Public Retirement & Social Security Programs-Joint

Share sees a quorum. Those wishing to speak for against the bill please sign up. Glad to see everyone after a break. Mr co chair you have any comments I'm just happy to be here in good see about it. Our first item up will be to review the contract for the Carrero and associates. so. Jeff there are you here. You want to come to the table please. All right so members everybody should have a copy of this contract. Two pages on the very front of your folder. Jill do you want to give a rundown please share Jill fair pure of Legislative Research thank you you're recognized thank you and so this is in front of you a renewal of your contract with Osborn Carreiro and associates here the actuary for this committee and for the General Assembly on any other related matters the only difference in this contract that's in front of you and the one that you're currently operating under is the date it's extending and this your current contract will end on June thirtieth of this year this contract will begin on July first and go through June thirtieth of twenty twenty five in addition there is a slight increase in the pricing proposal of five thousand dollars and we do this contract like all of our other contracts on a maximum contract amount the current one the Max's a hundred and seventy thousand dollars this one is a hundred and seventy five thousand Osborn Carreiro bills asked her project or on an hourly rates that are listed in the pricing proposal be happy to answer any questions and I would also say and what's this con a committee approves this if you do then the final approval will still have to go through the Legislative Council and has its first meeting in may or June whenever all finished the session thank you. Does anybody have any questions of this there. All right they see none I'm sorry representative Max you're recognized I don't question Mister I have a motion at the proper time. All right thank you. The other questions. Senator Hickey you're recognized just if we could get I just would like to ask him one question so it's just five thousand more I understand but all hourly rates the same. They have have they noticed that they did not contract for enough hours before I mean a couple hundred dollars an hour it looks like to me that's an additional twenty five hours which is I know is not significant but was that the reason for that or do we ask I would defer to Jody Carreiro on that. Mr. That's what. Mr please come to the table and identify yourself. Good morning Jody Carreiro your axe actually for the committee Senator we've we of not. Since we've done been under this dollar contract we've never got close to the maximum so as a matter of putting a little bit in for inflation for the last couple years just so that that you know we don't get caught. Okay under so what is really not inflation because you leave an hourly rate the same and well the army right actually I think the hourly rate actually went up ten dollars on on my time which is the problem most of the time it goes into this okay it did go up ten dollars an hour okay all right. Okay but the session in and round dollars the session is cost you guys fifty to seventy five thousand every year for the last several sessions right I just want to understand what your thought process what was because I didn't think that the hourly rate. Hadwin up any had it to go up a little it did go up a little bit Mr you think that's correct then yes Sir I'm sorry I didn't mention that okay well that's by whatever we set the date changes I didn't know that that are rated at one of any so yes that would to that would be part of it thank you Sir. Right. Any other questions all right. The representative Maddox. Thank you Mister chair I make a motion to recommend approval this contract to the Arkansas Legislative Council. All right we need second all right a discussion all those in favor say aye are any opposed. All right the. Ocean has been approved we will send that to a LC. All right. The to move over. Representative Warren you're recognized to present house bill twelve oh three I think you have an amendment we need to look at. Thank you Mr chairman yes there is an amendment and I would ask that John Wilkerson and Jody Carreiro join me at the table police okay. Gentlemen if you join representative worn at the table go ahead their dish yourself for the record. I'm Jody Carreiro actuary for the committee. John Wilkerson general counsel the Arkansas municipally okay you're recognized to present the amendment. Thank you Mr chairman committee members the purpose of this amendment is basically to make sure that there is no double dipping. When we. President when I present this bill it is to allow mayors to participate in a municipal retirement plan this amendment will block them from participating in any other. Retirement plan state or otherwise if they participate in the municipal plan we just don't want to have the possibility of double dipping so that's what this amendment does. I would appreciate a good vote do you have any questions. Representive Collins you're recognized for a question. Thank you and and I obviously support that that's good idea I just kind of wonder how to works or we were not able to really buying what another retirement plan does right so would we would we prevent them from receiving under this retirement plan for that period of time where there would be a double that. That that is my understanding okay thanks. Senator Mark Johnson you're recognized for a question thank you Mr chairman of. Chairman one I just want to clarify my mind that is part of what our representive colleges said might cover say someone retired is a teacher and then I say Gee I think I'm going to run for city council may serve a few years and then they. Run for mayor elected and serve a few years that would not be negated by the fact that they're they're receiving the the teacher retirement based on this. It