AZ HB2356

Amends Arizona Revised Statutes section 38-751 regarding the Arizona State Retirement System (ASRS) and establishes procedures for employers that cease participating in ASRS.

Requires ASRS to establish a separate fund for nonparticipating employers (excluding charter schools) with allocated actuarial accrued liability and designated assets calculated based on the funded percentage as of the nonparticipation date.

Nonparticipating employers and their enrolled employees must continue making contributions to their separate fund, with employer contributions calculated to cover payroll-based employee contributions plus amounts to amortize past service funding requirements over a board-determined period.

Removes previous subsection language addressing employers with fifty or more employees that reduced contributing employees by thirty percent over three years or fifty percent over any period, simplifying eligibility criteria for separate fund establishment.

Clarifies that nonparticipating employers cannot alter their irrevocable ASRS agreement and are ineligible to re-participate in ASRS after their nonparticipation date takes effect.