Bill Text: AZ HB2839 | 2024 | Fifty-sixth Legislature 2nd Regular | Introduced
Bill Title: Individual savings plan program; appropriation
Spectrum: Partisan Bill (Democrat 16-0)
Status: (Introduced - Dead) 2024-02-08 - House read second time [HB2839 Detail]
Download: Arizona-2024-HB2839-Introduced.html
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REFERENCE TITLE: individual savings plan program; appropriation |
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State of Arizona House of Representatives Fifty-sixth Legislature Second Regular Session 2024
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HB 2839 |
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Introduced by Representatives Austin: Aguilar, Contreras L, Contreras P, De Los Santos, Gutierrez, Hernandez C, Ortiz, Peshlakai, Quiñonez, Sandoval, Schwiebert, Seaman, Stahl Hamilton, Tsosie, Villegas
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An Act
amending title 38, Arizona Revised Statutes, by adding chapter 9; appropriating monies; relating to retirement.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 38, Arizona Revised Statutes, is amended by adding chapter 9, to read:
CHAPTER 9
ARIZONA RETIREMENT SAVINGS BOARD
ARTICLE 1. GENERAL PROVISIONS
38-1201. Definitions
In this chapter, unless the context otherwise requires:
1. "Board" means the Arizona retirement savings board.
2. "Covered Employee":
(a) Means an individual who is employed by a covered employer, who has wages or other compensation that is allocable to this State and who is at least eighteen years of age.
(b) does not include:
(i) Any employee who is covered under the Railway Labor Act (44 Stat. 577; 45 United States code section 151).
(ii) Any employee on whose behalf an employer makes contributions to a Taft-Hartley multiemployer pension trust fund.
(iii) Any individual who is an employee of the federal government, this state or any other state, any county or municipal corporation or any of this state's, any other state's or the federal government's units or instrumentalities.
3. "Covered employer":
(a) Means a person or entity that is engaged in a business, industry, profession, trade or other enterprise in this state, whether for profit or not for profit.
(b) Does not include:
(i) the federal government, this state, any county, any municipal corporation or any of this state's units or instrumentalities.
(ii) An employer that maintains a specified tax-favored retirement plan for its employees or has done so effective in form and operation at any time within the current or two preceding calendar years.
(iii) For the portion of the calendar year in which the employer adopts a tax-favored retirement plan, an employer that does not maintain a specified tax-favored retirement plan for a portion of a calendar year ending on or after the effective date of this section and adopts a tax-favored retirement plan effective for the remainder of that calendar year.
4. "ERISA" means the employee retirement income security act of 1974.
5. "Fund" means the Arizona retirement savings program fund established by section 38-1211.
6. "IRA" means a traditional or roth individual retirement account or individual retirement annuity under 26 United States Code section 408(a), 408(b) or 408A.
7. "Participant" means an individual who is contributing to an IRA under the program or has an IRA account balance under the program.
8. "payroll deduction IRA" means an arrangement by which an employer allows employees to contribute to an IRA by means of payroll deduction.
9. "Program" means the Arizona retirement savings program established by this article.
10. "Retirement system" means the ARizona state retirement system established in chapter 5, article 2 of this title.
11. "Roth IRA" means a roth individual retirement account or individual retirement annuity under 26 United States code section 408A.
12. "Specified tax-favored retirement plan" means a retirement plan that is tax-qualified under or is described in and satisfies the requirements of 26 United States Code section 401(a), 401(k), 403(a), 403(b), 408(k), 408(p) or 457(b) without regard to whether it constitutes an employee benefit plan under ERISA.
13. "Traditional IRA" means a traditional individual retirement account or traditional individual retirement annuity under 26 United States code section 408(a) or 408(b).
14. "Wages" means any compensation within the meaning of 26 United States code section 219(f)(1) that is received by an employee from an employer during a calendar year.
38-1202. Board; members; appointment; terms; reimbursement
A. The ARizona retirement savings board is established to develop and maintain the Arizona retirement savings program for individuals who are employed or self-employed for wages or other compensation in this state. The board consists of the state treasurer or the state treasurer's designee and eight members appointed by the governor who have experience with retirement plans, financial security or employee and employer issues.
