WSR 01-20-037

PROPOSED RULES

DEPARTMENT OF

RETIREMENT SYSTEMS

[ Filed September 26, 2001, 1:42 p.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 01-04-027.

Title of Rule:


WAC# WAC Title Statutory Authority (RCWs)
415-02-130 Members receive retirement and account information annually. 41.50.065
415-10-010 Can I purchase service credit after the statutory deadline? 41.50.165
415-10-030 Calculation of cost to purchase service credit in LEOFF Plan 1, LEOFF Plan 2, PERS Plan 2, TRS Plan 2, or SERS Plan 2. 41-50-165
415-10-080 If I purchase service credit, can I receive a refund of my payments? 41.26.540, 41.32.498, 41.40.730, 41.40.830, 41.50.160, 41.50.165, 41.50.175
415-10-100 Can I purchase TRS Plan 2 credit in TRS Plan 3? 41.50.165, 41.50.175
415-10-110 Can I purchase SERS Plan 2 credit in SERS Plan 3? Repeal
415-108-315 Designation of beneficiaries--Death benefit if a members dies before retirement. 41.40.270, 41.40.700, 41.40.835
415-108-324 Married member's benefit selection -- Spousal consent required. 41.40.188(2), 41.40.660(2), 41.40.845(2)
415-108-340 Actuarial tables, schedules, and factors Chapter 41.45 RCW
415-108-441 Purpose and scope of compensation earnable rules. 41.40.010(8), chapter 41.40 RCW
415-108-443 Reportable compensation table. 41.40.010(8), chapter 41.40 RCW
415-108-456 Leave payments earned over time. 41.40.010(8)
415-108-458 Severance pay earned over time. 41.40.010(8)
415-108-464 Legislative leave. 41.40.010(8)
415-108-465 Paid leave not earned over time. 41.40.710
415-111-110 Member and employer responsibility. 41.50.112, 41.50.145, chapter 41.34 RCW

Purpose: These rules are necessary to implement the Public Employees' Retirement System Plan 3. DRS is also converting as much language as possible to "Plain English."

Other Identifying Information: Unless specifically noted, substantive changes are required by ESSB 6530 (chapter 247, Laws of 2000). Sections of the Internal Revenue Code, 26 USC, may also apply. NOTE: Additional PERS Plan 3 changes will be made in separate filings.

Statutory Authority for Adoption: RCW 41.50.050(5).

Statute Being Implemented: See Title of Rule above.

Reasons Supporting Proposal: These rules are necessary to implement the Public Employees' Retirement System Plan 3.

Name of Agency Personnel Responsible for Drafting: Merry A. Kogut, P.O. Box 48380, Olympia, WA 98504-8380, (360) 664-7291; Implementation and Enforcement: Jack Bryant, P.O. Box 48380, Olympia, WA 98504-8380, (360) 664-7193.

Name of Proponent: Department of Retirement Systems, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: Each rule is being amended to implement ESSB 6530 (2000). At the same time, the department is attempting to improve the clarity of each rule.

Proposal Changes the Following Existing Rules: See Title of Rule above.

No small business economic impact statement has been prepared under chapter 19.85 RCW. These amendments have no effect on businesses.

RCW 34.05.328 does not apply to this rule adoption. The Department of Retirement Systems is not one of the named departments in RCW 34.05.328.

Hearing Location: Department of Retirement Systems, 6835 Capitol Boulevard, Boardroom, Tumwater, WA, on December 4, 2001, at 10:00 a.m.; and at the Department of Social and Health Services, Spokane Valley CSO, Lunchroom, 8517 East Trent, Spokane, WA, on December 6, 2001, at 10:00 a.m.

Assistance for Persons with Disabilities: Contact the rules coordinator by seven days before the hearing, if possible, phone (360) 664-7291, TTY (360) 586-5450, e-mail merryk@drs.wa.gov.

Submit Written Comments to: Identify WAC Numbers, Merry A. Kogut, Rules Coordinator, Department of Retirement Systems, P.O. Box 48380, Olympia, WA 98504-8380, e-mail Merryk@drs.wa.gov, fax (360) 753-3166, by 5:00 p.m. on December 6, 2001.

Date of Intended Adoption: No sooner than December 7, 2001.

September 26, 2001

Merry A. Kogut

Rules Coordinator

OTS-5184.1


AMENDATORY SECTION(Amending WSR 00-10-016, filed 4/21/00, effective 5/22/00)

WAC 415-02-130   ((Members)) Will I receive retirement and account information ((annually.))?   (1) DRS provides ((information in an annual)) statements to all members who are currently employed and are being reported, and to inactive members who provide a mailing address.

