member: (A) Makes an application to the Board of Trustees of the Arkansas Teacher Retirement System; (B) Provides proof satisfactory to the board of that person's service in the National Guard or the armed forces reserve; and (C) Pays to the system for each year of service credit being granted the actuarial equivalent of the member's benefits. (2) The payment shall be credited to the member's account in the members' deposit account and shall be in addition to regular member contributions. (c) A member may purchase one (1) year of service credit for each one (1) year of service in the National Guard or armed forces reserve. (d) The National Guard or armed forces reserve service shall not become credited service under this system until: (1) The member payments specified in subdivision (b)(1)(C) of this section have been paid in full; and (2) The member has established five (5) or more years of actual service in the system. (e) Service in the National Guard or armed forces reserve service shall be credited to the year in which it was rendered even if the member has concurrent service with a covered employer. (f) At the member’s request, a member’s payment under this section shall be refunded if the: (1) Member ceases to be an active member before the service in the National Guard or the armed forces reserve is established as credited service in the system; or (2) Service in the National Guard or the armed forces reserve is not otherwise used to establish the member’s eligibility for retirement under the system. (g)(1) This section is supplemental to § 24-7-602, and this section does not diminish the right of a member of the system to obtain credited service in the system for active duty military service within the limits permitted by § 24-7-602. (2) However, a member shall not be entitled to or receive in excess of five (5) years of credited service rendered by the member under this section.

Ark. Code Ann. § 24-7-611 Domestic federal service — Definition.

(a) As used in this section, “domestic federal service” means service rendered as a teacher or administrator in any school or similar institution located on a military base or installation that is administered by the United States Department of Defense. (b) On and after January 1, 2003, a member shall be eligible upon application to purchase domestic federal service to be credited as service under this section under the following conditions: (1) The domestic federal service credit to be granted shall be limited to service for which no benefit could be paid by a retirement system similar in purpose to the Arkansas Teacher Retirement System except Social Security if the member left on deposit his or her contributions to the other system, and it shall be limited to ten (10) years; (2)(A) For each year of domestic federal service credit granted, the member shall pay to the system the employee and employer contributions based on the actuarial equivalent of the member's benefits. (B) The payment is credited to the member's account in the members' deposit account and is in addition to regular member contributions; (3) The domestic federal service shall not become credited service under this system until: (A) The member payment under this section has been paid in full; and (B)(i) The member has established five (5) or more years of actual service exclusive of domestic federal service. (ii) If a member ceases to be an active member before the domestic federal service has been established as system-credited service, the member payments contributed under this section shall be refunded to the member upon request; (4) The benefit program to be applied to each year of service credit being granted shall be the benefit program in effect at the time of retirement; and (5) Any other rules consistent with this section that the Board of Trustees of the Arkansas Teacher Retirement System may adopt. (c) A member may purchase a fraction of a year of domestic federal service to be credited as service under this subchapter in the manner provided for domestic federal service under subsection (b) of this section if the service meets the following requirements: (1) The member has not less than one-fourth (¼) year of domestic federal service in a fiscal year under § 24-7-601; and (2) The fraction of a year of domestic federal service may be credited in keeping with policies as provided by § 24-7-601. (d) However, the board shall not implement this section until the system has reduced its unfunded actuarial accrued liabilities being amortized over a period exceeding thirty (30) years to a level less than the standards prescribed for those public retirement systems under §§ 24-1-104 and 24-1-105. (e) At the member’s request, a member’s payment under this section shall be refunded if the: (1) Member ceases to be an active member before the domestic federal service is established as credited service in the system; or (2) Domestic federal service is not otherwise used to establish the member’s eligibility for retirement under the system.

Ark. Code Ann. § 24-7-612 Service credit purchase.

(a) A member who purchases service credit in the Arkansas Teacher Retirement System shall pay the actuarial equivalent of both the employee and employer contributions, as calculated by the system. (b)(1) If a member has an existing service purchase account with the system before July 1, 2011, the member shall pay the balance of the account to the system according to the payment schedule agreed upon by the member and the system. (2) The member shall agree to a reasonable payment schedule with the system on or before June 30, 2012, or the member payments, if any, shall be returned to the member by the system without interest on the member payments as allowed by law. (3) The service purchase account shall be closed after the system has returned the member payments. (c) Beginning July 1, 2011, service purchase accounts shall not be created for the purchase of service credit in the system. (d) The Board of Trustees of the Arkansas Teacher Retirement System may promulgate rules regarding service purchase accounts consistent with this section. (e) All payments for service credit purchases shall be received by the system before the member's first annuity installment or T-DROP deposit occurs.

Ark. Code Ann. § 24-7-613 Permissive service credit — Gap period service.

(a) A member of the Arkansas Teacher Retirement System may purchase permissive service credit for one (1) or more gap periods if the member: (1) Has five (5) years of actual service in the system; (2) Has left his or her position as a classroom teacher immediately before each nonconsecutive gap period or the initial gap period of consecutive gap periods; (3) Returns to his or her position as a classroom teacher after one (1) or more gap periods; (4) Accrues at least one-half (½) year of service credit after returning to his or her position as a classroom teacher; (5) Was inactive during the gap period or gap periods; and (6) Is ineligible to receive free service credit for each gap period under another provision of the law applicable to the system . (b)(1) A member may purchase one-quarter (1/4) year of permissive service credit for each gap period. (2) A member shall not purchase more than five (5) years of permissive service credit. (c) Permissive service credit for one (1) or more gap periods shall not be purchasable after a member retires from the system. (d) Permissive service credit shall be credited in accordance with § 24-7-601. (e)(1) The member shall pay the actuarial equivalent of the member's benefits to the system for each one-quarter (1/4) year of permissive service credit purchased. (2) Each one-quarter (1/4) year of permissive service credit that is being purchased by a member shall not become credited service under the system until the actuarial equivalent of the member's benefits is paid in full. (f) At the member's request, a member's payment for permissive service credit under this section shall be refunded if the: (1) Member ceases to be an active member before the permissive service credit is established as credited service in the system; or (2) Permissive service credit is not otherwise used to establish the member's eligibility for retirement under the system.

Ark. Code Ann. § 24-7-701 Voluntary retirement.

(a)(1)(A) Except as provided under subdivision (a)(2) of this section, an active member who either attains sixty (60) years of age and has five (5) or more years of actual and reciprocal service or who has twenty-eight (28) or more years of credited service regardless of age may voluntarily retire upon written application filed with the Arkansas Teacher Retirement System. (B) If a member fails to submit a complete retirement application by the end of the sixth full calendar month immediately following the effective date of benefits, including all additional documentation required by the system, the application shall be void unless an extension has been granted by the Executive Director of the Arkansas Teacher Retirement System. (2)(A) A member shall meet the termination of covered employment requirements under § 24-7-502 to be eligible for retirement unless the member has attained normal retirement age. (B) A member who fails to meet the termination of employment requirements of this subsection shall have his or her retirement benefits cancelled and forfeits any retirement benefits until the termination requirements are met. (C)(i) A member who fails to meet the termination requirements of this section and has received retirement benefits from the system shall repay the benefits to the system before becoming eligible again for voluntary retirement. (ii) The system may adjust and collect any benefits that have been overpaid to a member under § 24-7-205. (D) A member who fails to meet the termination requirements of this section upon employment by a covered employer shall return to active member status under § 24-7-502. (b) Upon a member's retirement, he or she or she shall receive a life annuity as provided for in § 24-7-705. (c) The annuity shall begin the first day of the calendar month next following the latest of: (1) One (1) month after the date the written application is filed with the Board of Trustees of the Arkansas Teacher Retirement System; (2) The member's termination of covered employment; (3) The member's attainment of the minimum age; or (4) The member's completion of the minimum years of credited service. (d) If a member has accrued a full year of service credit for a fiscal year, the annuity shall not begin earlier than on July 1 after the fiscal year ends unless the board adopts by rule or resolution an earlier beginning date for all members whose retirement will not result in a reduction of classroom teachers. (e)(1) A member may cancel an application for voluntary retirement benefits any time before the end of the second full calendar month immediately following the effective date of benefits. (2) The member shall notify the system of cancellation in writing. Upon cancellation, the member shall be eligible for active membership in the system.

Ark. Code Ann. § 24-7-705 Life annuity.

(a)(1)(A)(i) For a member who is retired or who is in the Teacher Deferred Retirement Option Plan as of June 30, 2013, the multipliers used at the time of retirement or entry into the Teacher Deferred Retirement Option Plan shall remain the multipliers used to calculate the member's retirement benefits for retirement or the Teacher Deferred Retirement Option Plan. (ii) For all service earned through June 30, 2013, by a member who is active or inactive on June 30, 2013, he or she shall receive a straight life annuity equal to his or her number of years of credited service for which member contributions were made as provided in § 24-7-406 multiplied by two and fifteen-hundredths percent (2.15%) of his or her final average salary, or a straight life annuity equal to his or her number of years of credited service rendered after June 30, 1986, for which no member contributions were made as provided in § 24-7-406 multiplied by one and thirty-nine hundredths percent (1.39%) of his or her final average salary, or a combination of both. (B)(i) The multipliers in this section shall be determined in accordance with this chapter and the rules and resolutions of the Board of Trustees of the Arkansas Teacher Retirement System as is actuarially appropriate for the Arkansas Teacher Retirement System. (ii) Before increasing a benefit as provided in this section, the board shall file relevant information concerning the actuarial appropriateness of the action with the Joint Committee on Public Retirement and Social Security Programs. (2)(A) For a member contributing on only the first seven thousand eight hundred dollars ($7,800) of each annual salary after June 30, 1969, each annual salary used in computing his or her final average salary shall be limited to a maximum of seven thousand eight hundred dollars ($7,800). (B) The limit shall apply to his or her total credited service. (3) For a member retiring with benefits to be computed on both contributory and noncontributory service under this subsection and free military service first credited after July 1, 1986, under § 24-7-602, the amount of military service to be used in the computation of benefits under this subsection shall be prorated on the ratio of membership service under each plan to his or her total membership service, notwithstanding the fact that some of the military service shall be credited as noncontributory service before July 1, 1986. (4) All purchased military service, all out-of-state service credited under § 24-7-603, and all overseas service credited under § 24-7-604 shall be counted as contributory service, and benefits based on this service shall be computed using the contributory percent of final average salary set forth in this subsection. (b)(1) The multiplier on service credit earned shall remain two and fifteen hundredths percent (2.15%) for contributory service and one and thirty-nine hundredths percent (1.39%) for noncontributory service unless the rates are adjusted by the board. (2) The board may adjust the multiplier for contributory service rendered after June 30, 2013, as follows: (A) The multiplier rate for contributory service set by the board shall remain in effect unless adjusted by the board; (B) The multiplier rate for contributory service shall not be less than one and seventy-five hundredths percent (1.75%) or higher than two and fifteen hundredths percent (2.15%); (C) An increase or decrease to a multiplier rate for contributory service shall apply to a complete fiscal year; (D) The multiplier rate for contributory service may be adjusted by resolution adopted by the board at a board meeting; (E) Once a multiplier rate for contributory service is earned in a fiscal year, the multiplier rate may be subject to an increase but not a decrease if adopted by the board; (F) The board may leave the multiplier rate for contributory service earned in previous years in effect even if the multiplier rate for contributory service is increased for future years; (G) The board may set a special contributory multiplier rate for the first ten (10) years of service credit as follows: (i) The multiplier rate for contributory service used for the first ten (10) years of service shall not be less than one and seventy- five hundredths percent (1.75%) or more than two and fifteen hundredths percent (2.15%); and (ii) After a member earns ten (10) years of credited service, the board may increase the multiplier rate earned in the first ten (10) years to the standard multiplier rate for contributory service for all or part of the first ten (10) years of service. (3) The board may adjust the multiplier rate for noncontributory service for all service rendered after June 30, 2013, as follows: (A) The multiplier rate for noncontributory service set by the board shall remain in effect unless adjusted by the board; (B) The multiplier rate for noncontributory service shall not be less than five-tenths of one percent (0.5%) or higher than one and thirty-nine hundredths percent (1.39%); (C) An increase or decrease to a multiplier rate for noncontributory service shall apply to a complete fiscal year; (D) The multiplier rate for noncontributory service may be adjusted by resolution adopted by the board at a board meeting; (E) Once a multiplier rate for noncontributory service is earned in a fiscal year, the multiplier rate may be subject to an increase but not a decrease if adopted by the board; (F) The board may leave the multiplier rate for noncontributory service earned in previous years in effect even if the multiplier rate for noncontributory service is increased for future years; (G) The board may set a special noncontributory multiplier rate for the first ten (10) years of service credit as follows: (i) The multiplier rate for noncontributory service used for the first ten (10) years of service shall not be less than five-tenths of one percent (0.5%) or more than one and twenty-five hundredths percent (1.25%); and (ii) After a member earns ten (10) years of credited service, the board may increase the multiplier rate earned in the first ten (10) years to the standard multiplier rate for noncontributory service for all or part of the first ten (10) years of service. (4) A lower multiplier rate set by the board for contributory service and noncontributory service earned in the first ten (10) years of service shall not be retroactively applied. (5) The board shall not reduce the multiplier rate for contributory service earned after the first ten (10) years of service unless the: (A) System's actuary certifies to the board that the amortization period to pay the unfunded liabilities of the system exceeds eighteen (18) years; and (B) Board determines that a reduction in the multiplier rate for contributory service is prudent to maintain actuarial soundness. (c) For all service credit earned by a member after June 30, 2013, he or she shall receive a straight life annuity equal to his or her number of years of credited service multiplied by his or her final average salary as follows: (1) Credited service for which member contributions were made under § 24-7-406 shall be multiplied by the contributory multiplier in effect for each fiscal year; (2) Credited service rendered after June 30, 1986, for which no member contributions were made under § 24-7-406 shall be multiplied by the noncontributory multiplier in effect for each fiscal year; and (3) If the member has accrued both contributory service and noncontributory service, the member's service shall be combined after calculating each amount under this subsection. (d) Upon a member's retirement, as provided in this act, he or she shall have the right to elect an option provided for in § 24-7-706. (e) A member retiring before July 1, 1987, shall receive an annuity in accordance with provisions of law in force before July 1, 1987.