would be a separate if they have retired from teacher retirement you all can correct me if I'm wrong they would still get the teacher retirement Hey and then this would be a separate. retirement we just don't want them getting paid retirement for serving mare at the same time in two different systems a state system and the school system okay correct thank you Sir thank you Mr okay and committee I will remind you we're we're dealing with the amendment right now we need to get it adopted the to speak to the entire of. Bill. Okay hold on just one second. A representative for I was already keyed in is about the amendment or relocate adopted them okay so I have a motion and a second to adopt the amendment is there any discussion all in favor say aye. Any opposed. The amendment is adopted now going to the bill represent of rye has a question all right. Question gentleman it'll make mayor is serving eight years how many years of credit is a year that. When they would get they would get eight years the the retirement for mayors is a municipality by municipality set up and the mayors have. Certain eligibility is to get that and so they service mayor for eight years and and then that that's how much credit that we get the the classic example is in the. In in my letter is a mare that service for eight years but then has four other years of city service that they can. Count that one for every two years to get the ten years to be eligible for a mayor's retirement so so actually you have one year for one year as mayor and one half of the year as a regular employee. Right as far as eligibility is concise right thank. Any further questions by the committee. Is there anybody is signed up per wishes speak for against this bill. Seeing none. Are you representative warned would you like to close for your bill I'm closed. I would like to make a motion I'd like to make a motion to pass please. As amended as amended thank you their second. I have a motion and a second all favor say aye by any opposed congratulations your bill passes as Mister chairman thank you Committee. For. I guess. Represented representative Matt Linden in the room okay we'll put that one on hold for a minute. A. Got. Yeah I'm gonna have a. Blake pass out The Amendment here. Representative Backlund then you're recognized to present house bill twelve fifty three. Thank you chairman thank you Committee I'm going to present the amendment first please okay so this is an amendment to house bill twelve fifty three The Amendment is a couple of things that are clean up we had some feedback from the AG's office as well as some feedback from a and R. from you of a systems and so we've done some clean ups and you'll see on the first one is we just deleted some language that referred to someone who renders advice pull that out on we also added that we are exempting individually directed defined contribution plans and made a couple other. A simple clean ups. Okay do you have any questions for representant macalin done on amendments. Okay. Senator Chesterfield you're recognized. Thank you madam chair and thank you for taking my questions this early in the morning is this agreed to now is everybody okay with the bill yes ma'am okay thank you I move adoption of the amendment thank you okay we have a motion to adopt the amendment I have a second all right got a second any discussion. All those in favor say aye. Any opposed your amendment has been approved thank you if you would like to please proceed with the presenting your bill thank you I appreciate that so that today I bring you H. B. twelve fifty three is amended this it is the state government employee retirement protection act this bill basically reiterates requires that all investing was depictions must be made solely on the basis of pecuniary interests and not on any social environmental interest it is what our investors have been doing for the state they are investing based on the you can marry interest for this is just to reiterate and make sure that this is what happens it also requires that voting shares be voted in the best interest of the president to participants and not rely solely on the proxy firm to make those judgments I as I mentioned earlier I have worked with you have a systems and made amendments to accommodate the request I'm Thank you Matt thank you Mr chair will representative mac amend and if it's just a reiteration why we need to say it again because we're seeing a movement towards people are investing in ways that are not necessarily in the best interest in the fiduciary interest of the eight participants in the program and I want to make sure that we don't deviate from what we've been doing. So it is a protection. I see. But. Is there any anyone in among any of the retirement systems that have any concern about the bill. Thank you. The representative I mean represent Collins you're recognized. Thank you Mr chair so if this were to pass and that other yes you bill were to pass how would those two interact since I believe that one if you know what I'm talking about represented well as bill that does require consideration of things beyond the queue near interest so I mean with that being conflict with what we're trying to do here so I'm I have shared this with representative Wardlaw before of actually either of our bills were filed in I think this one is complementary to his I think his goes a little bit further than mine but I think that they are complementary and what I'm doing is not in conflict what he's doing. Well I I guess I'm just a quick follow up I mean what he's doing does really require you to look at what the you know funder or whoever a custodian is doing beyond making money for the for the plan right so I mean that would be and I I don't have a problem with with keeping that out but I just wonder I mean you you just think it's not an contractors acquired I think that my bill is not in conflict with his bill this is necessarily I think his bill goes further