(2) If you are a member of Plan 1 or 2, you will receive annual statements. The statements include, but are not limited to, the following information:

(a) Service credit;

(b) Contributions; ((and))

(c) Interest; and

(d) Various retirement information.

(((2) The annual statement is based on information provided to the department by the employer as of a certain date. At the time the department compiles the annual statement, it may not have all the information necessary to make a final computation of any data reported. Information in the annual statement is subject to correction.)) (3) For a member of Plan 3, you will receive two types of statements.

(a) The defined benefit portion of your plan will provide an annual statement of your accumulated service credit and various retirement information.

(b) The defined contribution portion of your plan will provide annual and quarterly statements. The statements include, but are not limited to, contributions and account activity.

(4) Statements are based on information provided to the department by your employer and are subject to correction.

[Statutory Authority: RCW 41.50.050. 00-10-016, 415-02-130, filed 4/21/00, effective 5/22/00.]

OTS-5185.2


AMENDATORY SECTION(Amending WSR 00-22-049, filed 10/27/00, effective 11/27/00)

WAC 415-10-010   Can I purchase service credit after the statutory deadline?   RCW 41.50.165 generally allows ((the member)) you to purchase service credit that ((he or she)) you failed to establish or reestablish within the statutory deadline.

(1) You must pay the actuarial value of the increase to your retirement ((allowance)) benefit. The actuarial value of the increase to ((the member's)) your benefit means the cost to the retirement system trust fund of:

(a) Including the additional service credit in ((the member's)) your retirement ((allowance)) benefit calculation; and

(b) ((Commencing the member's)) Beginning your retirement ((allowance)) benefit at an earlier age, if applicable. This second factor ((will not apply if the member's retirement system is LEOFF 1, LEOFF 2, PERS 2, or TRS 2, because length of service is not a factor in determining eligibility to retire in those systems)) applies only to PERS Plan 1 and TRS Plan 1.

(2) The valuation is based upon economic assumptions. The cost to the retirement system trust fund for the increased value to ((the member's)) your benefit is calculated based upon interest rate assumptions adopted by the pension funding council and actuarial factors adopted or approved by the state actuary.

[Statutory Authority: Chapter 41.50 RCW. 00-22-049, 415-10-010, filed 10/27/00, effective 11/27/00. Statutory Authority: RCW 41.50.050 and 41.50.165. 97-01-014, 415-10-010, filed 12/6/96, effective 1/6/97.]


AMENDATORY SECTION(Amending WSR 00-22-049, filed 10/27/00, effective 11/27/00)

WAC 415-10-030   Calculation of cost to purchase service credit ((in LEOFF Plan 1, LEOFF Plan 2, PERS Plan 2, TRS Plan 2, or SERS Plan 2)).   If you are a member of LEOFF Plan 1 or 2, ((LEOFF Plan 2,)) PERS Plan 2 or 3, TRS Plan 2 or 3, ((TRS Plan 3,)) or SERS Plan 2 or ((SERS Plan)) 3, the department will calculate the actuarial value of the service credit you purchase under RCW 41.50.165(2) using the following formula:

Average Earnings (()) x Service Credit Being Purchased (()) x Factor 1

= Cost to purchase service credit


[Statutory Authority: Chapter 41.50 RCW. 00-22-049, 415-10-030, filed 10/27/00, effective 11/27/00. Statutory Authority: RCW 41.50.050 and 41.50.165. 97-01-014, 415-10-030, filed 12/6/96, effective 1/6/97.]


AMENDATORY SECTION(Amending WSR 00-22-049, filed 10/27/00, effective 11/27/00)

WAC 415-10-080   If I purchase service credit under RCW 41.50.165, can I receive a refund of my payments?   (1) You may ((not)) receive a refund ((unless)) only after you separate from service and ((withdraw)) apply for withdrawal of your contributions. ((Except as provided under subsections (2) and (3) of this section,)) Your payments to purchase service credit under RCW 41.50.165(2) qualify as a part of your accumulated contributions. ((As with other accumulated contributions, you may not receive a refund of your payments unless you separate from service and withdraw all your contributions.)) There are additional restrictions for TRS Plan 1, LEOFF Plan 2 and members of the Plan 3 systems as listed in subsections (2), (3), and (4) of this section.

(2) ((Additional)) Restrictions for TRS Plan 1 members. ((If you are a TRS 1 member)) At the time of retirement, RCW 41.32.498(2) prohibits you from withdrawing payments made to purchase service credit under RCW 41.50.165(2) ((at the time of retirement)).