Ark. Code Ann. § 24-7-707 Deferred retirement.

(a)(1)(A) If an active member becomes inactive before the member reaches sixty (60) years of age and completes five (5) years of actual and reciprocal service or if the member has not obtained a refund or participated in a buyout plan of the member's rights to benefits in the Arkansas Teacher Retirement System under § 24-7-505, then the member is entitled to a deferred annuity when the member becomes sixty (60) years of age as provided in this section. (B) The member is eligible for deferred retirement if the member has not withdrawn his or her accumulated contributions from the members' deposit account, has not participated in a buyout plan of the member's rights to benefits in the system under § 24-7-505, and is not employed in a position covered by another retirement plan that is supported wholly or in part by state contributions if the member's being vested is based on the other system service. (2) Upon approval by the Arkansas Teacher Retirement System, the deferred annuity shall commence as of the first day of the calendar month following the date the written application is received by the system. (3) A member shall elect an option provided for in § 24-7-706 at the time of filing the written application. (b) An inactive member's deferred annuity shall be a life annuity as provided for in § 24-7-705. (c) In the event the inactive member dies before qualifying for deferred retirement, no benefits whatsoever shall be paid except under the provisions of § 24-7-711. (d) If a member fails to submit a complete deferred retirement application by the end of the sixth full calendar month immediately following the effective date of benefits, including all additional documentation required by the system, the application shall be void unless an extension is granted by the Executive Director of the Arkansas Teacher Retirement System. (e)(1) A member may cancel an application for deferred retirement benefits any time before the end of the second full calendar month immediately following the effective date of benefits. (2) The member shall notify the system of cancellation in writing. Upon cancellation, the member shall be eligible for active membership in the system.

Ark. Code Ann. § 24-7-708 Employment of retired members by covered employers.

(a) Effective July 1, 2009, after terminating employment under § 24-7-502 or reaching the normal retirement age, a retiree may: (1) Accept employment with an employer covered by the Arkansas Teacher Retirement System without a limitation of his or her retirement annuity; and (2) Continue to receive his or her monthly retirement annuity. (b) Employers covered by the system that hire an employee who meets the conditions under subsection (a) of this section shall report the hiring of the retiree to the system in a time and a manner that the system may reasonably require. (c) A retiree who receives monthly benefits and is employed by a covered employer shall not accrue additional service credit. (d)(1) For a retired member employed in a position covered by the system, the covered employer shall remit the contributions on all salary paid to the retiree in an amount equal to the employer contribution rate applicable to active members. (2) Contributions shall be paid by the employer and are not the responsibility of the retiree. (e)(1) The Board of Trustees of the Arkansas Teacher Retirement System shall adopt rules to carry out the provisions of this section. (2) A covered employer that employs retirees is subject to the rules adopted by the board.

Ark. Code Ann. § 24-7-711 Refund of member contributions upon termination.

(a)(1) If a member discontinues covered employment and does not plan to be rehired by a covered employer, the member may elect to be paid a refund of his or her contributions and regular interest credited to the member's deposit account within six (6) months following the date the member's written application is filed with the Arkansas Teacher Retirement System. (2) Any contributions remaining on deposit shall accrue regular interest at the end of each fiscal year as provided by law. (b)(1) If an active member dies and a survivor annuity is not payable under § 24-7-710, the member's accumulated contributions and regular interest to the time of payment shall be paid to such persons as the member shall have nominated by a written designation that is executed by the member and filed with the system. (2) If there are no designated persons surviving the member, the accumulated contributions are payable to the member's estate. (3) If no annuity is payable to a dependent child on account of the member's death and if the sole beneficiary who can receive the annuity is the member's surviving spouse, then the member's surviving spouse may elect to receive a refund of accumulated contributions and regular interest paid under this subchapter. (4) For members dying before July 1, 2011, with an unpaid residual balance, interest on the deceased member's accumulated contributions under this subsection shall cease to accrue after July 1, 2011. (5) Regular interest on a deceased member's accumulated contributions under this subsection shall cease to accrue on the July 1 after the member's death. (c) A member or surviving spouse who elects to receive a refund of member contributions under this section also cancels all the member's service credit, including noncontributory service credit, and all membership rights and beneficiary designations in the Arkansas Teacher Retirement System.

Ark. Code Ann. § 24-7-712 Determination of benefit program.

Any member last terminating teacher service before July 1, 1973, shall receive, or shall have paid on his or her behalf, benefits in accordance with the benefit program in effect at the time of retirement.

Ark. Code Ann. § 24-7-713 Retirement annuity — Simple cost of living adjustment and monthly benefit stipend — Definition.

(a)(1) July 1 of each year, retirees, survivors, participants in the Teacher Deferred Retirement Option Plan, and annuity beneficiaries who have been receiving monthly benefits for the previous twelve (12) months shall receive a simple cost of living adjustment. (2) The cost of living adjustment under this section is calculated by multiplying one hundred percent (100%) of the member's base retirement annuity times three percent (3%). (3) The redetermined amount shall not be less than the base amount. (4) As used in this section, “base amount” means the amount of the benefit payable at retirement plus any one-time increases granted by legislative change after the member's effective date of retirement benefits, excluding the simple cost of living adjustment under this section and the benefit stipend under subsection (d) of this section. (5) The redetermined amount under this subsection is not considered a benefit enhancement under the limitations under § 24-1-106. (b)(1) A member with at least ten (10) years of actual service in the Arkansas Teacher Retirement System is eligible to receive a benefit stipend in addition to his or her monthly retirement benefit. (2) The Board of Trustees of the Arkansas Teacher Retirement System may modify the amount of the benefit stipend from a maximum of seventy-five dollars ($75.00) per month to not less than one dollar ($1.00) per month for eligible benefit participants as a benefit supplement in addition to the cost of living adjustment under subsection (a) of this section. (3) A benefit stipend increase or decrease adopted by the board shall apply to a complete fiscal year and shall remain in effect until adjusted by the board subject to the limitations under subdivision (b)(5) of this section. (4) The board may adjust the benefit stipend amount by resolution at a meeting of the board. (5) The board shall not reduce the benefit stipend unless the: (A) Arkansas Teacher Retirement System's actuary certifies to the board that the amortization period exceeds eighteen (18) years; and (B) Board determines that a reduction in the benefit stipend is prudent to maintain actuarial soundness. (6) The board may phase in an increase or decrease of the benefit stipend. (7) If a member was eligible for a benefit stipend, the benefit stipend shall be applied to the monthly benefit of the member's designated survivor and option beneficiary. (c) Nothing contained in this section shall require the Arkansas Public Employees' Retirement System to pay any portion of the benefits provided for in this section. (d)(1) The board may remove by board resolution the benefit stipend from the base amount of current retirees and option beneficiaries if the board determines that the removal of the benefit stipend from the base amount is prudent in order to maintain actuarial soundness. (2) The board may phase in the removal of the benefit stipend from the base amount of current retiree and option beneficiaries by board resolution.

Ark. Code Ann. § 24-7-714 Increase in monthly benefits — Acts 1979, No. 655, and Acts 1981, No. 885.

(a) The monthly retirement benefit payable to retirees and beneficiaries of the Arkansas Teacher Retirement System who were retired on or before July 1, 1978, and who were receiving benefits on July 1, 1979, shall be increased as follows: (1) For all benefits to retirees and beneficiaries of the system whose total credited service is before July 1, 1961, a monthly benefit increase equal to one dollar ($1.00) per each year of credited service; (2) For all benefits to retirees and beneficiaries of the system which are based in whole or in part upon credited service rendered after July 1, 1961, a monthly benefit increase equal to seventy-five cents (75¢) per each year of credited service; (3) For benefit increases authorized by subdivisions (a)(1) and (2) of this section, fractional years of service shall be disregarded, and the increase shall be added to the monthly annuity after the annual postretirement increase based on the consumer price index has been applied to the retiree's base annuity; and (4) In the event that there is more than one (1) beneficiary or survivor of a member or retiree receiving benefits, the increases in subdivisions (a)(1) and (2) of this section shall be based upon the member's total credited service. The benefit increase so determined shall be divided between the survivors or beneficiaries in proportion to their base annuities. (b) For retirements effective after July 1, 1978, for which a monthly benefit is payable for the month of July 1981 or later, calculations shall be made as provided in subdivisions (b)(1) and (2) of this section. If the monthly benefit calculated using subdivision (b)(1) of this section is more than the monthly benefit calculated using subdivision (b)(2) of this section, then the difference shall be paid to the retiree as a monthly benefit increase, subject to the provisions of subdivisions (b)(3)-(6) of this section, as follows: (1) Calculate the monthly annuity payable to the member under § 24-7-705, based on the provisions of § 24-7-705, his or her salary record, and his or her service record, all as of July 1, 1978, and add seventy-five cents (75¢) for each year of the member's credited service rendered before July 1, 1978; (2) Calculate the monthly annuity payable to the member under the provisions of § 24-7-705 in effect at the time of the member's retirement; (3) For benefit increases authorized by this subsection, fractional years of service shall be disregarded. The increase shall be added to the monthly annuity after the annual postretirement increase based on the consumer price index has been applied to the retiree's base annuity; (4) In the event that there is more than one (1) beneficiary or survivor of a member or retiree receiving benefits, the increases in this subsection shall be based upon the member's total credited service, and the benefit increase so determined shall be divided between the survivors or beneficiaries in proportion to their base annuities; (5) Any benefit increase created by this subsection shall be effective at retirement but not for any month before July 1981; and (6) If there is any change in § 24-7-705 after the member's retirement, the amount under subdivision (b)(2) of this section shall be recalculated using the changed provisions, and the benefit increase provided by this subsection shall be changed correspondingly.

Ark. Code Ann. § 24-7-715 Benefit rights not subject to legal process — Definition.

(a) As used in this section, “pension assignee” means an individual or entity that is not a designated beneficiary and: (1) Is assigned some or all of a benefit participant’s pension benefits by the benefit participant; or (2) Claims an interest in, or control over, a benefit participant’s plan benefit or an account to which a benefit participant’s plan benefit is deposited. (b)(1) Except as provided in subsection (e) of this section, a benefit participant’s right to an annuity, to the return of accumulated contributions, to the annuity itself, to any annuity option, to a plan benefit, and to any other right accrued or accruing under the provisions of this act, and all moneys belonging to the Arkansas Teacher Retirement System, shall not be: (A) Subject to execution, garnishment, attachment, the operation of bankruptcy or insolvency laws, or any other legal or equitable process; or (B) Assignable or transferable. (2) An employer shall have the right of setoff for any claim arising from embezzlement by, or fraud of, a benefit participant. (3) This subsection does not prevent the right of the system to: (A) Correct errors under § 24-7-205 in any manner provided by law; or (B) Collect any moneys due from or related to a member account associated with a benefit participant. (4) This subsection does not apply to the rollover of distributions as allowed under § 24-7-719. (c) If an inactive member is found by any court of competent jurisdiction of this state to be willfully refusing or failing to support minor dependent children of the individual in violation of a court order providing for such support, although the individual is financially able to do so, then the court may order the accumulated contributions, annuity or annuity options, or any other funds accruing under this chapter to be paid into the registry of the court for such further disposition as the court deems just and proper. (d)(1) If, under the provisions of subsection (c) of this section, a court orders all, or a portion of, a person’s accumulated contributions to be paid into the registry of the court, the payment shall be made by the system to the court. (2) The system shall notify the person of the payment and give the person an opportunity to redeposit the amount of the payment in the system. (3) If the payment is not redeposited, then any system annuity otherwise payable to, or on behalf of, the person shall be reduced in the proportion that the payment bears to the person's accumulated contributions before the payment. (e)(1) A pension assignee shall not use any device, transfer, or other related scheme to circumvent the prohibition against the assignment or transfer of a plan benefit. (2) A device, transfer, or other related scheme under subdivision (e)(1) of this section includes without limitation: (A) The deposit of a plan benefit into a joint account held by a benefit recipient and a pension assignee; and (B) A pension assignee’s authorization under a power of attorney or other instrument to access, or obtain funds from, an account to which plan benefits are deposited.

