ARKANSAS TEACHER RETIREMENT SYSTEM - Executive Director Updates

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Executive Director Updates

8/17/2010 - Executive Director Update: Back to School and General Issues

All: Attached is an Executive Director Update that covers some general issues to consider as the new school year begins. ATRS looks forward to the school year and looks forward to serving the needs of ATRS employers, active members, and retirees. If ATRS can be of assistance to you, please contact ATRS.
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6/22/2010 - New retirees and general matters

Attached is an executive director update mainly focused on information for new retirees. However the update does have important general information on COLAs and interest rates. For all members following the markets, you already know what I am about to say. May and June have been difficult months in the markets. ATRS has lost a part of the gains made earlier this year. ATRS is still up well beyond the value it had last June 30th. With the 5 trading days left in this fiscal year after today, ATRS hopes for a positive bounce. ATRS is still worth over $10 billion dollars. ATRS is well positioned to take advantage of the markets once fundamental again become the predominant driver of market activity.

This is an executive director update on the 2010 retirement season deadlines and details with some general information that may be helpful. ATRS will be open on Memorial Day (May31st) to assist potential retirees for the 2010 retirement season. The detailed update on the 2010 retirement season is attached to this email. Please know that ATRS staff is always happy to give information to help you make decisions.

4/20/2010 - ATRS Board Elections 2010

ATRS is pleased to announce that two of the three open positions on the ATRS Board of Trustees are now filled after the recent elections. A runoff is scheduled in the final open position. First, Donna Morey, has been elected to the ATRS Board as an unopposed candidate. Donna Morey has been elected to Board Position #2. Board Position #2 is a certified teacher position representing the Second Congressional District.

As executive director at ATRS, I serve on the Arkansas Section 529 Plan Review Committee. The plan manages the college saving plan programs for Arkansas. Arkansas has one of the most respected 529 plans due to the ease of application, quality investment options, and special programs. As Arkansas residents, you have even more benefits than participants from out of state who use the Arkansas plan. Please consider using the plan's benefits to help a deserving student open the doors to post-secondary education.

Members nearing the end of T-Drop now have a new option to keep working after 10 years in T-Drop and have interest added each June 30th to their T-Drop balance. This provides a cost savings to ATRS and a new option for members for a win win outcome. This new policy will be used June 30th of this year and each year thereafter. The attached executive director update explains this policy in greater detail. The complete T-Drop rules with the post 10-year provision added is also attached to this email after the executive director update. This policy will be before the Joint Retirement Committee of the General Assembly next week for a final review.

I decided to send an Executive Director Update on the fast approaching ATRS Board elections. One reason for this Executive Director Update on Board elections is that the Election Policy recently changed and some changes included changes in dates affecting the election process. The three positions that are on the ballot for eligible ATRS votes are as follows:
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1/5/2010 - The Arkansas 529 Plan

I hope you will carefully examine the special opportunity the Arkansas 529 Plan provides to parents, grandparents, and friends of future college students and post-secondary school students. As ATRS Executive Director, I serve on the Arkansas 529 Committee. What I have learned in my service on the 529 Committee is that Arkansas has a user friendly and highly regarded 529 College Savings Plan. By the way, I have just finished my first year at ATRS and on the 529 Committee. The 529 plan has some important advantages over just trying to save for a child's education in a regular account.

ATRS has the final June 30, 2009 Actuarial Valuation of ATRS. An actuarial valuation provides insight into the financial soundness and stability of a retirement system.
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11/24/2009 General Update

This is an executive director update on ATRS and some general information that may be helpful. As I explained in the detailed update attached to this email, if you would like to see certain issues explained or discussed in a future executive director update, please send me an email on the issue/issues that you would like to have addressed.
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10/23/2009 More Statistics

This is an executive director update on ATRS and its operations. On June 30, 2009, ATRS had 70,645 active participants with their combined annual payroll of $2,317,662,755. The average age of the group was 44.7 years of age with an average service of 9.5 years. ATRS had 28,524 retirees, option beneficiaries, and survivors with combined annual benefits of 558,565,591. Their average age of the retirees was 69.2 years of age with an average benefit of $19,582.