B. The term of office of each member of the board appointed by the governor is four years. A member is eligible for reappointment. If there is a vacancy for any reason for a member appointed by the governor, the governor shall make a member appointment that is immediately effective for the remainder of the unexpired term. The members of the board shall elect one of its members annually to serve as chairperson.
C. A majority of the voting members of the board constitutes a quorum for the transaction of business.
D. Appointed members of the board are not eligible for compensation but are eligible to receive reimbursement of expenses pursuant to chapter 4, article 2 of this title.
E. Except as otherwise provided, the state treasurer's offices shall provide support staff to the board. The board shall reimburse the state treasurer's office for the full cost of any staff time provided to the board.
F. The first meeting of the board shall be not later than May 1, 2025.
38-1203. Duties of the board; requirement of the program
The board shall:
1. Conduct market, legal and feasibility analyses if the board considers them advisable.
2. Adopt rules the board considers necessary or advisable for the implementation and general administration and operation of the program as provided in section 38-1204, consistent with the internal revenue code and regulations under the internal revenue code, including to ensure that the program satisfies all criteria for favorable federal tax treatment and complies, to the extent necessary, with any other applicable federal or state law.
3. Use private sector partnerships to contract with a program administrator to administer the program and manage the investments under the supervision and guidance of the board in accordance with this chapter.
4. Cause funds to be held and invested and reinvested under the program.
5. Develop and implement an investment policy that defines the program's investment objectives consistent with the objectives of the program and that provides for policies and procedures consistent with those investment objectives. The board shall strive to select and offer investment options available to participants and other program features that are intended to achieve maximum possible income replacement balanced with an appropriate level of risk in an IRA-based environment consistent with the investment objectives under the policy. The investment options may encompass a range of risk and return opportunities and allow for a rate of return commensurate with an appropriate level of risk in view of the investment objectives under the policy. The menu of investment options must be determined by considering the nature and objectives of the program, the desirability based on behavioral research findings of limiting investment options under the program to a reasonable number and the extensive investment options available to participants in the event that they roll over funds in an IRA established under the program to an IRA outside the program. In accordance with paragraphs 11 and 15 of this subsection, the board, in carrying out its responsibilities and exercising its powers under this chapter, shall employ or retain appropriate entities or personnel to assist or advise the board and to whom to delegate the carrying out of such responsibilities and exercise of such powers.
6. Arrange for collective, common and pooled investment of assets of the program and fund, including investments in conjunction with other funds with which these assets are allowed to be collectively invested, with a view to saving costs through efficiencies and economies of scale.
7. Cause the program, the fund and the arrangements and accounts established under the program to be designed, established and operated consistent with all of the following:
(a) In accordance with best practices for retirement savings accounts.
(b) To encourage participation and saving and to make it simple, easy and convenient for participants to contribute and manage their savings.
(c) To promote sound investment practices and appropriate investment menus and default investments.
(d) To maximize simplicity and ease of administration for covered employers.
(e) To minimize costs, including by collective investment and economies of scale.
(f) To promote portability of benefits.
(g) To avoid preemption of the program by federal law.
8. Educate participants and potential participants on the benefits of planning and saving for retirement, help them decide the level of participation and saving strategies that may be appropriate for them and help them develop greater financial capability and financial literacy, including through partnerships with organizations based in this state specializing in financial literacy education.
9. In accordance with rules adopted by the board, determine the eligibility of an employer, employee or other individual to participate in the program, including conditions under which an employer that terminates the offering of a specified tax-favored retirement plan can become a covered employer eligible to participate in the program.
10. Arrange for and facilitate compliance by the program or arrangements established under the program with all requirements applicable to the program under the internal revenue code, including requirements for favorable tax treatment of the IRAs, and any other applicable federal or state law or accounting requirements, including using its best efforts to implement procedures minimizing the risk that covered employees will exceed the limits on tax-favored IRA contributions that they are eligible to make and otherwise providing or arranging for assistance to covered employers and covered employees in complying with applicable law and tax-related requirements in a cost effective manner. The board may establish any processes it reasonably considers to be necessary or advisable to verify whether an employer is a covered employer, including reference to online data and possible use of questions in employer state tax filings, consistent with the objective of avoiding to the fullest extent practicable any need to require employers that are not covered employers to register with the program or take other action to demonstrate that they maintain specified tax-favored retirement plans or are exempt for other reasons from being treated as covered employers.