Ark. Code Ann. § 24-7-718 Minimum financial conditions for benefit increases.

(a) For an increase in benefit formulas to be effective, the regular annual actuarial valuation for the calendar year immediately preceding the effective date of the increase shall be based upon an investment rate assumption as recommended by the system's actuary as financially sound for the Arkansas Teacher Retirement System and set by the Board of Trustees of the Arkansas Teacher Retirement System and shall indicate that up to and including a fourteen-percent-of-pay employer contribution rate is sufficient to amortize all unfunded actuarial accrued liabilities for members over a period of eighteen (18) years or less unless the required contribution rate would exceed fourteen percent (14%). (b) For any increase to be effective on a scheduled date, all increases scheduled for that date must collectively meet the minimum financial conditions. (c)(1) On any scheduled date that the increases do not collectively meet the minimum financial conditions, the Board of Trustees of the Arkansas Teacher Retirement System shall have the authority to delay the increase until the minimum financial conditions are met. (2) Such delayed increase shall only be given on a July 1 and shall be the increase set out in § 24-7-713(b)(1).

Ark. Code Ann. § 24-7-719 Rollover of distributions — Definitions.

(a) As used in this section: (1) “Direct rollover” means a payment by the Arkansas Teacher Retirement System to the eligible retirement plan specified by the distributee; (2)(A) “Distributee” includes a member or former member. (B) The member's or former member's surviving spouse and the member's or former member's spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in the Internal Revenue Code, 26 U.S.C. § 414(p), as it existed on January 1, 2011, are distributees with regard to the interest of the spouse or former spouse; (3)(A) “Eligible retirement plan” means an eligible plan under the Internal Revenue Code, 26 U.S.C. § 457(b), as it existed on January 1, 2011, that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state that agrees to separately account for amounts transferred into such a plan from the Arkansas Teacher Retirement System individual retirement account described in the Internal Revenue Code, 26 U.S.C. § 408(a), as it existed on January 1, 2011, and an individual retirement annuity described in the Internal Revenue Code, 26 U.S.C. § 408(b), as it existed on January 1, 2011, an annuity plan described in the Internal Revenue Code, 26 U.S.C. § 403(a), as it existed on January 1, 2011, an annuity contract described in the Internal Revenue Code, 26 U.S.C. § 403(b), as it existed on January 1, 2011, or a qualified plan described in the Internal Revenue Code, 26 U.S.C. § 401(a), as it existed on January 1, 2011, that accepts the distributee's eligible rollover distribution. (B) The definition of “eligible retirement plan” shall also apply in the case of distribution to a surviving spouse or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in the Internal Revenue Code, 26 U.S.C. § 414(p), as it existed on January 1, 2011; and (4)(A) “Eligible rollover distribution” means 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: (a) The life or life expectancy of the distributee; (b) The joint lives or joint life expectancies of the distributee and the distributee's designated beneficiary; or (c) A specified period of ten (10) years or more; (ii) Any distribution to the extent such a distribution is required under the Internal Revenue Code, 26 U.S.C. § 401(a)(9), as it existed on January 1, 2011; (iii) Any hardship distribution; (iv) The portion of any other distribution or distributions that are not includible in gross income; and (v) Any other distribution that is reasonably expected to total less than two hundred dollars ($200) during a year. (B) A portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax employee contributions that are not includible in gross income. However, such a portion may be transferred only to an individual retirement account or annuity described in the Internal Revenue Code, 26 U.S.C. § 408(a) - (b), as it existed on January 1, 2011, or to a qualified defined contribution plan described in the Internal Revenue Code, 26 U.S.C. § 401(a), or 26 U.S.C. § 403(a), as it existed on January 1, 2011, that agrees to separately account for amounts so transferred, including separately accounting for the portion of the distribution that is includible in gross income and the portion of the distribution that is not so includible. (b)(1)(A) A distributee or other eligible beneficiary receiving a distribution from the system may direct to have any portion of an eligible rollover distribution that is five hundred dollars ($500) or more paid directly to an eligible retirement plan specified by the distributee in a direct rollover. (B) The distribution under subdivision (b)(1)(A) of this section may be made: (i) Despite any provision of this chapter that would otherwise limit a distributee's election under this section; and (ii) At the time and in the manner prescribed by the system. (C) The election under subdivision (b)(1)(A) of this section shall not be allowed for an eligible rollover distribution less than five hundred dollars ($500). (2) The amount under subdivision (b)(1)(A) of this section shall be paid to the trustee of the eligible retirement plan. (3) Effective July 1, 2010, an eligible rollover distribution to a beneficiary who is not the surviving spouse of a member may be directed as provided under 26 U.S.C. § 402(c)(11) to a trustee-to-trustee transfer to an individual retirement account described in 26 U.S.C. § 408(a) or to an individual retirement annuity described in 26 U.S.C. § 408(b). (c) Subsection (b) of this section applies to distributions made under §§ 24-7-709 — 24-7-711, 24-7-716 [repealed], 24-7-720, and 24-7-1308. (d) This section does not require the system to authorize a direct rollover of a distribution if: (1) The distribution is not eligible to be treated as a direct rollover under the Internal Revenue Code; or (2) The depository institution receiving the distribution is not eligible to receive a direct rollover under the Internal Revenue Code.

Ark. Code Ann. § 24-7-720 Lump-sum death benefit — Definition.

(a)(1)(A) I If an active member, T-DROP participant, or a retired member with five (5) years of actual service, including actual service for the year immediately preceding the member's death, dies before July 1, 2007, then one (1) lump-sum death benefit of up to ten thousand dollars ($10,000) shall be paid in equal shares to each person designated by the member as a beneficiary in the manner required by the Arkansas Teacher Retirement System. (B) Effective July 1, 2009, if a member who retired or became a T-DROP participant on or before July 1, 2007, with five (5) or more years of actual service dies, then one (1) lump-sum death benefit of up to ten thousand dollars ($10,000) shall be paid in equal shares to each person designated by the member as a beneficiary in the manner required by the system. (C) If an active member, T-DROP participant, or a retired member with ten (10) or more years of actual service dies on or after July 1, 2007, then one (1) lump-sum death benefit of up to ten thousand dollars ($10,000) shall be paid in equal shares to each person designated by the member as a beneficiary in the manner required by the system. (D)(i) If a member accrues a minimum of ten (10) years of actual, contributory service, regardless of noncontributory service accrued in combination with the contributory service, the member shall receive the maximum lump-sum death benefit as determined by the Board of Trustees of the Arkansas Teacher Retirement System under this section. (ii) Upon the member’s death, the maximum lump-sum death benefit shall be paid in equal shares to each person designated by the member as a beneficiary in the manner required by the system. (iii) The board may set a lump-sum death benefit for noncontributory service as the board deems appropriate. (2) If a member designates more than one (1) beneficiary, the lump-sum death benefit shall be divided equally amongst each designated beneficiary. (3) If all of the member's designated beneficiaries do not survive the member, the lump-sum death benefit shall be paid to the member's estate. (b) The amount of the lump-sum death benefit payments under this section shall be set periodically and not more often than annually by rules and resolutions of the board as the board determines is actuarially appropriate for the system. (c)(1) A benefit enhancement provided for under this section shall not be implemented if it would cause the system's unfunded actuarial accrued liabilities to exceed an eighteen-year amortization. (2) If the system's unfunded actuarial accrued liabilities exceed an eighteen-year amortization, a benefit enhancement provided for under this section shall not be implemented until the unfunded actuarial accrued liability is reduced to a level less than the standards prescribed by § 24-1-101 et seq. (d) Pursuant to the board's fiduciary duty, the board shall implement this benefit provision for lump-sum death benefit payments by either making the lump-sum death benefit payments directly from the system or by purchasing a group life insurance policy for the benefit of system members. (e) A lump-sum death benefit payment under this section is intended to be exempt from income tax. (f) For eligibility under this section, a member is considered active for an additional fiscal year following the last fiscal year that the member renders actual service in a position reported to the system by a covered employer and the member obtains at least one-fourth (¼) year of service credit.

Ark. Code Ann. § 24-7-725 Limitation on benefit enhancement of § 24-7-702.

(a) A benefit enhancement provided by § 24-7-702 shall not be implemented if it would cause unfunded actuarial accrued liabilities of the Arkansas Teacher Retirement System to exceed an eighteen-year amortization. (b) If the system's unfunded actuarial accrued liabilities exceed an eighteen-year amortization, a benefit enhancement provided for by § 24-7-702 shall not be implemented until the unfunded actuarial accrued liability is reduced to a level less than the standards prescribed by § 24-1-101 et seq.

Ark. Code Ann. § 24-7-726 Computation of benefits based on contract salary.

If a person employed in a public school district of this state has received an actual salary reduced below the contract salary due to military service or other government service, the Arkansas Teacher Retirement System shall compute retirement benefits based upon the contract salary and not the reduced salary resulting from the military service or other government service, provided that the system receives the employee and employer contributions in effect at the time service is rendered, plus interest, on the difference between the actual salary and the contract salary.

Ark. Code Ann. § 24-7-727 Compounded cost of living adjustments.

(a)(1) The Board of Trustees of the Arkansas Teacher Retirement System may compound the cost of living adjustment for all retirees and participants in the Teacher Deferred Retirement Option Plan who have received a monthly retirement benefit for the prior twelve- month period. (2) The amount of the benefit under this section shall be redetermined effective each July 1, and the redetermined amount shall be payable for the ensuing year. (3) The simple cost of living adjustment is not payable in the year or years that the board implements the compounded cost of living adjustment. (b)(1) The redetermined amount shall be the amount of the benefit payable as of the immediately preceding June 30 increased by three percent (3%). (2) The redetermined amount shall become the base amount for determining all future cost of living adjustments. (3)(A) The board may reverse a compounding of the cost of living adjustment for all retirees and participants in the Teacher Deferred Retirement Option Plan who benefit from the compounding. (B) If a compounding of the cost of living adjustment is reversed the simple cost of living adjustment shall be used for the year that the compounded cost of living adjustment was reversed and future benefits shall be paid based on the simple cost of living adjustment. (C) The future benefits of a member shall not be reduced to recover any additional benefits paid from the date the board uses a compounding cost of living adjustment to the date the board uses a simple cost of living adjustment. (D) If a compounding cost of living adjustment is reversed, the reversal shall be effective at the beginning of the fiscal year. (4) The compounding cost of living adjustment set by the board shall remain in effect until adjusted or reversed by the board. (5) The board may change the compounding of the cost of living adjustment by resolution at a meeting of the board subject to the limitations under subdivision (b)(6) of this section. (6) The board shall not reverse a compounding cost of living adjustment unless the: (A) Arkansas Teacher Retirement System's actuary certifies to the board that the amortization period to pay the unfunded liabilities of the system exceeds eighteen (18) years; and (B) Board determines by board resolution that reversal of the compounding cost of living adjustment that occurred in 2009 is prudent to maintain actuarial soundness. (7) A board resolution reversing a compounding cost of living adjustment under subdivision (b)(6) of this section may include a chart or proxy formula to be applied when a member has a change in his or her benefits due to divorce, remarriage, or the death of the member or the member's spouse. (8)(A) The board may phase in the reversal of a compounding cost of living adjustment under subdivision (b)(6) of this section by board resolution. (B) Any reversal of a compounding cost of living adjustment under subdivision (b)(6) of this section shall be applied at the beginning of the fiscal year. (c) The benefit provisions provided in subsections (a) and (b) of this section shall be implemented according to rules of the board as is actuarially appropriate for the Arkansas Teacher Retirement System. (d) Before increasing a benefit under this section, the board shall file relevant information concerning the actuarial appropriateness of the action with the Joint Interim Committee on Public Retirement and Social Security Programs.

Ark. Code Ann. § 24-7-728 Computation of benefits based on life annuity.

(a)(1) The Board of Trustees of the Arkansas Teacher Retirement System is authorized to raise the level of benefit to the current retirees and other beneficiaries of the Arkansas Teacher Retirement System . (2) The board may raise the level of benefit to a comparable level increase that matches the increase in benefits that would accrue to active members as a result of any increase in the calculation of a life annuity as provided in § 24-7-705(a)(1) in accordance with any rules the board might promulgate. (b)(1) The amount of any increase for retirees and other beneficiaries shall also be determined in accordance with the rules of the board as is actuarially appropriate for the system. (2) Before increasing a benefit as provided in this section, the board shall file relevant information concerning the actuarial appropriateness of the action with the Joint Committee on Public Retirement and Social Security Programs, and the action shall be reviewed by the Joint Committee on Public Retirement and Social Security Programs.

Ark. Code Ann. § 24-7-729 Adjustment of § 24-7-713 base amount.

The base amount in § 24-7-713 will be adjusted at the same time a benefit increase is granted to active members under § 24-7-728 .

Ark. Code Ann. § 24-7-730 Required distributions.

