Arkansas

Overview

Two state retirement systems—the Arkansas Teachers Retirement System and the Arkansas Public Employees Retirement System—account for most public pension plan assets and participants in Arkansas. Other statewide systems include the Arkansas Local Police & Fire Retirement System and the Arkansas State Highways Employees Retirement System. Each system is responsible for managing its assets.

Arkansas TRS provides pension and other benefits to public school teachers and other employees of public educational institutions in the state.

Arkansas PERS administers pension and other benefits to nearly all public employees in the state except for teachers, highway employees, and local police officers & firefighters. Three boards oversee APERS: the Arkansas Public Employees’ Retirement System Board; the State Police Retirement System Board; and the Arkansas Judicial Employees’ Retirement System Board. The PERS board is responsible for investing assets of the State Police Trust Fund.

Plan Design

Defined benefit plans serve as the primary retirement benefit for substantially all public employees in Arkansas.

According to the US Government Accountability Office, 94 percent of employees of state and local government in Arkansas participate in Social Security.

Access plan design detail

Authorizing Statutes and Board Structure

Title 24 of the Arkansas Code authorizes and describes retirement systems in the state.

Arkansas TRS: The TRS board is made up of 15 members as described in Title 24-7.

Arkansas PERS: Nine members comprise the PERS board, as described in Title 24-4.

Details regarding the composition of these and other retirement boards is accessible via the Retirement and Investment Board Characteristics search tool located at the bottom of this page.

Fiduciary Duty/Prudence Standard

Arkansas Code § 24-2-611, titled Prudent Investor Rule, states:
Trustees shall invest and manage trust assets as a prudent investor would, by considering the purposes, terms, distribution requirements, and other circumstances of the trust. In satisfying this standard, the trustees shall exercise reasonable care, skill, and caution.

(b) The trustees' investment and management decisions respecting individual assets must be evaluated not in isolation but in the context of the trust portfolio as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the trust.

(c) Among circumstances that trustees shall consider in investing and managing trust assets are such of the following as are relevant to the trust or its beneficiaries:

(1) General economic conditions;

(2) The possible effect of inflation or deflation;

(3) The expected tax consequences of investment decisions or strategies;

(4) The role that each investment or course of action plays within the overall trust portfolio, which may include financial assets, interests in closely held enterprises, tangible and intangible personal property, and real property;

(5) The expected total return from income and the appreciation of capital;

(6) Other resources of the beneficiaries;

(7) Needs for liquidity, regularity of income, and preservation or appreciation of capital; and

(8) An asset's special relationship or special value, if any, to the purposes of the trust or to one (1) or more of the beneficiaries.

(d) Trustees shall make a reasonable effort to verify facts relevant to the investment and management of trust assets.

(e) Trustees may invest in any kind of property or type of investment consistent with the standards of this subchapter.

(f) Trustees who have special skills or expertise, or who are named trustees in reliance upon the trustees' representation that the trustees have special skills or expertise, have a duty to use their special skills or expertise.

Legal Protections of Retirement Benefits

No explicit constitutional protection for public pension benefits; courts provide limited protection for contributory vested pension benefits. See Jones v. Cheney, 489 S.W.2d 785 (1973) (holding that vested pension benefits funded with employee contributions are protected from impairment); compare Blackwood v. Floyd, 29 S.W.3d 691 (Ark. 2000) (holding that non-contributory pension benefits are a mere gratuity). (AR CONST., Article 2, §17) Source: Robert Klausner, Esq., State Constitutional Protections for Public Sector Retirement Benefits

More Data

Population (2024) 3,088,354

Arkansas public pension statistics, per U.S. Census Bureau as of FY 2024
Assets	$39.7 billion
Active Members	147,289
Annuitants	129,435
Benefits Paid	$2.6 billion
Employee Contributions	$401.7 million
Employer Contributions	$1.3 billion
Systems	Four state systems that together account for 99 percent of assets and 98 percent of public pension plan participants in the state. The Census Bureau also reports 61 local systems, which are predominantly small plans for firefighters.

Become A Member

Becoming a member of NASRA offers a unique opportunity to join a community committed to the sound, efficient, and innovative stewardship of public retirement systems. Membership connects you with a network of professionals and experts, providing valuable insights into managing public retirement systems with a focus on sustainability and risk-averse strategies.

By joining NASRA, you gain the tools and resources to enhance the management of public retirement systems, ensuring their long-term success and reliability for generations to come.

What's New at NASRA: Public Pension Investment Return Assumption Brief Updated

NASRA’s latest update to standing issue briefs, Public Pension Plan Investment Return Assumptions underscores the critical role the investment return assumption plays in the financial health of public pension plans. Of all actuarial assumptions, it has the greatest impact on plan funding levels and cost. This brief traces how a decade of low interest rates and inflation, beginning in 2009, prompted many plans to reduce their long-term expected returns in line with more modest capital market projections. However, since inflation began rising in early 2021, the trend toward lowering return assumptions has largely paused. While reducing a plan’s assumed return can increase both costs and unfunded liabilities, setting this assumption is a careful, thorough process. It draws on expert input from actuaries and investment professionals and is guided by actuarial standards of practice.

Retirement System Account Interest Policies	Economic Actuarial Assumptions	Retirement and Investment Board Characteristics
Information about interest rates applied to account balances of inactive plan participants	Assumed rates of investment return and inflation	Composition and characteristics of public retirement and investment oversight boards
Mortality Assumptions	Plan Design Features	Post-retirement Employment Policies
Public retirement system actuarial assumptions for mortality	Numerous elements of retirement plan design	Policies governing return-to-work for retirement system annuitants