10/2/2009 2008 Audit Responses

Through this Executive Director Update, ATRS is providing a copy of the 2008 audit findings for the period ending June 30, 2008 that were released early by Legislative Audit on September 21st. The Legislative Joint Auditing Committee will hear the ATRS audit report next week at the regularly scheduled Legislative Joint Audit Committee on October 8th.
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9/2/2009 ATRS Statistical Information

The Joint Retirement Committee of the Arkansas General Assembly met yesterday. The legislators focused on the status of the state retirement systems. I thought members might find the information compiled by ATRS staff for the Joint Retirement Committee helpful and of interest. For your use and review, the information presented to the Joint Retirement Committee is attached to this email. Some information is also listed by county to give members a snapshot of the impact of ATRS in their home county.

First this Executive Director Update is intended to be informational for members who are reviewing the Earnings Limitations and want more information. Prior to July 1, 2009, ATRS had applied an Earnings Limitation for decades. The Earnings Limitation was repealed effective July 1, 2009. Earnings Limitation obligations owed to ATRS for service before July 1, 2009, remains due and payable. The Earnings Limitation was intended to encourage ATRS members to remain active members until they were certain they intended to retire. By having members retire when they plan to no longer work, the System saved money by not paying retirement benefits earlier than the member’s actual retirement.

This is an Executive Director's update to answer concerns for members who have recently retired. ATRS wants to provide and restate information for members who are uncertain about whether they complied with the rules regarding the termination requirements. I have learned that some employees are very concerned about having met the separation requirements of ATRS. ATRS wants to answer questions and resolve the issues as quickly as possible and provide information about the specific requirements.

8/6/2009 ATRS Activities

The summer is always a busy time at ATRS. The end of the school year retirements and entry into T-DROP always loads ATRS staff with member counseling, paperwork, calculations, and double-checking applications. In addition, July 1st is the beginning of a new fiscal year and the close out of an old fiscal year. Accounting and investment staff must work hard to close the old books and begin fresh on new year financials. This summer is also a time to implement new laws from the 2009 session of the General Assembly. Many forms must be changed to reflect the changes from the old law. New forms have been created. Ensuring that the process and forms properly implements the law and policy is a major undertaking. After that, ATRS staff has to ensure a uniform explanation of the law reaches ATRS members.

This is an Executive Director’s update with some additional end of the fiscal year information.
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6/26/2009 Retirement numbers & repeal of the earnings limitation

This is an Executive Director’s update with some end of the fiscal year information. I will have another update early next week on some additional issues. The matters in this Executive Director update include 1) a brief update the number of July 1st retirements, and 2) elimination of the earnings limitation.
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5/22/2009 Compound COLA is now official

The Compound Cost Of Living Adjustment “COLA” to be applied to retirees’ benefits on July 1, 2009, is now official! The ATRS Board Resolution received its final approval in the Rules and Regulations Committee of Legislative Council on May 22, 2009. The Compound COLA will increase each retired member's base upon which the 3% COLA is calculated and applied (if the member has been retired for at least one year). Based upon the latest information, the additional payment to retirees will be over $19 million ($19,000,000) in the fiscal year that begins July 1, 2009, and ends June 30, 2010.

The IRS recently required ATRS to adjust its income tax withholding on our retirees' monthly benefits. ATRS changed the withholding amount for retirees' benefits beginning with the March 31, 2009 monthly benefit payment. The change essentially increased the monthly payment that retirees receive from ATRS. The change was caused by an act of Congress called the American Recovery and Reinvestment Act. The act was intended to stimulate the economy by providing more immediate money in payroll checks for workers earning income. At the end of this calendar year, when citizens file their income taxes, they were to receive an earned income tax credit equal to the additional money in their paycheck. They would receive more immediate money now and not have increased taxes due to the withholding change tied to the tax credit in this calendar year.

