HB1118
To Amend The Laws Concerning The Management Of Premium Taxes Under The Arkansas Fire And Police Pension Review Board; And To Declare An Emergency.
AI-Generated Summary
This bill proposes significant changes to the management of premium taxes allocated to firemen's and police officers' pension and relief funds in Arkansas. A primary action is the repeal of a section detailing the Arkansas Fire and Police Pension Review Board's role in certifying funding recommendations for underfunded municipal plans. The bill also shifts the administration of the Arkansas Policemen's Pension Supplement Program and the Future Supplement Fund from the Arkansas Fire and Police Pension Review Board to the Department of Finance and Administration. It amends how these funds are managed and how administrative expenses are handled, allowing the Department of Finance and Administration to retain a portion of funds for administrative costs. Furthermore, the bill revises the process for certifying tax revenue entitlement for cities, towns, and fire protection districts. It also modifies criteria for qualifying for additional allocations to these pension funds, including specific provisions for volunteer firemen's relief and pension funds. The bill declares an emergency, necessitating an effective date of July 1, 2025, for improved financial security and efficiency in managing these premium taxes.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries of this bill, if enacted, would be the Department of Finance and Administration, which would gain administrative control over certain premium tax funds and the related pension programs, potentially leading to increased efficiency and financial security in its operations. Municipal fire and police pension plans, particularly those that are underfunded, could indirectly benefit from changes in administration that aim for greater financial security and efficiency in fund management. Insurers contributing to these premium taxes may see a more streamlined administrative process. The bill also specifies conditions under which firemen's relief and pension funds, especially those providing benefits to volunteer members and meeting specific funding criteria, could qualify for additional allocations.
Who Might Suffer?
The primary group that would be directly impacted by the elimination of the current certification process for underfunded municipal fire and police pension plans is the Arkansas Fire and Police Pension Review Board, as its role in certifying these specific funding recommendations is repealed. This shift in administrative responsibility to the Department of Finance and Administration signifies a reduction in the Review Board's direct oversight in certain areas. Additionally, while the bill aims for efficiency, the transition in administrative duties could potentially lead to a period of adjustment for the entities managing these funds, and any unforeseen administrative issues arising from the transfer could indirectly affect the timely disbursement or management of pension funds.