than my bill does so I am saying that you can't invest in funds because they are focused on environmental issues or social issues that you actually have to see a good return as I understand his bill and he would have to speak to his own bill of course but as I understand it has may go a little further than that saying making sure that the company who does the investing isn't doing that and that is not addressed but that would be okay under your bill. It is not restricted under Michael yes I don't even speak to the investing company okay the bill or. Senator Hickey you're recognized. And maybe we need to retirement people appear course I've voted against the other bill have a huge problem with the other bill personally because I've been being in finance all those years I understand that sometimes you have to you know the people that are in those funds is based solely on my opinion on on getting the best return for them as. As it should so I don't guess I understand exactly what your bill does I think you're going to have to or some of them are gonna have to get up here and we're going to hear a little bit more about this as far as I'm concerned. So. If you have somebody that's going to invest in. Some stock and let's just say that they're in the yes G.. You're saying that our retirement funds are still going to be able under your bill are going to be able to invest in those. Hey when would that not be able to invest in so all things being equal okay let me so if you if you for example the U. of a system I know in there In their pension they have actually a pension that is for social investing which is fine under my bill. As long as the stocks that are in that are picked because they provide a good return so what you can't do is just say well you know I don't really care about the return I just I have this these ideas that I want to promote so I want to be divested of all coal companies for example we can't just say that if call happens to be companies that are returning really really good returns and non coal companies are returning that returns so you cannot put the political agenda above the return for the people her dispensing the program which makes total sense to you and me right I just am trying to codify that and make sure that we as we have seen that happen in other places Senate were voting shares for example in West Virginia they gave their voting shares a proxy companies who then voted against coal companies will West Virginia is cool right and that was not in the best interest of the state to do that but they didn't know until they looked into it because they have relied on the property company to do that and so this is codifying and saying let's be sure that that doesn't happen we want to be sure that anything that is done is done in the best restaurants interest of the participants in the program that they are getting the best return possible and that when we are voting or cheers we are voting in the best interest of our state as well as for the participants and so that's all this is saying is let's just make sure it is what we think investing should be is to invest in the best interest people and all I'm saying is let's just make sure that no one else no one's personal agenda whether it's mine or someone else's it's in the in the women's. Which is a hundred percent what if if that's exactly everything's in here that's a hundred percent what I agree with because personally from those retirement funds and now you know somebody threw something that means they will get Hickey you know I think you voted to you know against the are you vote for the for the bill which you know exempted Israel or whatever that goes a little bit further from me but from my standpoint really I don't care what what they're investing in for our members to get those returns as long as are maximized that's right and that's what you're saying your bill. You're saying it takes the political deal out on both ends of the string I'm favoring one or the other I'm not saying you have to invest in conservative versus you know Democrat doesn't know it does not matter you cannot put your political agenda any political agenda above the best interest of the parties which does run contrary with other bill. Okay. Good answer. I'll have a motion that the property to okay Sir Payton you're recognized thank you Mr represent a vehicle in the I want to compliment you I really appreciate this bill because it does preserve the fiduciary responsibility and it reiterates the fact that the money should not be prejudice and and the way it's invested can you speak a little more towards the responsibility of the shareholder to vote instead of of handing off that authority yeah because you know I think you mentioned something about West Virginia or somewhere that were handed off their proxies to somebody that they did not vote their interest correct so if you look on page Page four and five is where to dresses the voting interests and basically it says that you we have to vote we have to follow the guidelines and gauging in voting shares that match the Canary factors only and so if you and if you engage a proxy company you can engage them and that's listed out on I think I top of page five maybe that if you engage that property company then you can engage them if they also are. Voting in the way that is only January right so if you have another property company is using who is voting their shares based on political issues and that is not a proxy company that you can use or that you can turn your shares over two so do then is to be voted by whoever the authority is it is the existing state official has the authority to vote then they have to voted or they have to find a proxy company who understands that we are not putting political interests I'm from. So is any one of us would do individually if we had a proxy voting force correct we consider how they're going to cast that vote correct thank you thank you Mr. Senator Hammer