HB 2137 Summary

• Requires employers to pay the Arizona State Retirement System (ASRS) any actuarial unfunded liability resulting from their termination incentive programs.

• Mandates employers notify ASRS before implementing a termination incentive program that may affect ASRS funding.

• Establishes a 90-day payment deadline for employers to remit unfunded liability costs, with unpaid amounts accruing interest at the board-approved actuarial equivalency rate.

• Defines "termination incentive program" as compensation increases of 15% or more (reduced from 30%) within years used for retirement benefit calculations that are not attributed to a promotion.

• Clarifies that termination incentive programs also include any non-standard benefits (monies, credited service, or points) conditioned on employee termination, excluding normal accrued leave payments unless enhanced beyond customary amounts.