(a)(1)(A) Notwithstanding the provisions of this subchapter regarding the required dates of distribution of benefits under the Arkansas Teacher Retirement System to former members, the distribution of a former member's benefits under the system shall in any event be made or begun by April 1 of the calendar year following the latter of the calendar year in which the member retires or the calendar year in which the member attains the applicable age. (B) The applicable age for a member is as follows: (i) In the case of a member who attains seventy-two (72) years of age after December 31, 2022, and seventy-three (73) years of age before January 1, 2030, the applicable age is seventy-three (73) years of age; (ii) In the case of a member who attains seventy- three (73) years of age after December 31, 2029, and seventy-four (74) years of age before January 1, 2033, the applicable age is seventy-four (74) years of age; and (iii) In the case of a member who attains seventy- four (74) years of age after December 31, 2032, the applicable age is seventy-five (75) years of age. (2) Distributions shall be made over the life of the member or over the lives of the member and the member's designated beneficiary or over a period not extending beyond the life expectancy of the member or the life expectancy of the member and the member's designated beneficiary. (b)(1) If the member dies after the distribution of benefits under the system commences, the distribution of the benefits shall be continued in accordance with the form of benefit in effect prior to the member's death. (2)(A) If the member dies before the distribution of benefits under the system commences, the entire death benefit, if any, due as a result of the member's death shall be distributed no later than five (5) years after the member's death except to the extent that a written election is made to receive distributions in accordance with subdivisions (b)(2)(B) or (C) of this section. (B) If any portion of the member's benefit is payable to a designated beneficiary, distributions shall be made in substantially equal installments over the life or life expectancy of the designated beneficiary commencing no later than one (1) year after the member's death. (C)(i) If the designated beneficiary is the member's surviving spouse, the date distributions required to begin in accordance with subdivision (b)(2)(A) of this section shall not be earlier than the date on which the member would have attained age seventy- two (72). (ii) If the spouse dies before payments begin, subsequent distributions shall be made as if the spouse had been the member. (D) Notwithstanding the provisions of this subchapter, all distributions of benefits under the system shall comply with the requirements of the Internal Revenue Code, 26 U.S.C. 401(a)(9) and the regulations under the Internal Revenue Code, including United States Treasury Regulation, 26 C.F.R. § 1.401(a)(9)-2 and those provisions shall override any distribution options in this chapter that are inconsistent with section 401(a)(9) of the Internal Revenue Code, 26 U.S.C. 401(a)(9).

Ark. Code Ann. § 24-7-731 Forfeitures.

Notwithstanding the provisions of this subchapter, any forfeitures arising from severance of employment, death, or for any other reason shall not be applied to increase the benefit any member would otherwise receive under the Arkansas Teacher Retirement System at any time prior to the termination of the system or the complete discontinuance of employer contributions thereunder.

Ark. Code Ann. § 24-7-732 System termination or discontinuance — Vesting.

Notwithstanding the provisions of this subchapter, members' accrued benefits under the Arkansas Teacher Retirement System shall be one hundred percent (100%) vested: (1) To the extent those benefits are then funded, in the event there is a partial or complete termination of the system or in the event of a complete discontinuance of employer contributions to the system; and (2) Upon a member's attaining normal retirement age.

Ark. Code Ann. § 24-7-733 Limitation on benefits.

(a)(1) Notwithstanding the provisions of this subchapter, benefits paid under the Arkansas Teacher Retirement System shall not exceed the limitations of the Internal Revenue Code, 26 U.S.C. 415, that are applicable to governmental retirement plans, including without limitation the dollar limitations in of the Internal Revenue Code, 26 U.S.C. 415(b)(1)(A). (2) The annual benefits, as may be increased in subsequent years, that are paid to retirees by the system shall not violate the limitations under the Internal Revenue Code, 26 U.S.C. 415(b), applicable to the annuity effective date under the Internal Revenue Code, 26 U.S.C. 415(d), and benefits shall be paid in a manner that protects the tax- qualified status of the system. (b) For purposes of determining compliance with the Internal Revenue Code, 26 U.S.C. 415, “compensation” is defined as set forth in United States Treasury Regulation, 26 C.F.R. § 1.415-2(d)(2), as it existed on January 1, 2009, and includes any amount that is not includible in the gross income of the member under the Internal Revenue Code, 26 U.S.C. 132(f)(4), as it existed on January 1, 2011.

Ark. Code Ann. § 24-7-734 Lost payees.

(a)(1) Notwithstanding the provisions of this subchapter, each member and each beneficiary of a deceased member shall file with the Board of Trustees of the Arkansas Teacher Retirement System from time to time in writing the post office address and each change of post office address of the member or beneficiary. (2) Any communication addressed to a member or beneficiary at the last address filed with the board or, if no address has been filed, then at the last address as indicated on the records of the employer of the member or beneficiary, shall be binding on the member or beneficiary for all purposes of the Arkansas Teacher Retirement System, and neither the board nor the system shall be obligated to search for or ascertain the whereabouts of any member or beneficiary. (b)(1) If the board is unable within five (5) years after payment of a benefit is due to a member or beneficiary to make the payment because it cannot ascertain the whereabouts of the member or the identity and whereabouts of the beneficiary or personal representative by mailing to the last known address shown on the board's records and neither the member, the beneficiary, or personal representative has submitted the paperwork and forms required by the system before the expiration of the five (5) years, then, and in each case, the board shall direct that the amount shall be forfeited to the trust assets of the system. (2) If the final payment is not delivered in the normal course of business, then the total payment is sent in the following order until delivered: (A) To the member's residual beneficiary, if any; (B) To the member's lump-sum death beneficiary, if any; (C) To the member's estate, if any; or (D) To the system. (c) If a provision of this section conflicts with a provision of the Unclaimed Property Act, § 18-28-201 et seq., the provision of this section supersedes the conflicting provision of the Unclaimed Property Act, § 18-28-201 et seq.

Ark. Code Ann. § 24-7-735 Contract buyout agreement — Settlements — Judgments — Calculation of benefits.

(a) A member shall not accumulate service credit in the Arkansas Teacher Retirement System during the time that payments under a contract buyout agreement, settlement, claim, judgment, arbitration award, decree, or court-ordered payment are paid to the member by the employer unless the member continues to work on-site for the employer, or the service credit or additional salary is purchased as provided under subsection (c) of this section. (b)(1) The employer shall provide a copy of a settlement agreement or court order under this section to the system so that the system can: (A) Prevent the accumulation of service credit for any payments that are not for on-site work for the employer; and (B) Calculate the cost to purchase service credit, additional salary, or both service credit and additional salary as provided under this section. (2) A member shall not receive service credit or additional salary from the system under a settlement agreement or court order unless permitted under this section. (c)(1) The system shall allow a member or employer to purchase service credit, additional salary, or both for the member for service credit the member would have earned but for termination, or salary that would have been paid but for employment discrimination to resolve a claim of wrongful termination or employment discrimination that results in a settlement agreement or court order. (2) The member's official salary record shall be adjusted to include the purchased additional salary which may be used to compute the final average salary at the time of retirement if the purchased salary qualifies for the final average salary calculation. (3) Service credit earned by a member from an employer from the date of termination by an employer to the date of the settlement agreement or court order shall be subtracted from the amount of service credit allowed for purchase under subdivision (c)(1) of this section. (4)(A) Service credit purchased under a settlement agreement or court order shall offset service credit that is earned by the member as an employee of another covered employer during the same period of time covered by the service credit purchased under the settlement agreement or court order. (B) Service credit purchased under a settlement agreement or court order shall not be applied by the system in a manner that allows the member to earn more than one (1) year of service credit in a fiscal year. (d)(1) The cost to purchase service credit, additional salary, or both shall be established using the actuarial equivalent as calculated by the system using the member's service history at the time of the purchase. (2) The system shall use the same factors to determine the cost of the additional salary purchase as used to calculate an additional monthly benefit in the annuitization of a Teacher Deferred Retirement Option Plan distribution. (3) The calculation shall be made with the assumption that the member would have immediately retired at the time of the additional salary purchase.

Ark. Code Ann. § 24-7-738 Return to regular covered employment for service credit after disability retirement — Alternate option to return to disability retirement — Incentive to work.

(a) If a member who has been on disability retirement with the Arkansas Teacher Retirement System returns to regular, covered employment and then returns to disability retirement with the system, the disability retirement benefit shall be the higher of the: (1) Amount that the member would have received if he or she did not return to regular, covered employment; or (2) Recomputed benefit using the additional salary and additional service credit earned by the member under the covered employment. (b)(1) A member who returns to covered employment under this section after disability retirement shall not receive a disability retirement benefit from the system in any month that the member is paid a salary from a covered employer for a work period that is concurrent with the receipt of the disability retirement. (2) Any disability retirement benefit erroneously paid to the member or retiree for a month in which the member receives salary from a covered employer may be recovered by the system as an overpayment as allowed by law.

Ark. Code Ann. § 24-7-739 Annuity payments owed to beneficiary of a special needs trust.

(a) A member who designates a person or the parent or legal guardian of a person who is designated as a beneficiary of an annuity or benefit under § 24-7-706, § 24-7-709, § 24-7-711, or § 24-7-720 may elect to have the annuity or benefit paid to a special needs trust that is established for the benefit of the person under 42 U.S.C. § 1396p(d)(4)(A), as it existed on January 1, 2025, or 42 U.S.C. § 1396p(d)(4)(C), as it existed on January 1, 2025. (b) The parent or legal guardian of a person who is eligible to receive an annuity under § 24-7-710 may elect to have the annuity paid to a special needs trust that is established for the benefit of the person under 42 U.S.C. § 1396p(d)(4)(A), as it existed on January 1, 2025, or 42 U.S.C. § 1396p(d)(4)(C), as it existed on January 1, 2025. (c)(1) The Arkansas Teacher Retirement System shall pay an annuity or benefit directly to a person if at the time that the person is entitled to receive an annuity or a benefit payment under § 24-7-706, § 24-7-709, § 24-7-710, § 24-7-711, or § 24-7-720: (A) A special needs trust has not been established for the benefit of the person under 42 U.S.C. § 1396p(d)(4)(A), as it existed on January 1, 2025, or 42 U.S.C. § 1396p(d)(4)(C), as it existed on January 1, 2025; or (B) A special needs trust established for the person under 42 U.S.C. § 1396p(d)(4)(A), as it existed on January 1, 2025, or 42 U.S.C. § 1396p(d)(4)(C), as it existed on January 1, 2025, cannot be identified by the system or ceases to exist. (2) Subdivision (c)(1) of this section shall not prohibit the system from paying an annuity or benefit to a special needs trust that is later established for the person under 42 U.S.C. § 1396p(d)(4)(A), as it existed on January 1, 2025, or 42 U.S.C. § 1396p(d)(4)(C), as it existed on January 1, 2025, if the special needs trust can be identified by the system and an election is made under subsection (a) or subsection (b) of this section. (d) Nothing in this section shall be construed to require the system to: (1) Establish a trust; (2) Act as trustee; or (3) Verify the compliance of a trust with Arkansas law or federal law. (e) The Board of Trustees of the Arkansas Teacher Retirement System may promulgate rules to administer this section.

Ark. Code Ann. § 24-7-801 Definitions.

As used in this subchapter: (1) “Alternate retirement plan” means a retirement plan based on the purchase of contracts providing retirement and death benefits for the employees of Arkansas State University, the Division of Higher Education employees, and employees of Arkansas's state-supported universities, colleges, or junior colleges that are not a part of the University of Arkansas system; (2) “Board” means the governing body of a college; (3) “College” means any one (1) of the state-supported universities, colleges, and junior colleges not a part of the University of Arkansas system, and Arkansas State University; (4) “Division employees” means the Commissioner of the Division of Higher Education and the professional education employees of the division; (5) “Retirement system” means the Arkansas Teacher Retirement System; (6) “Staff members” means any employee of a college or university who is eligible for membership in any retirement plan; (7) “State” means the State of Arkansas; and (8) “State board” means the Arkansas Higher Education Coordinating Board.

Ark. Code Ann. § 24-7-803 Provisions of subchapter controlling.

Insofar as the provisions of this subchapter are, or may be, inconsistent with the provisions of any other general or special act, the provisions of this subchapter shall be controlling.

Ark. Code Ann. § 24-7-804 Establishment and administration of plan.

(a) The board of any college and the Arkansas Higher Education Coordinating Board may establish and maintain an alternate retirement plan which shall authorize the purchase of contracts providing retirement and death benefits for staff members and employees of the Division of Higher Education. (b) Under the plan, staff members and division employees shall contribute, to the extent authorized or required, toward the purchase of the contracts, which shall be issued to and become the property of the participants. (c) The board of any college which elects to establish and maintain an alternate retirement plan and the Commissioner of the Division of Higher Education, if it elects to establish and maintain a plan, shall have authority to administer the plan and to perform or authorize the performance of all such functions as may be reasonably appropriate in its administration.

Ark. Code Ann. § 24-7-805 Methods of providing benefits — Agent for service of process.