11. Employ or otherwise retain a program administrator, an executive director, staff, a trustee, a record keeper, investment managers, investment advisors, other administrative, professional and expert advisors and service providers, none of whom may be members of the board and all of whom serve at the pleasure of the board, and the board shall determine their duties and compensation. The board may authorize the executive director employed by the board to enter into contracts, as described in paragraph 15 of this subsection, on behalf of the board or conduct any business necessary for the efficient operation of the board.
12. Discharge its duties and ensure that the members of the board discharge their duties with respect to the program solely in the interest of the participants as follows:
(a) For the exclusive purpose of providing benefits to participants and defraying reasonable expenses of administering the program.
(b) With the care, skill, prudence and diligence under the circumstances then prevailing that persons of prudence, discretion and intelligence, acting in a like capacity and familiar with those matters, would use in the conduct of an enterprise of a like character and with like aims.
13. Make provision for costs and expenses incurred to initiate, implement, maintain, manage and administer the program and its investments to be paid or defrayed from investment returns or assets of the program or from the charging and collection of other fees, charges or funds, whether account-based, asset-based, per capita or otherwise, by or for the program or pursuant to arrangements established under the program to the extent allowed under federal and state law.
14. Accept any grants, gifts, legislative appropriation, loans and other funds from this state, any unit of federal, state or local government or any other person, firm or entity to defray the costs of administering and operating the program in accordance with the requirements of this chapter.
15. Make and enter into contracts, agreements or arrangements for and collaborate and cooperate with and retain, employ and contract with or for any of the following to the extent the board considers necessary or advisable for the effective and efficient design, implementation and administration of the program consistent with the purposes set forth in this chapter and to maximize outreach to covered employers and covered employees:
(a) Services of private and public financial institutions, depositories, consultants, actuaries, counsel, auditors, investment advisors, investment administrators, investment management firms, other investment firms, third-party administrators, other professionals and service providers, the retirement system, the state treasurer's office, other state treasurers and other state public retirement systems.
(b) Research, technical, financial, administrative and other services.
(c) Services of other state agencies and instrumentalities, including those with responsibilities for tax collection, budget, finance, labor and employment regulation, consumer protection, business regulation and liaison, benefits and public assistance, to assist the board in the exercise of its powers and duties, and all such agencies and instrumentalities shall provide such assistance at the board's request.
(d) Services to develop and implement outreach efforts to gain input and disseminate information regarding the program and retirement saving in general, including timely information to covered employers regarding the program and how it applies to them, with special emphasis on their ability at any time to sponsor a specified tax-favored retirement plan that would exempt them from any responsibilities under the program.
16. Ensure that all contributions to an IRA under the program are used only to pay benefits to participants under the program, pay the cost of administering the program or make investments for the benefit of the program and that no assets of the program or fund are transferred to the state general fund or to any other fund of this state or are otherwise encumbered or used for any other purpose.
17. Consider whether procedures should be adopted to allow employers that are not covered employers because they are exempt from covered employer status to voluntarily participate in the program by automatically enrolling their employees, considering, among other factors, the potential legal consequences and the degree of employer demand to participate or facilitate participation by employees.
18. Evaluate the need for, and procure if and as considered necessary, insurance against any loss in connection with the property, assets or activities of the program, including, if and as considered necessary, pooled private insurance.
19. Indemnify, including procurement of insurance if and as needed for this purpose, each member of the board from personal loss or liability resulting from a member's action or inaction as a member of the board.
20. Collaborate with, and evaluate the role of, financial advisors or other financial professionals, including in assisting and providing guidance for covered employees.
