- (a) Acts 2011, No. 979, added Arkansas Code § 24-11-214(l) which defines the percentage of the Arkansas Local Police and Fire Retirement System-only cost that premium tax is allocated to cover.
- (b) This section also states that during this transition period, the actuarial cost less the allocation amount may not increase in any one (1) year by more than one percent (1%) of payroll.
(c) The following steps will be used to accomplish this goal:
(1)
- (A) A location cost percentage will be determined for each location.
- (B) This amount will be the 2011 actuarial cost less the 2011 allocation of premium tax, all divided by the salary amount used in the 2011 allocation;
(2)
- (A) The location cost percentage will be based on the system-only paid service cost.
- (B) That is, the additional cost of the consolidated local plan will not be included;
(3)
- (A) For 2012 – 2015, a location cost percentage will be determined based on that year.
- (B) It will be compared to the 2011 location cost percentage;
(4)
- (A) If the location cost percentage for 2012 is more than one percent (1%) above the 2011 location cost percentage, the allocation will be increased until it is only one percent (1%) more.
- (B) The percentage for 2013 is two percent (2%), 2014 is three percent (3%), and 2015 is four percent (4%);
- (5) The increased allocation described in subdivision (c)(4) of this section will be funded by setting a minimum on the difference in the location cost percentage versus the previous year for all locations;
- (6) If there is not sufficient premium tax to accomplish the reallocation described in subdivision (c)(5) of this section, then the percentage in subdivision (c)(4) of this section will be increased to balance; and
- (7) Any location that adopts system coverage in 2011 or later is not subject to the transition period rules.