(a) An alternate retirement plan may be a separate system or fund or may be one which participates in a larger system or fund with respect to some or all of the benefits provided thereunder. (b) The benefits to be provided for or on behalf of staff members and employees of the Division of Higher Education under an alternate retirement plan may be provided through insurance policies and annuity contracts, both fixed and variable in nature, or a combination thereof, as specified in the plan, which insurance policies and annuity contracts may be obtained from any insurance company authorized to do business in this state or from any nonprofit company organized and operated exclusively for the purpose of aiding and strengthening educational or scientific institutions by issuing insurance or annuity contracts only to or for the benefit of such institutions or individuals engaged in their services. (c) In any action brought by a staff member or division employee on a policy or contract, any official of the college or the Commissioner of the Division of Higher Education shall be deemed to be the agent of the nonprofit company only for the purpose of service of process on the contract or policy, and for no other purpose.

Ark. Code Ann. § 24-7-806 Procedure for designation of companies to provide benefit contracts.

(a) The board of each college or university, or the Arkansas Higher Education Coordinating Board, shall designate the companies from which contracts are to be purchased under the alternate retirement plan and shall approve the form and contents of the contracts. (b) In making the designation and giving the approval, the board or state board shall give due consideration to: (1) The nature and extent of the rights and benefits to be provided by the contracts for staff members and their beneficiaries; (2) The relation of the rights and benefits to the amount of contributions to be made pursuant to the provisions of this subchapter; (3) The suitability of the rights and benefits to the needs of the staff members and the interests of the college in the recruitment and retention of staff members; and (4) The ability of the designated company or companies to provide the suitable rights and benefits under the contracts.

Ark. Code Ann. § 24-7-807 Participation in plan.

Participation in an alternate retirement plan established pursuant to this subchapter shall be as follows: (1) Any staff member employed or appointed by a college or university on or after the establishment of its alternate retirement plan shall participate in the plan or in the Arkansas Teacher Retirement System; (2) Any staff member employed or appointed by a college or university prior to July 1, 1969, who is a member of the retirement system shall continue in that membership or shall participate in the alternate retirement plan, as provided in this subchapter; (3)(A) Any staff member employed or appointed by a college or university with less than ten (10) years of member service in the retirement system may elect to terminate his or her membership in the retirement system and participate in the alternate retirement plan established by the employing college or university. (B) The election shall be in writing and filed with the retirement system and the disbursing officer of the employing college or university within one (1) year after he or she becomes eligible to participate in the alternate retirement plan, except that, on or after July 1, 1993, until December 31, 1993, any staff member employed or appointed by a college or university who has less than ten (10) years of member service in the retirement system and who has not already so elected may elect to terminate his or her membership in the retirement system and participate in the alternate retirement plan established by the employing college or university. The election shall be in writing and filed with the retirement system and the disbursing officer of the employing college or university. (C) All accumulated contributions to the credit of the staff member in the members' deposit account which is maintained pursuant to the provisions of § 24-7-406 shall be returned to the staff member, and all of his or her credited service under the retirement system shall be cancelled; (4)(A)(i) Any staff member employed or appointed by a college or university with five (5) or more years of actual service who elects to participate only in the alternate retirement plan and who has left his or her contributions in the retirement system shall be eligible to receive an annuity on or after attaining sixty (60) years of age and on his or her retirement from covered employment. (ii) The amount of the annuity shall be determined by the benefit formula of the retirement system at the time of his or her retirement. (B) The election authorized under subdivision (4)(A) of this section shall be made in writing and filed with the retirement system and with the disbursing officer of the employing college or university on or before July 1 of the year in which the person makes the election to participate in the alternate retirement plan. (C) The person's annuity shall begin on the first day of the month following the date his or her application for retirement is filed with the board of trustees on or after his or her attainment of age sixty (60); (5)(A)(i) Any Division of Higher Education employee who transferred from another state department or division covered by a state- supported retirement system may elect to participate in an alternate retirement plan. (ii) The employee shall file written notice of his or her election with the Commissioner of the Division of Higher Education. (B)(i) Any division employee with five (5) or more years of actual service who elects to participate only in the alternate retirement plan and who has left his or her contributions in the retirement system shall be eligible to receive an annuity on or after attaining the normal retirement age and on his or her retirement from covered employment. (ii) The amount of the annuity shall be determined by the benefit formula of the retirement system at the time of his or her retirement. (C)(i) The election authorized under this subdivision (5) shall be made in writing and filed with the retirement system and with the director on or before July 1 of the year in which the person makes the election to participate in the alternate retirement plan. (ii) The person's annuity shall begin on the first day of the month following the date his or her application for retirement is filed with the board of trustees on or after his or her attainment of normal retirement age and on his or her retirement from covered employment. (D)(i) Effective July 1, 2001, staff members who elect to participate in an alternate retirement plan may elect to become members of the retirement system. (ii) Service credit forfeited while a member of an alternate retirement plan cannot be established in the retirement system. (iii) The election to withdraw from the alternate retirement plan and become a member of the retirement system shall be made by December 31, 2001, and notice of the election shall be made in writing and filed with the retirement system and the disbursing officer of the employing college or university by December 31, 2001. (6)(A) Each college or university shall provide to each new employee of the college or university a written document explaining to the employee each of his or her retirement plan options. (B) The written document shall contain a line for the employee's signature verifying that he or she understands his or her retirement plan options. (C) The signed document shall be added to the employee's personnel file.

Ark. Code Ann. § 24-7-808 Contributions.

(a)(1) Any college or university which elects to establish and maintain an alternate retirement plan, and the Arkansas Higher Education Coordinating Board if it so elects, shall contribute to that plan on behalf of each staff member who elects to participate in the alternate retirement plan, or employee of the Division of Higher Education, six percent (6%) of his or her total regular compensation during the continuance of his or her employment. (2) Each staff member who elects to participate in the alternate retirement plan, or division employee, at the discretion of the college or university, shall also contribute thereto six percent (6%) of his or her total regular compensation. (b)(1) At its discretion, the division, college, or university may contribute a minimum of an additional four percent (4%) of the staff member's total regular compensation. (2) The division, college, or university may contribute an amount so that the percentage rate in subdivision (a)(1) of this section plus the additional rate in subdivision (b)(1) of this section equals the total employer contribution rate under the Arkansas Teacher Retirement System if the college or university determines that sufficient funds are available to pay that contribution rate. (3) Each staff member may be required to match that additional contribution by contributing a percentage of his or her total regular compensation as determined by the division, college, or university. (c) In addition to the contributions defined in subsections (a) and (b) of this section, the division or any college or university which elects to establish and maintain an alternate retirement plan may permit a newly eligible employee who elects to establish and maintain an alternate retirement plan and may permit a newly eligible employee who elects to participate in an alternate retirement plan to make incremental increases in plan contributions to reach the required contribution level by completion of the fourth year of participation in the alternate retirement plan. (d) Payment of contributions authorized by this section shall be made by the disbursing officer of the college or university and by the state official charged with the duty of paying salaries to division employees to the designated companies in accordance with the provisions of this section.

Ark. Code Ann. § 24-7-901 Definitions.

As used in this subchapter, unless the context otherwise requires: (1) “Alternate retirement plan” means a retirement plan, based on the purchase of contracts approved by the Career Education and Workforce Development Board before the effective date of Acts 2019, No. 910, which provides retirement and death benefits for the : (A) Instructors and administrative staff of the technical institutes or postsecondary vocational-technical schools of the State of Arkansas; and (B) Staff of the Department of Career Education as it existed before the effective date of Acts 2019, No. 910. (2) “Retirement system” means the Arkansas Teacher Retirement System; (3) “School” means any technical institute or postsecondary vocational-technical school established pursuant to § 6-51-202 for the vocational training of students; and (4) “Staff members” means both instructors and administrative staff of a technical institute or postsecondary vocational-technical school and the staff of the department who are eligible for membership in the retirement system.

Ark. Code Ann. § 24-7-903 Provisions of subchapter controlling.

Insofar as the provisions of this subchapter are, or may be, inconsistent with the provisions of any other general or special act, the provisions of this subchapter shall be controlling.

Ark. Code Ann. § 24-7-904 Establishment and administration of plan.

(a) The Career Education and Workforce Development Board may establish and maintain an alternate retirement plan which shall authorize the purchase of contracts providing retirement and death benefits for staff members. (b) Under the plan, staff members shall contribute, to the extent authorized or required, toward the purchase of the contract, which shall be issued to and become the property of the participants. (c) The alternate retirement plan shall be administered by the board pursuant to a written alternate retirement plan document, which shall be formally adopted by the board prior to the establishment of the alternate retirement plan. (d) The board shall have the authority to administer all alternate retirement plans established pursuant to this subchapter and to perform or authorize the performance of all such functions as may be reasonably appropriate in their administration.

Ark. Code Ann. § 24-7-905 Methods of providing benefits — Agent for service of process.

(a) An alternate retirement plan may be a separate system or fund or may be one which participates in a larger system or fund with respect to some or all of the benefits provided thereunder. (b) The benefits to be provided for or on behalf of staff members under an alternate retirement plan may be provided through insurance policies or annuity contracts, both fixed and variable in nature, or a combination thereof, as specified in the plan. Those insurance policies and annuity contracts may be obtained from any insurance company authorized to do business in this state or from any nonprofit companies organized and operated exclusively for the purpose of aiding and strengthening educational or scientific institutions by issuing insurance or annuity contracts only to or for the benefit of such institutions or individuals engaged in their services. (c) In any action brought by a staff member on a policy or contract, any school, school official, or any member of the Career Education and Workforce Development Board shall be deemed to be the agent of the nonprofit company or insurance company only for the purpose of service of process on the contract or policy, and for no other purpose.

Ark. Code Ann. § 24-7-906 Approval of companies and contracts.

(a) The Career Education and Workforce Development Board shall approve the companies from which contracts are to be purchased under the alternate retirement plan and shall approve the form and contents of the contracts. (b) In giving the approval, the board shall give due consideration to: (1) The nature and extent of the rights and benefits to be provided by the contracts for staff members and their beneficiaries; (2) The relation of those rights and benefits to the amount of contributions to be made pursuant to the provisions of this subchapter; (3) The suitability of the rights and benefits to the needs of the staff members and the interests of the vocational education school and the Department of Career Education in the recruitment and retention of staff members; and (4) The ability of the approved companies to provide the suitable rights and benefits under the contracts.

Ark. Code Ann. § 24-7-907 Participation in plan.

Participation in an alternate retirement plan established pursuant to this subchapter shall be as follows: (1) All staff members shall participate in either the Arkansas Teacher Retirement System or an alternate retirement plan or may participate in both, but participation in both shall be limited to the circumstances described in subdivision (2) of this section; (2) Any staff member who has become fully vested in the retirement system may: (A) Continue as an active member of the retirement system; (B) Discontinue contributing to the retirement system, thus becoming an inactive member of the retirement system, and participate instead in an alternate retirement plan. Under those circumstances, the staff member would be both an inactive member of the retirement system and an active member of the alternate retirement plan; or (C) Participate in an alternate retirement plan and receive all accumulated contributions to the credit of the staff member in the members' deposit account which is maintained pursuant to the provisions of § 24-7-406 and have the member's credited service under the retirement system cancelled; (3) Any staff member who has participated in the retirement system for a period which is insufficient to allow for full vesting of that staff member's retirement system benefits may: (A) Continue as an active member of the retirement system; (B) Discontinue membership in the retirement system and transfer from the retirement system into his or her account with the alternate retirement plan, i.e., roll over all contributions which the staff member has previously made to the retirement system; or (C) Participate in the alternate retirement plan and receive all accumulated contributions to the credit of the staff member in the members' deposit account which is maintained pursuant to the provisions of § 24-7-406 and have the member's credited service under the retirement system cancelled; (4)(A) No staff member may participate in an alternate retirement plan without giving prior written notice of his or her election to participate in the alternate retirement plan. (B) The notice of election shall be in writing on a form established by the Department of Career Education and filed with both the Commissioner of the Division of Higher Education and the retirement system. (C) New staff members shall make the election within ninety (90) days after the date of their employment; (5)(A) Effective July 1, 2001, a staff member who elected to participate in an alternate retirement plan may elect to become a member of the retirement system. (B) Service credit forfeited while a member of an alternate retirement plan cannot be established in the retirement system. (C) The election to withdraw from the alternate retirement plan and become a member of the retirement system shall be made by December 31, 2001, and notice of the election shall be made in writing to the director and the retirement system by December 31, 2001.

Ark. Code Ann. § 24-7-908 Contributions.

(a)(1) The Department of Career Education shall contribute to the alternate retirement plan on behalf of each participating staff member an amount equal to the contribution made by the State of Arkansas for persons participating in the retirement system. (2) Each staff member shall also contribute to the alternate retirement plan an amount equal to the maximum allowable member contribution under the retirement system or, at the option of the staff member, additional amounts allowable under the alternate retirement plan. (b) Payment of contributions by the department which are authorized by the provisions of this section shall be made by the disbursing officer of the department. (c)(1) All staff members who elect to participate in the alternate retirement plan shall so notify the State Board of Workforce Education and Career Opportunities in writing. (2) The board shall establish a procedure for notifying the state official charged with paying the salaries of staff members, which official shall cause staff members' contributions to be withheld and forwarded to the company approved by the board and designated by the staff member.