21. Along with its members, the program administrator and other staff of the board, comply with any applicable state ethics and gift laws, procurement codes and restrictions and restrictions on honoraria and may not do any of the following:
(a) Directly or indirectly have any interest in the making of any investment under the program or in gains or profits accruing from any such investment.
(b) Borrow any program-related funds or deposits, or use any such funds or deposits in any manner, for the benefit of the board or any member or as an agent or partner of others.
(c) Become an endorser, surety or obligor on investments made under the program.
22. Carry out its powers and duties under the program pursuant to this chapter and exercise any other powers as are appropriate for the effectuation of the purposes, objectives and provisions of this chapter pertaining to the program.
38-1204. Required elements of the program; implementation
A. Consistent with the implementation dates in subsection B of this section, the program shall:
1. Allow an eligible individual in this State to choose whether to contribute to an IRA under the program, including allowing a covered employee in this state the choice to contribute to an IRA under the program through a payroll deduction IRA arrangement.
2. Notwithstanding any provision of state law related to payroll deduction, require each covered employer to offer its covered employees the choice whether to contribute to a payroll deduction IRA by automatically enrolling them in the payroll deduction IRA with the opportunity to opt out. A covered employee who is not a participant because that employee has opted out will be automatically reenrolled with the opportunity to opt out again at regular or ad hoc intervals determined by the board in its discretion, but not more frequently than annually.
3. Provide that the IRA to which contributions are made is a Roth IRA, except that the board has the authority at any time, in its discretion, to add an option for all participants to affirmatively elect to contribute to a traditional IRA as an alternative to the Roth IRA.
4. Provide that, unless otherwise specified by the covered employee, a covered employee must automatically initially contribute five percent of the covered employee's salary or wages to the program and may elect to opt out of the program at any time or contribute at any higher or lower rate, expressed as a percentage of salary or wages or, if the board in its discretion allows, expressed as a flat dollar amount, subject in all cases to the IRA contribution and income eligibility limits applicable under the internal revenue code at no additional charge. The board is authorized to change, from time to time, the five percent automatic initial default contribution rate for all covered employees in its discretion.
5. Provide on a uniform basis, if and when the board so determines in its discretion, for an annual increase of each participant's contribution rate, by not more than one percent of salary or wages per year up to a maximum of eight percent. Any such increases must apply to participants, as determined by the board in its discretion, either by default or only if initiated by affirmative participant election and are in either case subject to the IRA contribution and income eligibility limits applicable under the internal revenue code.
6. Provide for direct deposit of contributions into investments under the program, including a default investment such as a series of target date funds and a limited number of investment alternatives, including a principal preservation option determined by the board. In addition, the board may provide that each participant's initial contributions, up to a specified dollar amount or for a specified period of time, are required to be invested in a principal preservation investment or, in the board's discretion, must be defaulted into such an investment unless the participant affirmatively opts for a different investment for those contributions. The board shall determine how often participants will have the opportunity to change their selections of investments for future contributions or existing balances or both.
7. Provide that employer contributions by a covered employer are not required or allowed.
8. Be professionally managed.
9. When possible and practicable, use existing employer and public infrastructure to facilitate contributions, record keeping and outreach and use pooled or collective investment arrangements for amounts contributed to the program.
10. Require the maintenance of separate records and accounting for each account under the program and allow for participants to maintain their accounts regardless of place of employment and to roll over funds into other IRAs or other retirement accounts.
11. Provide for reports on the status of each participant's account to be provided to each participant at least annually and make best efforts to provide each participant frequent or continual online access to information on the status of that participant's account.
12. Provide that each participant owns the contributions to and earnings on amounts contributed to the participant's account under the program and that this state and covered employers have no proprietary interest in those contributions or earnings.
13. Be designed and implemented in a manner consistent with federal law to the extent that it applies and is consistent with the program not being preempted by and the payroll deduction IRAs and covered employers not being subject to ERISA.
14. Promote expanded retirement saving by encouraging employers in this state that would otherwise be covered employers to instead adopt a specified tax-favored retirement plan.
15. Make provision for participation in the program by individuals who are not employees, such as self-employed individuals and independent contractors, as provided in rules adopted pursuant to section 38-1207.