(3) ((Additional)) Restrictions for LEOFF Plan 2 members. ((If you are a LEOFF Plan 2 member,)) Payments made to purchase service credit under RCW 41.50.165(2) and interest on those payments ((may)) will be refunded at one hundred percent. ((However, such)) Those payments ((may)) will not be included when calculating the one hundred fifty percent refund of contributions under RCW 41.26.540 (1)(b).

(4) Restrictions for Plan 3 members of TRS, SERS and PERS. When you apply for service credit under RCW 41.50.165(2), one-half of the amount due will go into your defined benefit plan and one-half will go into your defined contribution plan. As a member of any Plan 3 system, you may apply for a refund of your contributions from the defined contribution portion of your account upon separation from employment. Your refund will be based on the market value of your contributions, including earnings and losses, at the time you withdraw. The defined benefit portion will be paid when you are eligible to receive benefits.


Example 1 (Market has gains):


Joe restores 5 years of service credit at a total cost of $10,000.00. One-half, or $5,000.00, goes into Joe's defined contribution plan member account, and the other $5,000.00 goes into the pension trust fund for his defined benefit plan. Joe separates two years later and applies for the withdrawal of his defined contribution account. While Joe was in service the market experienced gains. The value of Joe's defined contribution account is now $6,000.00. Joe receives $6,000.00 (minus applicable taxes and penalties). The defined benefit portion is not refundable but Joe will receive a one percent defined benefit allowance when he is eligible.


Example 2 (Market has losses):


Joe restores 5 years of service credit at a total cost of $10,000.00. One-half, or $5,000.00, goes into Joe's defined contribution plan member account, and the other $5,000.00 goes into the pension trust fund for his defined benefit plan. Joe separates two years later and applies for the withdrawal of his defined contribution account. While Joe was in service the market suffered a loss. The value of Joe's defined contribution account is now $4,000.00. Joe receives $4,000.00 (minus applicable taxes and penalties). The defined benefit portion is not refundable but Joe will receive a one percent defined benefit allowance when he is eligible.

[Statutory Authority: Chapter 41.50 RCW. 00-22-049, 415-10-080, filed 10/27/00, effective 11/27/00. Statutory Authority: RCW 41.50.050 and 41.50.165. 97-01-014, 415-10-080, filed 12/6/96, effective 1/6/97.]


AMENDATORY SECTION(Amending WSR 00-22-049, filed 10/27/00, effective 11/27/00)

WAC 415-10-100   ((Can I purchase TRS Plan 2 credit in TRS Plan 3?)) Can a Plan 3 member purchase service credit?   ((Yes.)) (1) Transferring purchased ((TRS)) Plan 2 credit under RCW 41.50.165(2) into ((TRS)) Plan 3. If you purchase ((TRS)) Plan 2 service credit under this chapter and later ((elect to)) enter ((TRS)) Plan 3, that credit will also transfer to ((TRS)) Plan 3.

(a) Fifty percent of the money you paid to purchase the service credit will be credited to the ((TRS)) Plan 3 defined contribution account ((established under chapter 41.34 RCW)).

(b) The other fifty percent will be credited to the ((TRS)) Plan 3 defined benefit ((portion)) plan established under RCW 41.32.831 for TRS Plan 3, RCW 41.35.600 for SERS Plan 3, and RCW 41.40.780 for PERS Plan 3.

(2) Purchasing ((TRS)) Plan 2 service credit after transferring to ((TRS)) Plan 3. You may purchase service credit initially available under ((TRS)) Plan 2 after you transfer to ((TRS)) Plan 3. The service will be credited in ((TRS)) Plan 3. If you purchase Plan 2 service credit under this chapter, fifty percent of the money you pay to purchase the service credit will be credited to ((the TRS)) your Plan 3 defined contribution account ((established under chapter 41.34 RCW)). The other fifty percent will be credited to the ((TRS)) Plan 3 defined benefit portion established under RCW 41.32.831 for TRS Plan 3, RCW 42.35.600 for SERS Plan 3 and RCW 41.40.780 for PERS Plan 3.

(3) Not applicable for service earned after transferring to ((TRS)) Plan 3 ((cannot be purchased)). Service ((earned)) you earn as a Plan 3 member is automatically recredited if ((the member)) you reenter((s)) membership and earn((s)) at least twelve service credit months. Plan 3 does not have any deadlines on establishing optional service. Because there are no deadlines for establishing or reestablishing service credit there is no provision for purchasing service credit earned in Plan 3 under RCW 41.50.165.

[Statutory Authority: Chapter 41.50 RCW. 00-22-049, 415-10-100, filed 10/27/00, effective 11/27/00. Statutory Authority: RCW 41.50.050 and 41.50.165. 97-01-014, 415-10-100, filed 12/6/96, effective 1/6/97.]


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 415-10-110 Can I purchase SERS Plan 2 credit in SERS Plan 3?