ATRS staff has learned that some school districts are considering the adoption of local policies on Act 743, the separation from employment law just enacted. The attached update addresses confusion some have expressed about Act 743. This update includes a caution about implementing local policy on Act 743. A truism on Act 743 is the following: The bottom line is that all members who are not 65 years of age have a separation period. Please carefully review the attached update before you adopt and implement a local policy on Act 743.

4/22/2009 - Board Elections

The ATRS Board election results have been delivered to ATRS. Three positions were up for election and all were contested elections. The winners of the ATRS election are as follows:

Position 6, Administrator's position: Jeff Stubblefield. Mr. Stubblefield is the superintendent of Charleston Public Schools. Mr. Stubblefield will begin service July 1, 2009, and was elected to serve a 6 year term.

Position 7, Nonlicensed position: David Cauldwell. Mr. Cauldwell is the business manager for Rogers Public Schools. Mr. Cauldwell will begin service July 1, 2009, and was elected to serve a 6 year term.

Position 8, Minority position: Hazel Coleman. Ms. Coleman is a retiree with 12 years experience on the ATRS Board. Ms. Coleman will continue service on the Board with a new 6 year term that begins on July 1, 2009.

The 87th General Assembly has completed the regular session of 2009. ATRS had several bills of interest and impact to members, both active and retired. ATRS appreciates all the support from members of the General Assembly in acting on the needs of ATRS members. The Joint Retirement Committee was focused and fair in its approach to retirement legislation.
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4/08/2009 - Executive Director Update Act 743 (SB165)

Attached is a very important update on Act 743 which many may know as SB165. This update has very important information for both employers and members to consider. ATRS will require certification under oath that the member's retirement is real without a plan of reemployment when retirement occurs.
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4/01/2009 - SB165 is now law

SB165 is now law. Governor Beebe signed SB165 today making it Act 743 of 2009. Again, I would like to thank all the members who made Act 743 possible. Act 743 was necessary to allow ATRS comply with Internal Revenue Service regulations. Act 743 provides members options that in the past may not have existed.
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3/30/2009 - SB165 Is Headed To The Governor

SB165 passed the House this afternoon by a vote of 92 for and 1 against. The bill is in enrolling by the Senate for delivery to Governor Beebe. ATRS does not expect any concern about SB165 from Governor Beebe. ATRS staff appreciates all the assistance from everyone that made the passage of SB165 possible. Without the help of so many members, this bill would not have passed the Senate and House. The ATRS Board worked hard to ensure ATRS complies with the Internal Revenue Service regulations to protect members. ATRS staff will continue to keep members updated as ATRS implements the provisions of SB165. Again thank you to the members for your assistance!

I was hopeful that the most watched ATRS bill, SB 165, would be acted on before the next Executive Director Update. However, the volume of bills going through the General Assembly has delayed the final legislative action on SB 165 a few days. Hopefully, SB 165's final vote in the House will come soon.
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3/12/2009 - SUMMARY OF ATRS RETIREMENT LEGISLATION

Attached is an Executive Director update on the core legislation that ATRS has developed this session. The list is in numerical order and includes the sponsor, status, and a brief explanation about each bill. I thought this might be helpful as you keep track of the ATRS package.
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3/9/2009 - Frequently Asked Questions on SB 165

There have been several questions on Senate Bill 165. This update contains the answers to these frequently asked questions.
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3/6/2009 - IMPORTANT UPDATE ON SB 165

This is another update on Senate Bill 165. This update addresses the federal mandate that requires ATRS to establish a longer separation period as established in SB 165. Without a change in the separation period from the current 30 days to a separation period that complies with federal law, then ATRS will fail to comply with federal pension law mandates. Failure to comply with the mandates will authorize the Internal Revenue Service to remove the tax qualified status that ATRS has always enjoyed. The loss of tax qualified status will have devastating impacts on members and employers of ATRS.