16. Seek to keep fees, costs and expenses of the program as low as practicable, except that any administrative fee imposed on a covered employee for participating in the program should be similar to established programs in other states. The fee may be an asset-based or investment return fee, flat fee or hybrid of the permissible fee structures identified in this paragraph.
17. Adopt rules and establish procedures governing the distribution of monies from the program, including such distributions as may be allowed or required by the program and any applicable provisions of tax laws, with the objectives of maximizing financial security in retirement, helping to protect spousal rights and assisting participants with the challenges of decumulation of savings. The board has the authority to provide for one or more reasonably priced distribution options to provide a source of regular retirement income, including income for life or for the participant's life expectancy or for joint lives and life expectancies, as applicable.
18. Adopt rules and establish procedures promoting portability of benefits, including the ability to make tax-free rollovers or transfers from IRAs under the program to other IRAs or to tax-qualified plans that accept such rollovers or transfers.
19. Establish penalties in accordance with section 38-1205 for a covered employer that fails without reasonable cause to enroll a covered employee in the program as required or that fails to transmit a payroll deduction IRA contribution to the program as required.
20. In accordance with section 38-1203, paragraph 3, use private sector entities to administer the program and invest the contributions to the program under the supervision and guidance of the board.
21. Allow the board to provide for the establishment, maintenance, administration, operation and implementation of the program to be carried out jointly with, or in partnership, collaboration, coordination or alliance with one or more other states, the federal government or any federal, state or local agencies or instrumentalities.
B. The board shall implement the program as follows:
1. Beginning April 1, 2026, the board shall require a covered employer with twenty-five or more covered employees to offer the program to its covered employees.
2. Beginning October 1, 2026, the board shall require a covered employer with fifteen to twenty-four covered employees to offer the program to its covered employees.
3. Beginning April 1, 2027, the board shall require a covered employer with one to fourteen covered employees to offer the program to its covered employees.
C. Notwithstanding subsection B of this section, a covered employer may voluntarily offer the program to its covered employees on or after April 1, 2026.
38-1205. Penalties
A. If a covered employer fails to enroll a covered employee without reasonable cause, the covered employer is subject to a penalty for each covered employee for each calendar year or portion of a calendar year during which the covered employee was not enrolled in the program or had not opted out of participating in the program and, for each calendar year beginning after the date on which a penalty has been assessed with respect to a covered employee, is subject to a penalty for any portion of that calendar year during which the covered employee continues to be unenrolled without opting out of participating in the program. The amount of any penalty imposed on a covered employer for the failure to enroll a covered employee without reasonable cause is determined as follows:
1. Before April 1, 2027, the maximum penalty per covered employee is $10.
2. Beginning April 1, 2027 to March 31, 2028, the maximum penalty per covered employee is $20.
3. Beginning April 1, 2028 to September 30, 2029, the maximum penalty per covered employee is $50.
4. On or after October 1, 2029, the maximum penalty per covered employee is $100.
B. A penalty may not be imposed on a covered employer for any failure to enroll a covered employee for which it is established that the covered employer did not know that the failure existed and exercised reasonable diligence to meet the requirements of this chapter.
C. A penalty may not be imposed on a covered employer for any failure to enroll a covered employee if the covered employer exercised reasonable diligence to meet the requirements of this chapter and the covered employer complies with those requirements with respect to each covered employee by the end of the ninety-day period beginning on the first date the covered employer knew, or exercising reasonable diligence would have known, that the failure existed.
D. In the case of a failure that is due to reasonable cause and not to wilful neglect, all or part of the penalty may be waived to the extent that the payment of the penalty would be excessive or otherwise inequitable relative to the failure involved.
E. If a covered employer fails to remit a payroll deduction contribution to the program on the earliest date the amount withheld from the covered employee's compensation can reasonably be segregated from the covered employer's assets, but not later than the fifteenth day of the month following the month in which the covered employee's contribution amounts are withheld from the covered employee's paycheck, the failure to remit the contribution on a timely basis is subject to the same penalties that apply to employer misappropriation of employee wage withholdings and to the penalties specified in subsection A of this section.