Ark. Code Ann. § 24-7-909 Extension of group insurance coverage by dependents of deceased eligible employee.

Upon the death of an insured eligible employee of an institution of higher education or of an insured eligible employee who is a member of the alternate retirement plan for employees of the Career Education and Workforce Development Board or of a person retired and receiving benefits under the alternate retirement plan, the dependents of the deceased person shall have the same option to extend the group insurance coverage of the dependents under the state group insurance plan as is afforded dependents of other deceased insured employees and retirees.

Ark. Code Ann. § 24-7-1001 Membership in Arkansas Public Employees' Retirement System for certain employees of state colleges.

(a) The Board of Trustees of the Arkansas Public Employees' Retirement System is directed to include within the membership of the Arkansas Public Employees' Retirement System, as created by § 24-4-103, all employees of Arkansas Tech University, Southern Arkansas University, University of Central Arkansas, and Henderson State University who are not otherwise covered by some other existing public employee retirement plan other than Social Security. (b)(1)(A) The effective date of membership of the employees in the system shall be January 1, 1963. (B) All the employees enrolled in the system shall be subject to the rights, privileges, and limitations of §§ 24-4-101 — 24-4-105, 24-4-201, 24-4-202, 24-4-203 [repealed], 24-4-204 [repealed], 24-4-205, 24-4-207 — 24-4-209, 24-4-301 — 24-4-304, 24-4-401, 24-4-402, 24-4-507, 24-4-508, 24-4-510 — 24-4-512, 24-4-513 [repealed], 24-4-601 — 24-4-603, 24-4-605, and 24-4-606. (2) Becoming members of the system shall be a condition of continuing in or obtaining employment, as the case may be. (3) Any employee included within the membership of the system shall be given credit for service rendered prior to July 1, 1957, as an employee of a public employer, as defined in § 24-4-101, or of any state college named in subsection (a) of this section, if so employed by one of the institutions of higher learning on July 1, 1957. (c)(1) Any employee receiving retirement coverage under the provisions of this section who was an employee of one (1) of the institutions of higher learning on January 1, 1963, may apply for and receive current service credit for service rendered as an employee of that institution from July 1, 1957, to July 1, 1963, but only if the employee pays to the system all necessary contributions, at the rate of four percent (4%) for the employee and four percent (4%) for the employer, that would have been paid had the employee been a member of the system during that time. (2) The contributions shall have been paid in full on or before July 1, 1966. (d) Excluded from the provisions of this section are employees classified as student labor, graduate assistants, and seasonal agricultural workers.

Ark. Code Ann. § 24-7-1002 Membership in Arkansas Public Employees' Retirement System for certain employees of colleges, universities, and community colleges.

(a) All persons, except those who are eligible for membership in the Arkansas Teacher Retirement System as provided for under the Arkansas Teacher Retirement System Act, § 24-7-201 et seq., and except those who are eligible for membership in an alternate system as provided for under §§ 24-7-801 and 24-7-803 — 24-7-808, employed by the University of Central Arkansas, Henderson State University, Arkansas Tech University, Southern Arkansas University, Southern Arkansas University at El Dorado, SAU — Tech at Camden, or a state-supported community college that is other than a campus, unit, or division of the University of Arkansas System or the Arkansas State University System after March 19, 1983, shall be members of the Arkansas Public Employees' Retirement System unless, at the time of employment, they are already members of the Arkansas Teacher Retirement System due to previous employment with an employer covered by the Arkansas Teacher Retirement System. (b)(1) All persons except those who are members of the Arkansas Public Employees' Retirement System or the Arkansas Teacher Retirement System, as provided for in subsection (a) of this section, and except those who are eligible for membership in an alternate system as provided for under the provisions of §§ 24-7-801 and 24-7-803 — 24-7-808, who are employees of the institutions named in subsection (a) of this section shall have the option of remaining members of the Arkansas Teacher Retirement System or terminating membership in that system and enrolling in the Arkansas Public Employees' Retirement System. (2) The election to change systems must be made on or before July 30, 1986.

Ark. Code Ann. § 24-7-1008 Continued membership in retirement plan — Election.

(a)(1) Each instructor and administrative staff member of a state-supported postsecondary vocational-technical school employed on July 1, 1991, shall, within ninety (90) days following the transfer to the technical and community college system established under the Two-Year Postsecondary Education Reorganization Act of 1991, § 6-53-101 et seq., or upon transfer to the system with the approval of the board, elect either to continue membership in the retirement plan in which he or she was enrolled prior to that date or transfer to the Arkansas Teacher Retirement System or any alternate retirement plan currently established for the institution into which it is being merged or consolidated. (2) Once such an election is made, the election is irrevocable during the tenure of employment with the system. (b)(1) Each instructor and administrative staff member of a two-year campus of a four-year institution which is later converted to a technical college or community college under § 6-53-101 et seq. shall, within ninety (90) days following the appointment of the local board, elect either to continue membership in the retirement plan in which he or she was enrolled prior to the conversion or to transfer membership to the Arkansas Teacher Retirement System. (2) Once such an election is made, the election is irrevocable during the tenure of employment with the system. (c) Any other employees of an institution transferring to the system under this section or under the approval of the board shall remain members of the retirement system to which they were enrolled prior to the transfer.

Ark. Code Ann. § 24-7-1009 Retirement plan options for employees of campuses, units, and divisions of the University of Arkansas System.

(a)(1) An employee of a campus, unit, or division of the University of Arkansas System, whose appointment is half-time or greater and the employment is not seasonal, extra help, temporary, or incidental to his or her education, may participate in a retirement plan sponsored by the University of Arkansas System or the Arkansas Public Employees' Retirement System as permitted by the policy adopted by the Board of Trustees of the University of Arkansas. (2) Once an employee makes an election as provided in subdivision (a)(1) of this section, the election is irrevocable during the employee's tenure of employment with the University of Arkansas System. (b)(1) If an employee who is not eligible to participate under subsection (a) of this section becomes eligible under policies adopted by the Board of Trustees of the University of Arkansas to participate in a retirement plan sponsored by the University of Arkansas System or the Arkansas Public Employees' Retirement System, the employee shall participate in a retirement plan sponsored by the University of Arkansas System or the Arkansas Public Employees' Retirement System as permitted by policies adopted by the Board of Trustees of the University of Arkansas beginning on the date the employee becomes eligible. (2) If an employee under subdivision (b)(1) of this section elects to participate in the Arkansas Public Employees' Retirement System as permitted by the Board of Trustees of the University of Arkansas policy, the employee shall receive credit for service for the period of time in which the employee was ineligible to participate if the employee buys service credit by paying in one (1) lump sum: (A) All the employee contributions at the rate and based on the compensation that would have been paid to the employee during the ineligible period of time; (B) All the employer contributions based on the Arkansas Public Employees' Retirement System employer normal cost from the most recently completed Arkansas Public Employees' Retirement System regular annual actuarial valuation and the compensation that would have been paid to the employee during the ineligible period of time; and (C) The regular interest on the employee and employer contributions computed from the date of service that was rendered to the date the payment is received by the Arkansas Public Employees' Retirement System. (c)(1) The University of Arkansas System shall comply with the Arkansas Public Employees' Retirement System rules for an employee of a campus, unit, or division of the University of Arkansas System who is eligible under policies adopted by the Board of Trustees of the University of Arkansas and elects to participate in the Arkansas Public Employees' Retirement System. (2) Notwithstanding any other provision of this section, no employee of a campus, unit, or division of the University of Arkansas System may be permitted to enroll in the Arkansas Public Employees' Retirement System who would not be eligible to enroll under Arkansas Public Employees' Retirement System rules. (d) Beginning July 1, 2011, a new employee of the University of Arkansas System shall not participate in the Arkansas Teacher Retirement System.

Ark. Code Ann. § 24-7-1101 Membership in Arkansas Public Employees' Retirement System.

(a) The Board of Trustees of the Arkansas Public Employees' Retirement System is directed to include within the membership of the Arkansas Public Employees' Retirement System, as created by § 24-4-103, all nonteaching employees of the public schools of this state who are not members of, or eligible for membership in, some other existing state-supported retirement system other than Social Security. (b)(1) The board shall establish a Division of Nonteaching Public School Employees in the Arkansas Public Employees' Retirement System Fund which shall be maintained and operated in the same manner as the State Division, the County Division, and the Municipal Division of the fund. (2) The several school districts of the state, as participating public employers, shall pay into the Arkansas Public Employees' Retirement System Fund such sums of money as are necessary to match the contributions of its nonteaching employees in the same form and manner and subject to all the provisions of §§ 24-4-101 — 24-4-105, 24-4-201, 24-4-202, 24-4-205, 24-4-207 — 24-4-209, 24-4-301 — 24-4-304, 24-4-401, 24-4-402, 24-4-507, 24-4-508, 24-4-510 — 24-4-512, 24-4-513[repealed], 24-4-601 — 24-4-603, 24-4-605, and 24-4-606 to the same extent as other participating employers. (c)(1) The effective date of membership of the employees in the Arkansas Public Employees' Retirement System shall be October 1, 1965. (2) All employees enrolled in the system shall be subject to the rights, privileges, and limitations prescribed in §§ 24-4-101 — 24-4-105, 24-4-201, 24-4-202, 24-4-205, 24-4-207 — 24-4-209, 24-4-301 — 24-4-304, 24-4-401, 24-4-402, 24-4-507, 24-4-508, 24-4-510 — 24-4-512, 24-4-513[repealed], 24-4-601 — 24-4-603, 24-4-605, and 24-4-606. (3) Every employee shall become a member of the system as a condition of continuing or obtaining employment. (d) Any employee included within the membership of the retirement system pursuant to this section shall be given credit for service rendered prior to October 1, 1957, as an employee of a public employer, as defined in § 24-4-101, or as a nonteaching employee of any public school of this state, if the employee was so employed on October 1, 1957, and on October 1, 1965. (e)(1)(A) Any employee included within the membership of the retirement system who was a nonteaching employee of the public schools in this state on October 1, 1965, or who was an employee of one (1) of the institutions of higher learning and who became a member on July 1, 1963, may apply for and receive current service credit in multiples of one (1) year for service rendered from October 1, 1957, to October 1, 1965, in the case of a nonteaching employee of the public schools of this state, or, in the case of an employee of one (1) of the institutions of higher learning, for service rendered as an employee of the institution from July 1, 1957, to July 1, 1963. (B) The employee may receive service credit only if the employee pays to the retirement system fund all necessary contributions, at the rate of four percent (4%) for the employee and four percent (4%) for the employer, that would have been paid had the employee been a member of the retirement system during that time, together with interest at three percent (3%) per annum compounded annually, from October 1, 1965, to the date of payment in the case of a nonteaching employee of the public schools, or, in the case of an employee of one of the institutions of higher learning, from July 1, 1957, to the date of payment. (2) The contributions shall have been paid in full on or before January 1, 1972. (f) In no case shall less than ten (10) days of service in any calendar month rendered by any member mentioned in this section be credited as a month of service, nor shall less than nine (9) months of service rendered in any one (1) fiscal school year be credited as a year of service.

Ark. Code Ann. § 24-7-1301 Election to participate — Conditions.

(a) In lieu of terminating employment and accepting a service retirement benefit pursuant to § 24-7-101 et seq., any person who is a member of the Arkansas Teacher Retirement System and who meets the conditions specified in subsection (b) of this section may elect to participate in the Teacher Deferred Retirement Option Plan and to defer the receipt of retirement benefits in accordance with the provisions of this subchapter. (b) The condition required for participation in the plan is that the member must have at least thirty (30) years of service credit in the system. (c) The Board of Trustees of the Arkansas Teacher Retirement System may promulgate rules necessary for the orderly administration of the plan, including without limitation the rules for eligibility for continuance of deposits for part-time employment.

Ark. Code Ann. § 24-7-1302 Application — Review.

(a) To participate in the Teacher Deferred Retirement Option Plan, the member shall submit a plan application on a form required by the Board of Trustees of the Arkansas Teacher Retirement System. (b)(1) The member's plan application shall be reviewed by the Arkansas Teacher Retirement System within a reasonable period of time to determine whether or not the member meets the eligibility requirements under this subchapter. (2) The member's plan date shall be July 1 next following the determination that the member is eligible for plan participation. (3) A plan application received by the system after May 31 before the beginning of a fiscal year on July 1 shall not be eligible for participation in the plan until the following July 1. (c) The member may withdraw his or her plan application if notice to withdraw is received by the system by the end of the second full calendar month immediately following the member's plan date.

Ark. Code Ann. § 24-7-1303 Contributions to Arkansas Teacher Retirement System.