you're recognized thank you Mr and I just like to see it had not yes or no to say time from the retirement age for the retirement system's that everything's been explained is what you also understand to be the way it was presented. And. Are there any issues with any of the retirement systems that they'd want to come to talk at the table to talk about on this bill because I haven't heard from them exclusively serves or anything that anyone ever want to come to the table. When you walk on the table. The. Or would you come to the table please. Please recognize yourself and then. Feel free to speak. All right good morning committee a claim road executor or Arkansas teacher retirement system. Douglas center cleaners or anything that to you feel that we need to be concerned about and and let me just also say this I appreciate you appreciate the leadership that you've shown under the teacher retirement system I think that you've done a stellar job and I think you should be commended for the job that you've done leading the system and This is not a reflection on whoever comes behind you but I think we've just experienced a great loss in you leaving the system I just want that out there publicly I think I think a lot of other things but that's what I think right now say do you thank you do you have anything that you have concerns about with regards to this situation to caution us as legislators moving forward because we want the system to be as profitable as possible while respecting the fact of the we don't want our money invested in certain things and you feel this bill it's that it's that balance. Thank you senator and thank you everyone for those I feel like this was kind of a trick but anyway so let me talk I mean the the if I gather my words I have spoken out against the eighty three thirteen oh seven my biggest concern with H. B. thirteen oh seven is I actually like the West Virginia model of how they handled the ESG legislation. as represent Backlund and has referred to the West Virginia proxy voting so we're just talk about this bill twelve fifty to page B. twelve fifty three I really don't see I mean I think this is an appropriate way to handle this disregard ESG. Position that the teacher retirement system has had ever since the topic of BSG has come up it has been the instruction of our board members to our investment consultants is that anytime we make an investment we want a full due diligence done and not any kind of analysis done on ESG factors the bottom line is the investment should be researched and and you know the due diligence done for a risk reward analysis and at the end of the day what we want the best investments for the system. my biggest disappointment with H. B. thirteen oh seven is essentially that the West Virginia model of that bill essentially excluded the retirement system from that piece of legislation and then had a sister bill if you'd say very similar to fifteen oh three that did include the retirement system's so to me that would be the perfect solution for Arkansas is to follow that model but that is not necessarily the the will of the body but that that's my two cents worth so thank you okay thank you thank you Mr any other questions of. Mr Roden. Thank you so much what what what. Senator Chesterfield you're recognized thank you Clint talked a lot about the other bills is this one okay. I I I would say H. the twelve fifty three is okay thank you that's all I need to hear from the audience thank you motion to property. If you're ready to give me the. All right I think you thank you Mr Roden appreciate your comments and I I want to go on the record the representative macalin done has worked extensively with me I believe this to be a very responsible bill and how it approaches the investments of our retirement system's. The she is look at the pecuniary factors which is to me very responsible we want the best for our retirement system's. I I am not a supporter of thirteen oh seven I will be speaking against the amendments on the floor today. And this is a responsible way to deal with ESG factors so thank you very much for bringing this you have my full support I'll speak for it on the floor thank you and if we pass it right here but so we. You a. Moves motion do pass in the second. Okay Jody do you need to say anything. Yeah. As amended hold on one second. But your two cents injury. Jody Carreiro I think I'm still the actuary for the committee The the one thing that was in mind just a statement and I quote a question for you the the note that I that you have in your packet I'd expressed a concern and just want to know that the amendment address that concern and then my question for the chairs is do you do you want me to get in as amended note for the record this afternoon so that you'll have it on paper so to speak on the record. Okay just follow up with that we'll do a follow will do a follow up with you on video but followed that with written that would gallery and I think the one thing that's not been said is that the and the appropriate concerns have been expressed. Our system is not something is happening with our systems from my discussions with all the different directors they're not going to have to change how they invest one iota they're gonna have to change their directions to their proxy voters the only thing they're going to have to do by this bill is they're going to have to be ready to report how proxies were voted. And that that's that is really to me the administrative addition for our systems. And and that's all of someone's question any questions of Mr Carrero. Okay before we take up that voters or anybody in the audience that would like to speak for or against this bill. Okay all right any discussion. All right do you want to close for your bill representative Michael and I close my bill thank you. All right the discussion. All in favor say aye. Any opposed. Your bill has passed thank you jim thank you committee has been up as been approved. As