Arizona Laws 38-905.06. Cost-of-living adjustment; members hired on or after July 1, 2018; definition
A. For members who are hired on or after July 1, 2018, each eligible retired member or survivor of a retired member may receive a compounding cost-of-living adjustment in the base benefit as provided in this section.
Terms Used In Arizona Laws 38-905.06
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Determination: means a written document that indicates to a participant and alternate payee whether a domestic relations order qualifies as a plan approved domestic relations order. See Arizona Laws 38-881
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- plan: means the corrections officer retirement plan established by this article. See Arizona Laws 38-881
- retired: means termination of employment after a member has fulfilled all requirements for a pension or, for an employee who becomes a member of the plan on or after January 1, 2012, attains the age and service requirements for a normal retirement date. See Arizona Laws 38-881
- Retired member: means an individual who terminates employment and who is receiving a pension pursuant to either section 38-885 or 38-886. See Arizona Laws 38-881
- United States: includes the District of Columbia and the territories. See Arizona Laws 1-215
B. A retired member or survivor of a retired member is eligible to receive a cost-of-living adjustment under this section beginning the earlier of the first calendar year after the seventh anniversary of the retired member’s retirement or when the retired member is or would have been sixty years of age.
C. A cost-of-living adjustment shall be paid on July 1 each year that the funded ratio for members who are hired on or after July 1, 2018 is seventy percent or more, as reported in the most recent actuarial valuation.
D. An eligible retired member or survivor of a retired member shall receive annually a cost-of-living adjustment in the base benefit based on the average annual percentage change in the metropolitan Phoenix-Mesa consumer price index published by the United States department of labor, bureau of labor statistics, with the immediately preceding year as the base year for making the determination, not to exceed annually the following:
1. Two percent of the retired member’s or survivor’s base benefit if the funded ratio for members who are hired on or after July 1, 2018 is ninety percent or more, as reported in the most recent actuarial valuation.
2. One and one-half percent of the retired member’s or survivor’s base benefit if the funded ratio for members who are hired on or after July 1, 2018 is eighty percent or more but less than ninety percent, as reported in the most recent actuarial valuation.
3. One percent of the retired member’s or survivor’s base benefit if the funded ratio for members who are hired on or after July 1, 2018 is seventy percent or more but less than eighty percent, as reported in the most recent actuarial valuation.
E. The plan‘s actuary shall include the projected cost of providing the cost-of-living adjustment specified in subsection D of this section in the calculation of normal cost and accrued liability.
F. For the purposes of this section, "funded ratio" means the ratio of the market value of assets to the actual accrued liabilities.