HB1347
To Allow The Arkansas Teacher Retirement System To Pay An Annuity Or Benefit Owed To A Person To A Special Needs Trust Established For The Benefit Of The Person.
AI-Generated Summary
This bill proposes to amend the law concerning annuities and benefits under the Arkansas Teacher Retirement System (ATRS). The main purpose is to allow ATRS to pay an annuity or benefit owed to a person directly to a special needs trust established for the benefit of that person. This option is available to members designating a beneficiary or to the parent/legal guardian of an eligible beneficiary. Such payments can be made to special needs trusts established under specific federal statutes (42 U.S.C. § 1396p(d)(4)(A) or (C)) as they existed on January 1, 2025. If a special needs trust has not been established or cannot be identified by ATRS, the annuity or benefit will be paid directly to the individual. The bill clarifies that ATRS is not required to establish a trust, act as a trustee, or verify a trust's compliance with laws. The Board of Trustees of ATRS may adopt rules to administer this new section, which is set to become effective on July 1, 2026.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries of this bill are individuals who are beneficiaries of annuities or benefits from the Arkansas Teacher Retirement System (ATRS) and who also have a qualifying special needs trust established for their benefit. This includes individuals who may require specialized care or support and whose eligibility for certain public benefits could be jeopardized by direct receipt of retirement income. The bill specifically allows the parent or legal guardian of such an individual to elect to direct the retirement payments into the trust, thereby preserving the individual's access to essential services while ensuring their financial support is managed appropriately through the trust structure.
Who Might Suffer?
This bill is unlikely to negatively impact any specific groups or entities directly. The legislation provides an optional payment method for retirement benefits to a special needs trust, rather than mandating it. If a special needs trust is not established, or if ATRS cannot identify it, the benefit will be paid directly to the individual as per existing practice. The bill explicitly states that ATRS is not obligated to establish trusts, act as a trustee, or verify trust compliance. Therefore, the impact on ATRS would be procedural (administering new payment options and potential rulemaking) rather than a direct negative financial or operational burden beyond what is necessary for implementation.