AZ HB2200

Changes the average monthly salary calculation for corrections officers from one-thirty-sixth of 36 months to one-sixtieth of 60 consecutive months of highest salary within the last 120 months of service.

Creates a new retirement tier for employees hired on or after the effective date, requiring 25 years of service at age 52.5 or 10 years of service at age 62 (versus the current 20 years of service or age 62 with 10 years for existing employees).

Modifies normal retirement pension calculations for new hires to provide 62.5% of average monthly salary at 25 years of service, compared to 50% for existing employees at 20 years of service.

Adjusts member contribution rates, setting them at 8.41% through June 30, 2011, increasing to 8.91% for fiscal year 2011-2012, then capping at 33.3% of aggregate employer contribution or 8.91%, whichever is lower (with a 7.65% minimum).

Modifies the excess investment earnings calculation for benefit increases by establishing a tiered approach based on the funding ratio of the retirement plan, replacing the previous flat one-half calculation.