F. The attorney general shall represent the board in enforcement and collection of penalties.
38-1206. Rules
The board shall adopt rules to do all of the following:
1. Establish the processes for enrollment and contributions to an IRA under the program, notwithstanding any provision of state law related to payroll deductions to the contrary, including withholding by covered employers of employee payroll deduction contributions from wages and remittance for deposit to an IRA, automatic enrollment in a payroll deduction IRA and opt-outs by covered employees, voluntary contributions by others, including self-employed individuals and independent contractors, through payroll deduction or otherwise, the making of default contributions using default investments and participant selection of alternative contribution rates or amounts and alternative investments from among the options offered under the program.
2. Establish the processes for withdrawals, rollovers and direct transfers from an IRA under the program in the interest of facilitating portability of benefits.
3. Establish processes for phasing in enrollment of eligible individuals, including phasing in enrollment of covered employees by size or type of covered employer in the provisions of this chapter.
4. Establish requirements for the determination of whether a part-time, seasonal or temporary employee is a covered employee eligible to participate in the program.
5. Establish a process for a participant to make nonpayroll contributions to accounts under the program.
6. Establish a process for an employer to be determined to be exempt from the program because the employer sponsors a specified tax-favored retirement plan.
7. Conduct outreach to individuals, employers, other stakeholders and the public regarding the program, including specifying the contents, frequency, timing and means of required disclosures from the program to covered employees, participants, other individuals eligible to participate in the program, covered employers and other interested parties. These disclosures must include the following:
(a) The benefits and risks associated with tax-favored retirement savings under the program.
(b) The potential advantages and disadvantages associated with contributing to a Roth IRA and, if applicable, a traditional IRA under the program.
(c) The eligibility rules for a Roth IRA and, if applicable, a traditional IRA.
(d) That the individual and not the employer, this State, the board, any board member or other state official or the program is solely responsible for determining whether, and, if so, how much, the individual is eligible to contribute on a tax-favored basis to an IRA.
(e) The penalty for excess contributions to an IRA and the method of correcting excess contributions.
(f) Instructions for enrolling, opting out of participation, making contributions and making withdrawals, including the possibility of contributing to an IRA, whether offered under the program or not, by means other than automatic enrollment in a payroll deduction IRA.
(g) Instructions for opting out of each of the Roth IRA, the default contribution rate and the default investment if the covered employee prefers a traditional IRA, including the possibility of contributing to a traditional IRA, if offered as an option under the program, a higher or lower contribution rate or different investment alternatives.
(h) The potential availability of a saver's tax credit, including the eligibility conditions for the credit and instructions on how to claim the credit.
(i) That employees seeking tax, investment or other financial advice should contact appropriate professional advisors and that covered employers are not in a position to provide such advice and are not liable for decisions individuals make in relation to the program.
(j) That the payroll deduction IRA is not intended to be an employer-sponsored retirement plan and that the program is not an employer-sponsored retirement plan.
(k) The potential implications of account balances under the program for the application of asset limits under certain public assistance programs.
(l) That the participant is solely responsible for investment performance, including market gains and losses, and that IRAs and rates of return are not guaranteed by any employer, this State, the board, any board member or state official or the program.
(m) Additional information about retirement and saving and other information designed to promote financial literacy and capability, which may take the form of links to, or explanations of how to obtain, such information.
(n) How to obtain additional information about the program.
38-1207. Employer protection from liability
A. A covered employer or other employer is not liable for or does not bear responsibility for:
1. An employee's decision whether to participate in the program or a participant's specific elections under the program.
2. A participant's or the board's investment decisions.
3. The administration, investment, investment returns or investment performance of the program, including any interest rate or other rate of return on any contribution or account balance if the employer does not play a role.
4. The program design or the benefits paid to participants.
5. An individual's awareness of or compliance with the conditions and other provisions of the tax laws that determine which individuals are eligible to make tax-favored contributions to IRAs, in what amount and in what time frame and manner.
6. Any loss, failure to realize any gain or any other adverse consequences, including any adverse tax consequences or loss of favorable tax treatment, public assistance or other benefits incurred by any person who participates in the program.
