Lots of talk at the Capitol about legislation to extend the deferred retirement option (DROP) benefit for long-time state employees.

It is double-dipping, after a fashion. In the Arkansas Public Employees Retirement  System, people who’ve worked 28 years can enter the DROP program and begin amassing 63 percent of earned retirement benefits (75 percent for those with 30 or more years service) in an interest-paying account while continuing to work at full pay. Three percent COLAs on the DROP payment and the final retirement benefit continue. Teachers also have a DROP program. The DROP money is payable — lump sum, annuity or rollover — only after employment is terminated.


The law now limits DROP participation to seven years. HB 1281 would allow members of APERS to stay in DROP for 10 years. A similar bill was tried in 2019 but didn’t pass.

Rumors abound about who’s targeted by this bill. One of the reputed beneficiaries, nearing the end of his DROP period, with a staff wondering about the future, has not responded to my questions. One sponsor, Sen. Bill Sample, did respond.


He said the bill was not aimed at the employee I’d questioned. He said:

We have several key people that we are  about to lose because they are nearing the end of their DROP commitment.

We have to have people who have institutional knowledge and particular skills to do the job that we are elected to do.

He said the bill would have minimal, perhaps even positive revenue impact, “because the money that the employee pays in is invested and the rate of return to the employee is less than what the system’s return is.”


When people enter DROP they do so with an understanding that it is finite and that they lose their accrued retirement payments if they don’t terminate employment at the end of seven years.  This legislation provides three more years of dual payments. This will be a change, even if intended to benefit specific people this year, that will become a permanent fringe for long-time state employees.

This is the justifying language for an emergency clause.

It is found and determined by the General Assembly of the State of Arkansas that revisions and updates to the Arkansas Public Employees’ Retirement System are of great importance for actuarial purposes and to protect member benefits; that with the current coronavirus 2019 (COVID-19) pandemic, state government needs to retain experienced personnel in order to address needed procedures and potential budget issues while continuing to deliver services to the citizens of Arkansas; that passage of this act will permit the immediate continuation in service of the state’s experienced personnel; and that this act is necessary to maintain an orderly system of managing member benefits offered by the Arkansas Public Employees’ Retirement System.


Therefore, an emergency is declared to exist, and this act being necessary for the preservation of the public peace, health, and safety shall become effective on March 31, 2021.

People this valuable deserve public recognition, don’t you think?