38-643. Public safety cancer insurance policy program account
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/az/title-38/38-643A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
A. The public safety cancer insurance policy program account is established and shall be under the exclusive control of the board. The board shall deposit monies collected pursuant to section 38-642 in the account to pay the cost of providing a group cancer insurance policy under the program and the cost of administering the program.
B. The board may use monies deposited in the account up to the amount equal to or less than ten percent of the total claims paid, averaged over the previous five years, each year ending June 30 to pay the costs of administering the program, excluding the costs of processing the claims, except that board attorney fees and court costs relating to the program shall be paid out of the account and are not subject to this limitation.
C. The board shall cause an independent audit of the account to be performed at the end of each fiscal year and shall report the results of the audit to each employer within six months following the end of the fiscal year.
D. The employer contributions and securities in the account and investment earnings on monies in the account are exempt from state, county and municipal taxes.
E. The program is a welfare benefit plan or trust intended to pay expenses incurred in the treatment of cancer as provided in the policy of insurance secured or established by the board pursuant to section 38-642. The legislature intends that the program's income be excluded as gross income for assessing federal income tax under section 115 of the internal revenue code and that coverage under the program be excluded as gross income to the employees or retirees under section 106 of the internal revenue code. The board may adopt additional program provisions as necessary to fulfill the legislature's intent that the program's income and coverage are not subject to federal income tax.
F. To the extent required to exclude coverage under the program as gross income of participants, employers that are required to participate in the program shall pay the premiums for the cost of the program and include the premium amount as wages of the firefighters and peace officers who are participating in the program, subject to federal and state income and employment taxes.
G. Employers, the board of trustees and any member of a local board do not guarantee the account in any manner against loss or depreciation and are not liable for any act or failure to act made in good faith pursuant to this article, including determinations on program claims.