B. A covered employer or other employer is not, and is not considered to be, a fiduciary in relation to the program or fund or any other arrangement under the program.
38-1208. Protection from liability
A. This state, the board, each member of the board or other state official, other state boards, commissions or agencies, or any member, officer or employee thereof and the program:
1. Have no responsibility for individuals to comply with the conditions and other provisions of the internal revenue code that determine which individuals are eligible to make tax-favored contributions to IRAs, in what amount and in what time frame and manner.
2. Have no duty, responsibility or liability to any party for the payment of any benefits under the program, regardless of whether sufficient monies are available under the program to pay those benefits.
3. Do not and may not guarantee any interest rate or other rate of return on or investment performance of any contribution or account balance.
4. Are not and may not be liable or responsible for any loss, deficiency, failure to realize any gain or any other adverse consequences, including any adverse tax consequences or loss of favorable tax treatment, public assistance or other benefits, incurred by any person as a result of participating in the program.
B. The debts, contracts and obligations of the program or the board are not the debts, contracts and obligations of this state, and neither the faith and credit nor the taxing power of this state is pledged directly or indirectly to the payment of the debts, contracts and obligations of the program or the board.
38-1209. Confidentiality
Individual account information relating to accounts under the program and relating to individual participants, including names, addresses, telephone numbers, email addresses, personal identification information, investments, contributions and earnings, is confidential and must be maintained as confidential:
1. Except to the extent necessary to administer the program in a manner consistent with this chapter, the tax laws of this state and the internal revenue code.
2. Unless the individual who provides the information or who is the subject of the information expressly agrees in writing to the information disclosure.
38-1210. Intergovernmental agreement and memorandum of understanding
The board may enter into an intergovernmental agreement or memorandum of understanding with this state and any agency of this state to receive outreach, technical assistance, enforcement and compliance services, collection or dissemination of information pertinent to the Program, subject to the obligations of confidentiality as may be agreed or required by law, or other services or assistance. This state and any agencies of this state that enter into an agreement or memorandum of understanding shall collaborate to provide the outreach, assistance, information and compliance or other services or assistance to the board. The memorandum of understanding may cover the sharing of costs incurred in gathering and disseminating information and the reimbursement of costs for any enforcement activities or assistance.
38-1211. Arizona retirement savings program fund
A. The Arizona retirement savings program fund is established consisting of legislative appropriations and gifts, grants and donations. the board shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190, relating to lapsing of appropriations.
B. The board may use the monies in the fund only to pay the administrative costs and expenses of the program and the administrative costs and expenses the board incurs in the performance of its duties under this chapter.
38-1212. Audit; report
A. The board shall cause an accurate account of all of the program's, fund's and board's activities, operations, receipts and expenditures to be maintained on a calendar year basis. A full audit of the books and accounts of the board pertaining to those activities, operations, receipts and expenditures must be conducted by a certified public accountant, including direct and indirect costs attributable to the use of outside consultants, independent contractors and any other persons who are not state employees for the administration of the program. For the purposes of the audit, the auditors must have access to the properties and records of the program and board and may prescribe methods of accounting and the rendering of periodic reports in relation to projects undertaken by the program.
B. Beginning February 1, 2027 and annually thereafter, the board shall submit to the governor, the state treasurer, the president of the senate and the speaker of the house of representatives an audited financial report, prepared in accordance with generally accepted accounting principles, detailing the activities, operations, receipts and expenditures of the program and board during the preceding calendar year. The report must include the number of participants, the investment options and their rates of return and other information regarding the program and must also include projected activities of the program for the current calendar year. A copy of the report shall be submitted to the secretary of state.
Sec. 2. Appropriation; Arizona retirement savings board; Arizona retirement savings program; exemption
A. The sum of $1,600,000 is appropriated from the state general fund in fiscal year 2024-2025 to the Arizona retirement savings board for the purposes of title 38, chapter 9, Arizona Revised Statutes, as added by this act.
B. The appropriation made in subsection A of this section is exempt from the provisions of section 35-190, Arizona Revised Statutes, relating to lapsing of appropriations.