(a)(1) When a member begins participation in the Teacher Deferred Retirement Option Plan, member contributions to the Arkansas Teacher Retirement System shall cease. (2) Until and on August 31, 2003, employer contributions on behalf of the members participating in the Teacher Deferred Retirement Option Plan that are due the system may be retained by the school districts for the purposes under subdivision (b)(1) of this section. (3)(A)(i) Beginning September 1, 2003, for members whose effective date in the Teacher Deferred Retirement Option Plan is before September 1, 2003, the employer contribution rate to the system on behalf of all members in the Teacher Deferred Retirement Option Plan shall recommence at the rate of: (a) One percent (1%) for the period from July 1, 2003, through June 30, 2005; (b) Three percent (3%) for the period from July 1, 2005, through June 30, 2007; and (c) Six percent (6%) for the period from July 1, 2007, through June 30, 2009. (ii) After July 1, 2009, the covered employer shall remit the contributions on all salary paid to the Teacher Deferred Retirement Option Plan participants in amount equal to the employer contribution rate applicable to active members. (B) The portion of the employer contribution not required to be paid to the system for members in the Teacher Deferred Retirement Option Plan under this subdivision (a)(3), if any, may be retained by the school districts for the purposes under subdivision (b)(1) of this section. (4) Beginning September 1, 2003, for members whose effective date in the Teacher Deferred Retirement Option Plan is on or after September 1, 2003, the employer contribution rate on behalf of members in the Teacher Deferred Retirement Option Plan shall continue at the rate established by the entity having the authority to set the employer contribution rates for the system. (b)(1) It is the intent of the General Assembly that the portion of the employer contribution to the system that has ceased for a participant in the Teacher Deferred Retirement Option Plan, if any, will become a part of the general operating fund of the school district to be used for any purpose, including employee salaries. (2) Except for employer contributions to the system, the school district shall not make contributions to any tax-qualified retirement plan on behalf of any employee participating in the Teacher Deferred Retirement Option Plan. However, this prohibition shall not be applicable to the extent necessary to comply with contractual obligations incurred by a school district prior to February 1, 1999.

Ark. Code Ann. § 24-7-1304 Election of annuity options.

(a) A member who elects participation in the Teacher Deferred Retirement Option Plan may elect one (1) of the annuity options provided in § 24-7-706. (b) The election will be made at the time the member separates from service and is granted a monthly retirement benefit, and will be deemed to apply to the member's plan benefit as well as to the member's monthly retirement benefit from the Arkansas Teacher Retirement System at the time it becomes payable.

Ark. Code Ann. § 24-7-1305 Benefits.

The member's Teacher Deferred Retirement Option Plan benefit shall be the monthly benefit to which the member would have been entitled if the member had actually retired on the plan date without regard to the provisions of § 24-7-708 related to conditions subjecting annuities to limitations.

Ark. Code Ann. § 24-7-1306 Amount of deposits.

(a) Teacher Deferred Retirement Option Plan deposits shall be a percentage of the plan benefit. (b) If a plan participant has at least thirty (30) years of credited service in the Arkansas Teacher Retirement System, including combined service with a reciprocal system, a plan deposit shall be calculated beginning with the participant's plan benefit and then reduced by one percent (1%) for each year of credited service, including fractions of a year. (c)(1) If a plan participant has at least twenty-eight (28) years of credited service but fewer than thirty (30) years of credited service in the Arkansas Teacher Retirement System, including combined service with a reciprocal system, the Board of Trustees of the Arkansas Teacher Retirement System may authorize early participation in the plan. (2) The plan deposit of the early participant shall be calculated beginning with the plan benefit of the early participant, then initially reduced by one percent (1%) for each year of credited service, including fractions of a year, and then may be further reduced by at least an additional five-tenths of one percent (0.5%) but no more than one percent (1%) of the initially reduced plan deposit for each month of credited service under thirty (30) years. (d) The Board of Trustees of the Arkansas Teacher Retirement System is authorized to make further adjustments to the plan by board resolution to make it cost-neutral to the Arkansas Teacher Retirement System.

Ark. Code Ann. § 24-7-1307 Account — Credit.

(a) The member's Teacher Deferred Retirement Option Plan account shall be the account in which shall be accumulated the: (1) Plan deposits made on behalf of the member; and (2) Plan interest. (b) At the end of each fiscal year, the Board of Trustees of the Arkansas Teacher Retirement System shall credit each plan participant's plan account with plan interest on the mean balance in the account for the fiscal year. (c)(1) The board shall determine the plan interest rate to members' plan accounts based on: (A) A fixed interest rate that is adopted by board resolution by the end of the first quarter of the fiscal year in which the interest rate shall apply and that applies to subsequent fiscal years unless modified by the board; or (B) A variable interest rate formula that is based on investment returns and other factors adopted by board resolution by the end of the first quarter of the fiscal year in which the interest rate shall apply and that applies to subsequent fiscal years unless modified by the board. (2) In addition to the applicable interest rate for the fiscal year, the board may adopt by board resolution a Teacher Deferred Retirement Option Plan participation incentive rate during a fiscal year if investment returns justify an incentive rate for the fiscal year. (d) If a participant continues covered employment after completing ten (10) consecutive years in the plan, the participant's plan account shall be credited on June 30 of each year or through the date of retirement, whichever occurs first, with ten (10) year plus plan interest as set by the board. (e) For the purposes of this section, the ten (10) year plus plan interest rate shall be the rate determined to be appropriate by the board and adopted by board resolution by the end of the first quarter of the fiscal year in which the interest rate shall apply and that applies to subsequent fiscal years unless modified by the board.

Ark. Code Ann. § 24-7-1308 Termination of participation in Teacher Deferred Retirement Option Plan — Distribution options.

(a)(1) The member's participation in the Teacher Deferred Retirement Option Plan shall cease when the member files an application for voluntary retirement with the Arkansas Teacher Retirement System under § 24-7-701 and is granted a monthly retirement benefit by the system. (2) The system shall cancel a plan participant's retirement benefits, and the plan participant forfeits any retirement benefits, including plan account benefits, if the participant: (A) Fails to meet the termination of employment requirement of § 24-7-701; and (B) Has not reached normal retirement age. (3) A plan participant becomes eligible again for retirement benefits, including plan account benefits, when the termination requirements are met. (b)(1) When the member's participation in the plan ceases, the member may elect to: (A) Receive the balance in the plan account as a lump sum; (B) Annuitize the plan account as a monthly benefit paid under the annuity option selected by the member; or (C) Receive a part of the balance in the plan account as a lump sum and annuitize the remaining balance. (2) The Board of Trustees of the Arkansas Teacher Retirement System shall: (A) Determine factors to be used for the conversion of plan balances to monthly amounts; (B) Set requirements for the member's election under this subsection; and (C) Modify the options under subdivision (b)(1) of this section by rule as necessary. (3) A member may cancel his or her original election and elect another distribution option under subdivision (b)(1) of this section if the member: (A) Did not elect to receive all or a part of the balance in the plan account as a lump sum payable through an Internal Revenue Code eligible rollover transaction; (B) Has not previously changed his or her election; (C) Cancels his or her election before the end of the second full calendar month immediately following his or her effective retirement date; (D) Files with the system a new distribution election form approved by the system; and (E) Repays the system any amount that he or she is no longer entitled to have received as a result of changing his or her election. (c) When the member's participation in the plan ceases, the board shall cause the member's plan benefit to be paid directly to the member in the form of regular monthly amounts in the same amount and manner as would have been the case if the member had retired on the plan date and had made the same election under § 24-7-706 that was made on or before the plan date. (d)(1) A member who fails to meet the termination requirements and receives retirement benefits shall repay any benefits received before becoming eligible again for voluntary retirement. (2) If the member becomes eligible to receive the plan account distribution before the system collects it back from the member, the system may charge interest on the distribution for the time the member was ineligible to receive the distribution. (e) The system may offset, adjust, or otherwise collect any benefits overpaid to a member under this subchapter.

Ark. Code Ann. § 24-7-1309 Benefits from Arkansas Teacher Retirement System.

In the event that a Teacher Deferred Retirement Option Plan participant applies for benefits from the Arkansas Teacher Retirement System pursuant to § 24-7-704 related to disability retirement, the application shall be treated as an application for voluntary retirement pursuant to § 24-7-701 , and no benefits other than those that would be payable without regard to the disability shall become payable.

Ark. Code Ann. § 24-7-1310 Death of participant.

(a) In the event that a Teacher Deferred Retirement Option Plan participant dies, the benefits payable from the plan shall be determined according to § 24-7-710 and the rules and resolutions of the Arkansas Teacher Retirement System. (b)(1) However, the plan participant's eligible surviving spouse may choose to receive the plan benefit in a lump sum without affecting the payment of a monthly retirement benefit from the Arkansas Teacher Retirement System. (2)(A) Subdivision (b)(1) of this section shall not apply if the member has directed one (1) or more residual beneficiaries under § 24-7-710. (B) If a member has directed one (1) or more residual beneficiaries, the residual beneficiary shall receive the residual benefits payable, and the spousal benefit shall not be paid. (c) The Teacher Deferred Retirement Option Plan participant's residue as used in § 24-7-701 et seq. that, except for the provisions of this subsection, would have been paid under § 24-7-709 shall be calculated as the greater of the following: (1) The accumulated contributions and regular interest credited to the retirement reserve account as of the member's retirement effective date reduced by the total amount of regular annuities paid, further reduced by amounts received from the Teacher Deferred Retirement Option Plan account in the form of lump-sum or annuity payments; or (2) The Teacher Deferred Retirement Option Plan account as of the member's retirement effective date reduced by amounts received from the Teacher Deferred Retirement Option Plan account in the form of lump-sum or annuity payments.

Ark. Code Ann. § 24-7-1311 Term of participation in Teacher Deferred Retirement Option Plan.

(a) The Arkansas Teacher Retirement System's monthly deposit into the member's Teacher Deferred Retirement Option Plan shall not exceed one (1) plan term of ten (10) consecutive years, beginning with the member's plan date. (b) Once a member participates in the plan, the member shall no longer accrue service credit under any state-supported retirement system, even if the member returns to work.

Ark. Code Ann. § 24-7-1312 Federal taxation.

(a) The Teacher Deferred Retirement Option Plan is intended to operate in accordance with 26 U.S.C. § 415 and other applicable sections of the Internal Revenue Code in a manner that protects the tax-qualified status of the system. (b) Any provision of the plan that is found to be in conflict with an applicable provision of the Internal Revenue Code is hereby declared null and void.

Ark. Code Ann. § 24-7-1313 Limitation on benefit enhancement — Acts 1997, No. 953.

(a) A benefit enhancement provided for by § 24-7-1306 shall not be implemented if it would cause the Arkansas Teacher Retirement System's unfunded actuarial accrued liabilities to exceed an eighteen-year amortization. (b) A benefit enhancement provided for by § 24-7-1306 shall not be implemented by the system until the unfunded actuarial accrued liability is reduced to a level less than an eighteen-year amortization.

Ark. Code Ann. § 24-7-1315 Duty of board of trustees.

The Board of Trustees of the Arkansas Teacher Retirement System shall present to the Joint Committee on Public Retirement and Social Security Programs information concerning the statutory authority and actuarial appropriateness of proposed board actions to establish or revise a multiplier, any benefit, or a provision of a deferred retirement option plan.

Ark. Code Ann. § 24-7-1316 Funding objectives of Teacher Deferred Retirement Option Plan — Cost neutrality.

As part of its obligation to ensure that the Teacher Deferred Retirement Option Plan is cost neutral to the Arkansas Teacher Retirement System, the Board of Trustees of the Arkansas Teacher Retirement System is authorized to make further adjustments to the plan to make it cost neutral to the Arkansas Teacher Retirement System.

Ark. Code Ann. § 24-7-1501 Title.

This subchapter shall be known and may be cited as the “ Retirees’ Ad Hoc Increase Act”.

Ark. Code Ann. § 24-7-1502 Benefit generally.

(a)(1) The annual benefit payable to eligible retirees, survivors, and beneficiaries of retirees of the Arkansas Teacher Retirement System shall be subject to a one-time ad hoc increase based on the retiree's years of credited service that is grouped within descending decades as calculated by subtracting the total years of credited service from the date of retirement. (2) A break in credited service is not considered under this subchapter. (3) Teacher Deferred Retirement Option Plan participants shall have the total years of credited service subtracted from the date of entry into the plan. (b)(1) One-half (½) of the annual dollar increase per year of credited service shall be calculated and provided to all retirees, survivors, and beneficiaries of retirees that are eligible to receive this increase. (2) One-half (½) of the annual dollar increase per year of credited service shall be calculated then prorated based on the amount of contributory service credit to total service on the retiree's: (A) Retirement date; or (B) Plan entry date. (3) The amounts under this subsection shall be calculated and provided to all retirees, survivors, and beneficiaries of retirees. (c) The ad hoc benefit is payable to the retirees, survivors, and beneficiaries of retirees of the system beginning on a July 1 that is at least twelve (12) full months after the effective date of a monthly benefit. (d) The ad hoc benefit for a retiree, survivor, and beneficiary of a retiree shall not increase the retiree's current benefit by more than twenty-five percent (25%) of the annuity benefit payable as of the prior June 30.

