SB 1354 Summary

• Establishes the Arizona Employers' Pension Prefunding Plan as a special trust fund allowing public employers to prefund their defined benefit pension obligations.

• Permits the State Board of Investment to manage pension prefunding plan investment accounts and authorize employers to transfer monies into separate, irrevocable accounts.

• Requires the Public Safety Personnel Retirement System board to administer and invest prefunding plan assets through diversified investment portfolios while maintaining tax-exempt status of the plan's income.

• Specifies that prefunding plan assets are separate from the defined benefit pension systems and may only be used to pay employer required pension contributions and administrative costs.

• Allows employers to terminate participation if pension obligations are satisfied, and requires assets to be transferred to pay remaining contributions or returned to the employer if legally permissible.