amended. All right. Yes ma'am. Okay. I got it can carry on all right. All right representative Gazaway you're recognized percent house bill twelve ninety two. Let's find the by this. Okay here you better. Thank you. If you would the have your guest introduced themselves. Thank you Mr chairman representative Jimmy Gazaway represent district thirty one. Matthew Miller with the bureau of legislative research and I I'll noted the beginning I'm not here to testify for against the bill is represented Gazaway oh no here in a moment I'm sure and that this is a code revision commission bill M. bureau a staff for the code revision commission so he asked me to help explain content. Represent Gazaway you're recognized to present the bill thank you Mr chairman members this is a technical corrections bill that comes to us from the bureau of legislative research. Amending title twenty four of the Arkansas Code which is the title the concerns the Tyerman systems and pensions specifically what you'll see in the bill is in section one where their references to system in order to be more clear the word system is replaced with Arkansas public employees retirement system. once again to be more clear as to which retirement system is being referred to. In section two there's some. The arranging of some language of. Basically to correct what is an antiquated grammatical style So that it conforms with the way the code is written today by the bureau sections three and four. And I had some questions about this before we got here today because it strikes some language and we confirm once again this morning which bureau staff confirmed before this bill was prepared to strike some language which is now obsolete essentially there's no one in either of the two retirement systems in section three it's Arkansas teacher retirement system there's no one that fits that definition so that language is completely obsolete in section four where it refers to disability benefits under a lot the we confirm that there's no one who meets the definitions of those sections and therefore it's obsolete and and due to be stricken and so that's why you see that stricken language there that's all the bill does And I'm happy to answer any questions and also turned over to Mr Miller I'm sure can give more explanation. I have nothing further to add but I'm happy to answer any questions you might have. All right up got a motion do pass. The is there anybody in the audience that would like to speak for against the bill. All right they've got a motion to I have a second all right got a second. any discussion. All those in favor say aye. Any opposed. All right your bill has passed thank you represent Gazaway thank you Mr chairman thank committee. But. All right next up representative when you're recognized to present house bill thirteen oh three. And you have an amendment let's We'll have that passed out to everybody. All right. I have a motion to adopt the amendment for even recognized representative **** I appreciate a good vote on the adoption of the amendments all right I got a motion we have a second all right. The representative Fite gives the second any discussion all those in favor say aye. Any opposed all right the Amendment has been approved. Representative weighing you are recognized to present your bill as amended I thank you Mr chair thank you committee what house bill thirteen oh three does it just allows certain cities which had retirement plans in place for the governing bodies to be able to revive one if they choose to do so it has a zero fiscal impact as the cities will be completely financially responsible and that is all this bill does happy to take any questions. Any questions for representative warning. I see none. Well. Senator Hickey you're recognized for a question appreciate I understand no fiscal impact of the state the city's or whatever out there did you did you all did you look at that see what type of it's if it's going to cost on them that was substantial it would be a cost that they would absorb fully in this is all voluntary so only if they want to do this with a chip could they choose to do so but they would fully absorb any cost. Hey I'm looking for that. Million million. Yes shall. S. the. Okay thank you Sir are you a. All right any other questions. All right. All right. Motion do pass as amended. And the second. Is there anybody in the audience that would like to speak for against this bill. All right are you would you like to close for your bill close for the bill appreciate the motion all right we got a motion and a second. Four do pass as amendment is amended the any discussion all those in favor say aye. Any opposed your motion your bill has passed as amended thank you Mr thank you Committee. All right next up is Senator Johnson. The president SP one fifty. And he has an amendment to amendments are popular today. I'll be back. Yes ma'am. I'll be glad to explain Mr. I'm in I'm not. What is a lot of amendments to be trying to figure out as we go through the heart of the bill. It's just difficult to incorporate three pages figure out what the number is the lines and all that I think it's rather. I just have a real problem with asking us to take into consideration three pages of amendment but if when are we going to meet again. We are gonna end up having to meet one more time we we may meet later this week just try to get it done this week either early morning or late afternoon we had two or three Bills that couldn't quite get done so what could we get this one engrossed so that we would be able to follow it more clearly nine at the pleasure let me let the senator Johnson Johnson version is amendments and let let's go from there all right thank thank maybe nobody else has a problem with recommit when I will make this easy for Senator Chesterfield because senator I agree with you this is I think it's a relatively simple amendment but when you see it like this it's not in context of if we are going