Ark. Code Ann. § 24-7-1503 Ad hoc benefit formula.

The schedule of decade dollar amounts per year of credited service is: Formula Decades in Which Credited Annual $ Increase Per Year of Service Was Accrued Service Credited Service 2000 – and later $5 1990–1999 $10 1980–1989 $20 1970–1979 $30 1960–1969 $40 1950–1959 $50 1940–1949 $60 1930–1939 $70 1920–1929 $80 1910–1919 $90

Ark. Code Ann. § 24-7-1504 Promulgation of rules — Duty of board.

(a) The Board of Trustees of the Arkansas Teacher Retirement System shall promulgate rules for the ad hoc benefit under this subchapter. (b) An ad hoc benefit under this subchapter shall not be implemented if the ad hoc benefit would cause the Arkansas Teacher Retirement System's unfunded actuarial accrued liabilities to exceed an eighteen-year amortization. (c) The board shall only authorize an ad hoc benefit that is actuarially appropriate for the system. (d) Before an increase of retirement benefit through an ad hoc benefit is authorized, the board shall file relevant information with the Joint Interim Committee on Public Retirement and Social Security Programs regarding the actuarial appropriateness of the increase. (e) The board may reduce the decade increase formula under § 24-7-1503 proportionately on a one-to-one formula basis for each decade when the reduction is actuarially feasible to implement. (f) The ad hoc benefit increase is a one-time adjustment and shall also be used to increase the base amount of a retiree's benefits when calculating any future additional benefit increases.

Ark. Code Ann. § 24-7-1601 Legislative history — Findings — Intent.

(a) It is found and determined by the General Assembly that: (1) The establishment of the Post-Secondary Education Plan is a historical component of retirement legislation that seeks to develop a more equitable retirement system for members of the Arkansas Teacher Retirement System; and (2) Confusion about the intent of the General Assembly concerning the coverage of employees of state-supported universities, colleges, junior colleges, and vocational-technical schools, the Arkansas Higher Education Coordinating Board, the Division of Career and Technical Education, the Adult Education Section, the Office of Skills Development, and Arkansas Rehabilitation Services, and any other entity offering both the Arkansas Teacher Retirement System retirement plan and an alternate retirement plan create uncertainty in the administration of law, and legislative clarification of the law is needed. (b)(1) Historically, the Arkansas Teacher Retirement System has been mandated by the General Assembly to provide retirement benefits for an employee of a public school, public educational agency, or any other eligible employer included for coverage in the Arkansas Teacher Retirement System. (2) Originally, the Arkansas Teacher Retirement System was designed to provide retirement benefits to certified teachers and administrators in the public schools. However, the coverage has gradually been extended to all employees of the public schools and to other public entities that support educational activities in Arkansas. (3) Beginning with legislation in 1967 and continuing through the early 1980s, the General Assembly created a right for certain colleges, vocational-technical schools, and the Arkansas Higher Education Coordinating Board to establish and maintain an alternate retirement plan for its employees and perform all the functions reasonably appropriate in the retirement plan's administration. (4) The general intent of the early legislation was to allow those institutions of higher education employers to offer their employees the option to participate in an alternate retirement plan, the Arkansas Teacher Retirement System retirement plan, or the Arkansas Public Employees' Retirement System retirement plan. (5) The law was designed to encourage recruitment of public school teachers and administrators into postsecondary positions by allowing them to continue in the Arkansas Teacher Retirement System and to encourage recruitment of private and out-of-state educators by the use of the alternate retirement plan that is offered nationwide. (c)(1) The Arkansas Teacher Retirement System requested an Attorney General's opinion for legal clarification, as the laws have been amended over time making the wording difficult to interpret. (2) All public school employees are mandatory members of the Arkansas Teacher Retirement System as a condition of employment. The uncertainty is with employees of institutions of higher education employers, specifically: (A) Whether an institution of higher education employer can exclude a part-time employee from participation in the Arkansas Teacher Retirement System and thereby be exempt from reporting salary and remitting member or employer contributions for its part-time employees; and (B) Whether a retired Arkansas Teacher Retirement System member can be enrolled in the institution of higher education employer's alternate retirement plan with or without separation while simultaneously drawing retirement benefits from the Arkansas Teacher Retirement System. (3) The Attorney General's Opinion No. 2009-164, dated March 16, 2010, concludes that the current laws related to the Arkansas Teacher Retirement System are difficult to understand, as the intent of the General Assembly is not clear, and legislative clarification is required. (d) Therefore, the General Assembly finds that this subchapter is necessary to: (1) Protect the retirement benefits for employees of the public school system; (2) Provide fair treatment and clear intent with respect to part-time employees and full-time employees of institutions of higher education employers; (3) Clarify the obligations of the Arkansas Teacher Retirement System with respect to its members who become employed by an institution of higher education employer; and (4) Set forth requirements that supersede any prior legislation relating to employees of institutions of higher education.

Ark. Code Ann. § 24-7-1602 Definitions.

As used in this subchapter: (1) “Benefits-eligible” means a class of employees, determined at the discretion of a post-secondary or higher education employer, eligible to participate in the Arkansas Teacher Retirement System, an alternate retirement plan, or the Arkansas Public Employees' Retirement System; (3) “Nonmandatory employer” means any public employer that was authorized to enroll new employees into the Arkansas Teacher Retirement System or alternate retirement plan before July 1, 2011; (4) “PSHE employer” means a post-secondary or higher education employer: (A) With employees that may be hired without becoming mandatory members of the Arkansas Teacher Retirement System; and (B) That offers the Arkansas Teacher Retirement System as a retirement plan on or after July 1, 2011; and (5) “PSHE plan” means the plan establishing the right of a new employee of a PSHE employer to participate in the Arkansas Teacher Retirement System on or after July 1, 2011.

Ark. Code Ann. § 24-7-1603 Provisions of subchapter controlling.

(a)(1) This subchapter controls any inconsistent provision of any other law regarding the enrollment and coverage of an employee of a PSHE employer in either the Arkansas Teacher Retirement System retirement plan or an alternate retirement plan that is offered by a PSHE employer. (2) This subchapter is enacted to supersede and specifically control any inconsistent provisions under § 24-7-801 et seq., § 24-7-901 et seq., and § 24-7-1001 et seq. (b) The Arkansas Teacher Retirement System retirement plan is administered under the provisions of the Arkansas Teacher Retirement System Act.

Ark. Code Ann. § 24-7-1604 Coverage for employees enrolled in Arkansas Teacher Retirement System before July 1, 2011.

(a) Beginning July 1, 2011, all current employees of a nonmandatory employer that are current members of the Arkansas Teacher Retirement System may continue membership and continue to accrue service credit in the system without any change in participation in the system if: (1) The employee is: (A) Part-time and the employee continues to provide services in each fiscal year at approximately the same level of service; or (B) Full-time and the employee continues to provide services in each fiscal year; (2) The nonmandatory employer chooses to continue reporting service to the system for the employee; (3) The nonmandatory employer determines that the employee will contribute at least part-time services in subsequent months of the fiscal year if services are not rendered throughout the fiscal year; (4) The nonmandatory employer remits contributions to the system on behalf of the employee during the fiscal year beginning July 1, 2011, and each fiscal year thereafter; and (5) The employee's service with the nonmandatory employer is not terminated. (b) The nonmandatory employer shall remit employer contributions under § 24-7-401 et seq. for an employee under this section and shall be subject to the rights and obligations of an employer under the Arkansas Teacher Retirement System Act for the employees of the nonmandatory employer participating in the system. (c) The employee under this section shall remit employee contributions under § 24-7-406 et seq. and shall be subject to the rights and obligations of an employee under the Arkansas Teacher Retirement System Act. (d) The nonmandatory employer shall provide information in a format requested by the system to allow the system to monitor and track all employees who participate in the system.

Ark. Code Ann. § 24-7-1605 Optional participation by institution of higher education employers on or after July 1, 2011.

(a)(1) A PSHE employer shall adopt and record a policy or designation that identifies which positions at the PSHE employer's institution of higher education are benefits-eligible for retirement benefits. (2) A new employee of a PSHE employer may participate in the PSHE plan if the employee: (A) Is benefits-eligible as determined by the PSHE employer; (B) Is either: (i) A vested member of the Arkansas Teacher Retirement System at the time of initial employment; or (ii) A non-vested member of the system who meets the requirements of a less restrictive PSHE plan adopted by the specific PSHE employer. ; and (C) Signs an irrevocable PSHE plan participation form provided by the system. (b)(1) A nonmandatory employer becomes a PSHE employer upon enrolling a new eligible member with the system on or after July 1, 2011. (2) A PSHE plan employee shall continue as a member in the system retirement plan so long as the member is employed by a PSHE employer. (3) An election to participate in the retirement system plan under this subsection is irrevocable so long as the employee does not obtain a termination refund from the system after the election. (c)(1)(A) A PSHE employer may adopt a resolution that allows a new employee to participate as a PSHE plan employee without being vested in the system. (B)(i) A less restrictive plan is effective when the resolution adopted by a PSHE employer is presented to the system. (ii) A PSHE employer may modify a less restrictive PSHE plan at any time. (iii) A less restrictive plan adopted by a PSHE employer before July 1, 2013, may provide that a new employee hired between July 1, 2011, and June 30, 2013, who was prohibited from participating as a PSHE employee in the system and who would have been eligible under the less restrictive plan adopted by the PSHE plan employer may have an opt-in opportunity to participate in the system. (2)(A) A PSHE employer may adopt an opt-in opportunity as provided under subdivision (c)(1)(B)(iii) of this section by resolution adopted by the governing body of the PSHE employer that allows a benefits-eligible employee who was prohibited from becoming a member of the system from July 1, 2011, to June 30, 2013, because the benefits-eligible employee was not a vested member of the system at the time of initial employment. (B) To participate in the opt-in opportunity provided by a PSHE employer, an employee shall: (i) Have been continuously employed by the PSHE employer once hired after July 1, 2011; (ii) Meet the PSHE employer's less restrictive PSHE plan; and (iii) Elect to become a member of the system between July 1, 2013, and June 30, 2014. (3)(A) A benefits-eligible employee who elects to become a member of the system as provided under subdivision (c)(2) of this section may purchase service credit based on the applicable member employee and employer contribution rates on annual salary plus eight percent (8%) annual interest if the election is made between July 1, 2013, and June 30, 2014. (B) A purchase of service credit under subdivision (c)(3)(A) of this section shall be paid in full within one (1) year of the date that the benefits-eligible member elects to become a member of the system. (4) If a PSHE employer does not adopt a less restrictive plan, the PSHE plan shall remain in effect as provided under subsection (a) of this section. (d)(1) If a benefits-eligible employee at a PSHE employer was prohibited from becoming a member of the system from July 1, 2011, to June 30, 2013, because the benefits-eligible employee was not a vested member of the system at the time of employment, and the benefits-eligible employee has been continuously employed by the PSHE employer, then the benefits-eligible employee may elect to become a member of the system between July 1, 2013, to June 30, 2014. (2) A benefits-eligible employee who elects to become a member of the system under subdivision (c)(1) of this section may purchase service credit based on the applicable member and employer contributions rates on annual salary plus eight percent (8%) annual interest using a special formula if the election is made between July 1, 2013, and June 30, 2014, and is paid in full within one (1) year of the date the benefits-eligible member elects to become a member of the system. (e)(1) The PSHE employer shall remit employer contributions under § 24-7-401 et seq. and be subject to the rights and obligations of an employer under the Arkansas Teacher Retirement System Act once a benefits-eligible employee elects to participate in the system for the employees of the PSHE employer participating in the system. (2) The benefits-eligible employee who elects to participate in the system retirement plan shall remit employee contributions under § 24-7-406 and be subject to the rights and obligations of an employee under the Arkansas Teacher Retirement System Act. (f) The PSHE employer shall comply with the system's verification and reporting requirements that are implemented by the system. (g) A member shall not purchase prior unreported service except as provided under subdivision (c)(2) of this section on or after July 1, 2011, regardless of when service was provided to a nonmandatory employer.

Ark. Code Ann. § 24-7-1606 Concurrent participation and certain salary credit prohibited.

(a) A benefits-eligible employee shall not participate in an alternate retirement plan and continue to accrue service credit with the Arkansas Teacher Retirement System. (b) If a benefits-eligible employee is first employed by a nonmandatory employer or PSHE employer after July 1, 2011, and is concurrently employed by another retirement system employer, all separate days of service shall count for service credit, but only the highest salary of the concurrent retirement system employer shall count to determine final average salary.

Ark. Code Ann. § 24-7-1607 Duties and responsibilities of board.

The Board of Trustees of the Arkansas Teacher Retirement System may promulgate rules necessary to carry out this subchapter.

Source: Public.Resource.Org / UniCourt, Official Code of Arkansas Annotated, Release 78 (2020) (unicourt.github.io/cic-code-ar)URL: https://unicourt.github.io/cic-code-ar/transforms/ar/ocar/r78/gov.ar.code.title.24.htmlFetched: 11/8/2026