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HB 1160

TO AMEND THE LAW CONCERNING PERMISSIVE SERVICE CREDIT FOR GAP YEAR SERVICE UNDER THE ARKANSAS TEACHER RETIREMENT SYSTEM; AND TO DECLARE AN EMERGENCY.

2025 Regular Session Introduced by Jim Dotson and 1 co-sponsor

Act 227 allows Arkansas teachers to purchase service credit for up to five gap years, enhancing retirement benefits for those who took time off from teaching.

Notification that HB1160 is now Act 227
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WeVote Research Nonpartisan
Bill Summary · HB 1160

Summary of House Bill 1160 (Act 227)

Purpose and Intent

House Bill 1160, now known as Act 227, aims to amend the Arkansas Teacher Retirement System (ATRS) regulations regarding permissive service credit for "gap year" service. The bill seeks to clarify and update the definition of "gap year" and the conditions under which teachers can purchase service credit for periods of inactivity. An emergency clause has been included to ensure timely implementation of these changes.

Key Provisions

The bill introduces several significant amendments to existing law:

Definition of "Gap Year"

  • The term "gap year" is redefined to "gap period," specifying it as a time frame of one-quarter (1/4) of a fiscal year during which a member:
    • Was inactive and either unemployed or not providing qualified service.

Permissive Service Credit

  • Members of the ATRS can purchase permissive service credit for one or more gap years if they meet the following criteria:

    1. Have at least five (5) years of actual service in the system.
    2. Left their teaching position immediately before each gap year.
    3. Accrued at least one-half (½) year of service credit after returning to teaching.
    4. Were inactive during the gap period.
    5. Are ineligible for free service credit under other provisions.

  • Each gap year can be purchased as one-quarter (1/4) year of service credit, with a maximum of five (5) years of permissive service credit purchasable.

Payment and Refunds

  • Members must pay the actuarial equivalent of their benefits for each quarter of permissive service credit purchased.
  • Refunds for payments made for permissive service credit are available if the member ceases to be active before the credit is established or if the credit is not used for retirement eligibility.

Affected Parties

This legislation primarily affects:
- Members of the Arkansas Teacher Retirement System, particularly those who have taken gap years from teaching.
- School districts and employers participating in the ATRS, as they will need to adjust their reporting and contribution requirements in line with the updated provisions.

Procedural Aspects

  • The bill was introduced on January 16, 2025, and passed through various legislative stages, including the adoption of the emergency clause.
  • It was officially enacted as Act 227 on February 27, 2025, with an effective date set for July 1, 2025, to align with the fiscal year of the ATRS.

Conclusion

House Bill 1160 (Act 227) represents a significant update to the Arkansas Teacher Retirement System, providing clearer guidelines for teachers regarding the purchase of service credit for gap years. The changes aim to enhance the system's efficiency and ensure that members can better navigate their retirement benefits.

Compiled from official sources — confirm details with the bill’s official record.

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