to have another meeting that I would be happy to ask the committee to adopt the amendment it will have engrossed so we'll have the engrossed bill entered her next meeting moved to adopt the amendment. Okay we've got a motion and a second. Okay. Okay the problem with that is if the amendment is adopted in committee it will not get engrossed because the bill is not a string so what I should probably do counselors I help us I will withdraw the bill from committee today have the amendment adopted on the floor and then sent to engrossing and re referred back to committee set correctly that would be perfect all right and that's what we'll do then I thank members all day and then it will get done I I agree with senator Chesterfield it was complicated I was gonna try to make it simple but this is much better thank you Committee thank you senator. Okay we'll move on then to house bill twelve sixty representative Johnson you're recognized to present. Thank you Mr chairman representative Lee Johnson District forty seven you're recognized to present your bill at the committee this is a bill is brought for by lot the that's supported by the retirement system it's essentially an increase in the multiplier for retirement for the two different written benefits programs up from two point nine four percent to three percent there is a different increase for those programs that are and non success carry covered members that percentage is a little higher to cover that delta for those guys that are under that act different program this cost is covered by one percent increase in contribution from the social security contributions that they and it should be covered under that and I'll be happy to consult with the actuarial center here and some the other folks if there's any questions. All right the. Do we have any representative Collins you have for question thanks could we get someone from Lafayette had salute. There's people here to test on all counts to come and hold my hand in this process. Thanks happy to see. Please recognize yourself and then your. Yes Sir David Clark the executive director of lofty all right yes representative of this bill I would work closely with representative Johnson on as far as the the drafting of it a one make one thing clear though this is not actually a lot the bill it didn't come from the agency came from the membership so you know we work with the membership and obviously is the sponsor to present what you have in front of you today the entire cost is borne by an increase of one percent of the member contribution rate there's no cost shifting to the employers. Okay and I guess that's kind of the the van in which I want to ask so does it the math work out exactly you know based on their actuarial assumptions that this one percent will cover the point six I guess it is zero six one of six on the back end so it because it seems to me like it might be more beneficial for the system perhaps but less so for individuals the but you're saying that it's a it's a perfect match here well as far as cost is but it in the reason why the we came up to the one percent is because the assumptions that were used to make sure that we don't shifting the cost of the employers that is by using a lower assumed rate of return of six point one five percent and then a lairy in a separate amortization period of twenty years the system is gonna be a little over twenty year amortization with close out last year's performance so the numbers to work out that way so you don't think it shifts either way it doesn't shift employer or the members well not this time now just to be fair you know to your question you know if something happens you'll monumentally wrong and in the future with investments that there could be a shifting obviously to the employers at that point but we're saying that the the best. I don't see yes ma'am but the best estimate of what's going on going to happen going forward by using a lower soon rate return that in fact this will make sure the cost is borne solely by the members of the employees thanks. do we have any other questions. All right we have two people signed up to. Okay I'm sorry want to speak for this. Kevin bart Simpson G. like come to the table please. If you would introduce yourself and then you're recognized to speak okay one more symptom state president the Arkansas fraternal order of police. The just wanna speak for this bill H. B. twelve sixties a lot been a long time goal of the FOB and in my career a retired from Little Rock police departments twenty eight years to get the multiplier up to three percent and read for that it helps close that gap for those officers of members of the fraternal order of police that don't pay the social security like we did in Little Rock and also those that actually do help close that gap and good thing about this of our members are willing to pay the costs to to increase our benefits so we strongly support this bill. Okay do we have any questions for Mr Simpson. All right thank you very much Mr Simpson per share presents today. All right. Would you like to close for your bill I'm close Robert thank you Mr okay do we have a motion all right. Motion and a second all right is there any discussion. All those in favor say aye. Any opposed. Your bill has passed expression shall. Your combat. What will the president yes one thirty five. Representative or you're recognized to present S. B. Senate bill one thirty five. Thank you Mr chairman the. Sir Kroll was unable to be with us this morning so I told him I would be glad to the president this I think it's pretty straightforward bill. I'll I'll ask my guest to introduce himself. Governor and state your name and who you're with for the record will be recognized your morning again committee David Clark the executive director of lobby. Go ahead. Thank you Mr chairman Committee SP one thirty five is a proposal brought forward by members of Lotfi fathers does not request is not a request to block