Fidelity bond coverage requirements for Arkansas Public Employees Retirement System employees considering Act 793 of 1977 and Act 286 of 1985. Q1) Is the Arkansas Public Employees Retirement System still required to have $1,000,000 in total coverage? Q2) If so, should the State Risk Manager incre

STATE OF ARKANSAS OFFICE OF THE ATTORNEY GENERAL 201 EAST MARKHAM STREET df SS. , f+ (5. HERITAGE WEST BUILDING (504) 371-2007 STEVE CLARK ATTORNEY GENERAL LITTLE ROCK, ARKANSAS 72201 OPINION NO. 86~273 agit yr April 30, 1986 « Kie D. Hall, Executive Director Arkansas Public Employees Retirement System - One State Capitol Mall . Little Rock, AR - Dear Mr. Hall: This is in reponse to your request for a formal opinion regarding fidelity bond coverage requirements for Arkansas Public Employees Retirement System employees considering Act 793 of. 1977 and Act 286 of 1985, - Your questions are: . ; - 1. Is ‘the Arkansas Public Employees Retirement System still required to have $1,000,000 in total coverage? -~ - 2, If so, should the State Risk Manager increase that “coverage accordingly or should Arkansas Public Employees '.. Retirement System purchase additional coverage of «$700, 0002 . _ ‘Section 7. 05, “Act” “193 “of | "1977, Ark. Stat. Ann. §12-3307 .+ (7.05) ‘requires ‘that “the ‘respective retirement systems rovide a one million ‘dollar blanket fidelity bond covering vemployees and others. Administering the system's funds. ye - “Section 8, Act 286 ‘of 1985, ~ Ark, Stat. Ann. §12- 261 states. that the blanket bond(s) under Act 286 ".,, shall be in lieu’ of all statutory ‘required bonds...'' and the various laws providing for surety bonds shall not be applicable as long. ‘as the’ blanket bond is in effect. The officers | and. employees covered ‘by the blanket bond are elected ‘and “woo --—- appointed ~ salaried officials and salaried employees excluding appointed - members of boards and commissions, ‘Ark, Stat. ; -Ann. §12= 255. aon Kie D. Hall April 30, 1986 Page 2 Initially, it should be noted that the scope of Act 793 is broader than that of Act 286. The former requires coverage of any person administering system funds whether as an employee, officer or in some other capacity. For the officers and employees covered by Act 286, that bond substitutes for the Act 793 bond because of the clear, unambiguous language of Ark. Stat. Ann. §12-261. However, the system would also be required to maintain its own Act 793 bond for those persons not covered by the Act 286 bond who administer system funds. Pursuant to Act 286, the State Risk Manager is authorized to obtain a blanket bond(s) for $300,000 coverage. Purchase of coverage in excess of that amount is beyond the authority of the Risk Manager and must be paid for by the system under §12- 3307(7. 05). ‘The foregoing opinion, ‘which I hereby approve, was prepared ~ by Assistant Attorney General Thomas S. Gay. i Sincerely, . re STEVE CLARK cee ee be mee cee, ae Attorney General Isc: TSG: jk