HB1119
To Amend The Provisions Regarding Delinquent Payments By A Political Subdivision Under The Arkansas Local Police And Fire Retirement System; And To Declare An Emergency.
AI-Generated Summary
This bill proposes amendments to the provisions concerning delinquent payments made by political subdivisions to the Arkansas Local Police and Fire Retirement System. It redefines the timeframe for a political subdivision to be considered delinquent, changing it from ten days after a payment is due to five calendar days before the payment or reporting is due. If a political subdivision becomes delinquent, the Treasurer of State is authorized to withhold all state moneys due to that subdivision until the delinquency and any accrued interest are satisfied. The bill also declares an emergency, stating that a change in administration for managing these delinquent payments is needed for financial security and efficiency. This change would move the administration from the Arkansas Local Police and Fire Retirement System to the Department of Finance and Administration. The emergency clause is included to allow for necessary programming and educational notices to employers before the act takes effect on July 1, 2025. The purpose is to improve the management of these funds for municipal firemen's and policemen's relief and pension funds.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries of this bill would be the Arkansas Local Police and Fire Retirement System and potentially the Department of Finance and Administration, which would gain administrative responsibility. The bill aims to improve the financial security and efficiency of managing delinquent payments, which could ultimately benefit the long-term solvency of the retirement system and ensure timely disbursement of pension and relief funds to its beneficiaries. The broader public, particularly retired and active police officers and firefighters in Arkansas, could indirectly benefit from a more robust and efficiently managed retirement system.
Who Might Suffer?
The entities most directly negatively impacted by this bill are the political subdivisions of Arkansas that may fail to make timely payments or reporting to the Arkansas Local Police and Fire Retirement System. These subdivisions would face the immediate consequence of having state moneys withheld by the Treasurer of State until their delinquencies are resolved. This withholding of funds could create significant financial strain on these local governments, potentially impacting their ability to provide essential services to their constituents. The proposed change in administrative oversight to the Department of Finance and Administration might also necessitate adjustments and new procedures for these subdivisions.