the the retirement system does not support this bill SB one thirty five amends the maximum length of participation in lot the deferred retirement option plan the drop plan from the current seven years maximum up to ten years. The average participation in the lot the drop is presently forty months so extending the maximum allowed participation to ten years will likely be used by a limited number of members. However for those members who choose to remain and played as a police officer firefighter while in the drop this amendment is meaningful. If future trends are consistent with current drop participation rates the actuaries do not expect this changed have a financial impact on the retirement system. So basically I think that we've had some long time the. People in the system you're like I I want to keep working. But the drop has limited them to seven years twenty eight regular seven drop. They want to keep working and this blocks them from continuing it it's not the big brass that you would think but I know of one example where it's just a guy that's a motorcycle patrol. So Probably not going to be taken advantage of by a committee but at least it gives the option. I'd be glad to entertain any questions many questions from the members. Representive Andrews recognized for a question. I thank Mr so does affect people who are currently on the drop system. It would allow them an additional three years okay thank you. Senator Hickey you're recognized for a question and just just just because of this I've looked at this drop before it it appears like may not only does it not cost the system any money it almost appears like to me that he could actually make the money would do you all agree with that because of those investments are not being taken out. And we're allowing them to stay then that's actually going to be. Be somewhat of an increase for the system is that correct or my looking at that raw no Sir of Senator Rapert you're looking at this exactly correct is that in fact there is a slight savings to the retirement system at this stage with with the drop that's what we're saying that with the average participation being at forty months the assets stay in the system so it by having those assets remain the system for some period longer than it does make sense of the system actually comes out a little bit ahead and remembers that the deferred retirement option plan is that one word in their option it's optional person doesn't have to enroll in drop if they want to do so these their parameters from which they operate under thank you have like I said we we talk about this drop program before since I've been old vineyard for the last years and it seems like to me there's always a little bit of confusion that it might cost the cost money but again it looks like to me it actually saves it saves money for the planned so I appreciate you saying that yes Sir thank you but I would add to that the I think sometimes it allows us a note teachers and ten right. It It allows us to keep some really good people working so. Thank you. Thank you Senator Hickey any other questions from the committee. Is there anybody in the audience it was to speak for against this bill. Looks like we have given bart Simpson signed up to speak for. State your name and who you're with for the record will be recognized Kevin bart Simpson the state prison the Arkansas fraternal order of police you're recognized. Pretty much already been civil officials say but this bill Help the members of that one stay longer one stay active in the police department it also ring is kinda equal with a TRS I believe April also already has a ten year drop it also helps retain officers at a time when it's getting increasingly difficult to get people to apply to be a police officer so it keeps the good season officer there that want to stay even longer and there is no cost to the system so we strongly support this bill thank you. Is there anybody else you'd like to speak against or for the bill. Representive warned would like to close for the bill I am close for the bill and I would make a motion to pass. Your second. I have a motion and a second do pass any discussion all in favor say aye aye any opposed congratulations your bill is passed. All right members as you've heard of we had about three or four Bills along with senator Johnson's that we still need to hear I was hopeful we could get it all done today for we did not so what my hope is in you guys give me some feedback here. I'd like to try to finish up insert Payton I think Senator cream with me is we'd like to finish up this week and just have retirement done so I think Most bills that were left could be done. Like maybe when city ready for being presented so we can either do an eight o'clock meeting Wednesday or we could do four o'clock Wednesday. pleasure of the Committee. Either one we know of budgets meeting in the morning and I don't know that so I tell you what all. Okay peer review so what we aim for. Four o'clock on Wednesday and just watch for your email in case there's a scheduling conflict and we'll we'll let you know that Sir Payton can follow up with his Senate members and all follow up with our house members but let's try to finish it this week. And then you won't have to show up on Monday morning. So in the lastly Senator Hammer sort of took my thunder but I want to personally say that this is I'm in my seventh year on retirement committee now five chairing this and it has been my distinct honor to work with Clint Rhoden one of the finest man I've a known in a while and every time I have gone to you with questions and I know that you've looked at me like this guy didn't get it but you've educated me through the years and help me understand retirement I am very grateful for the years that I've gotten to work with you we will miss having you here but thank you so much for your service to Arkansas teacher retirement system and to this committee and with that we are adjourned.