OTS-5183.2


AMENDATORY SECTION(Amending WSR 00-10-015, filed 4/21/00, effective 5/22/00)

WAC 415-108-315   ((Designation of beneficiaries -- Death benefit if a member dies before retirement.)) Can I specify who can receive my benefits if I die in service?   (1) ((As a member,)) You have the right to designate a beneficiary or beneficiaries to receive a benefit ((in the event of your death)) if you die while you are an active member. You may change your beneficiary designation at any time by filing a change of beneficiary form with the department.

(2) As a member you may name:

(a) An organization or person, including your unborn or later adopted children. Unborn or later adopted children will not be included unless you specifically designate them as beneficiaries on the form. You must state the date of birth for any living person you name as a beneficiary;

(b) Your estate; and/or

(c) A trust ((in existence at the time of death)). Before making a distribution to any trust the department must receive:

(i) A copy of the trust document;

(ii) The name, address, and telephone number of the current trustee; and

(iii) The tax identification number((;

(d) A trust to be established under your last will)).

(3) You may name contingent beneficiaries in addition to primary beneficiaries.

(4) If you are a member of Plan 3, you may name the same or different beneficiaries for your defined benefit and defined contribution accounts.


Examples:


EXAMPLE ONE.

Facts


John, a member, completes a beneficiary designation form.


In the place on the form reserved for persons, he names his daughter Ann. He checks the box to indicate that Ann is a primary beneficiary.


In the place on the form reserved for trust/organizational beneficiaries, he lists the "Barbara Trust." His daughter Barbara is the trust beneficiary. He checks the box to indicate that the trust is a primary beneficiary.


Result


Subject to applicable statute, at John's death, the department will consider both the Barbara Trust and daughter Ann as primary beneficiaries. The department will require the name of the trustee, the tax identification number, a copy of the trust and other information specified in this rule before distribution to the trust.


EXAMPLE TWO.

Facts


John, a member, completes a beneficiary designation form.


In the place on the form reserved for persons, he names his daughter Ann. He checks the box to indicate that Ann is a primary beneficiary.


In the place on the form reserved for trust/organizational beneficiaries, he lists his daughter Barbara personally ((()) i.e., no trust name is provided(())). ((He checks the box labeled "primary beneficiary." John misunderstands the form and rather than provide the names of the trustee or trust administrator, John writes the word "both" in the blank provided.)) John checks the corresponding box to indicate a primary beneficiary designation. At John's death, the department learns that John has created no trusts.


Result


((At John's death, the department learns that John has created no trusts. Subject to existing statute, if the department receives no notice of competing claims to John's death benefit, the department will distribute the death benefit to Ann.)) Because John has created no trust, the designation in the trust/organizational location on the form is void. Subject to existing law, the department will issue the death benefit to Ann unless it receives a notice of a competing claim. If the department receives notice of competing claims, a court resolution may be required.

[Statutory Authority: RCW 41.50.050. 00-10-015, 415-108-315, filed 4/21/00, effective 5/22/00.]


AMENDATORY SECTION(Amending WSR 99-14-008, filed 6/24/99, effective 7/25/99)

WAC 415-108-324   ((Married member's benefit selection -- Spousal consent required.)) I am married - do I need my spouse's consent on the retirement option I choose?   (1) ((The member,)) If married, you must provide ((the)) your spouse's written consent to the option you selected under WAC 415-108-326. If, as a married member ((does)), you do not provide spousal consent, the department will pay ((the retired member)) you as a retiree, a joint and one-half survivor benefit allowance and record ((the member's)) your spouse as the survivor in compliance with ((chapter 41.40 RCW and RCW 41.40.660(2))) RCW 41.40.188 (2)(a), 41.40.660 (2)(a), and 41.40.845 (2)(a).

(2) Spousal consent is not needed to enforce a marital dissolution order requiring the department to pay an ex-spouse under RCW 41.50.790.

(3) "Spousal consent" means that ((the married member's)) your spouse consents to the retirement option you selected ((by the member)). ((The)) Your spouse's notarized signature on a completed retirement application constitutes spousal consent.

[Statutory Authority: RCW 41.50.050. 99-14-008, 415-108-324, filed 6/24/99, effective 7/25/99. Statutory Authority: RCW 2.10.146, 41.26.460, 41.32.530, 41.50.050, 41.32.785, 41.40.188 and 41.40.660. 96-01-047, 415-108-324, filed 12/14/95, effective 1/14/96. Statutory Authority: RCW 34.05.050 and 1990 c 249. 91-03-015, 415-108-324, filed 1/7/91, effective 2/7/91.]


AMENDATORY SECTION(Amending WSR 96-03-100, filed 1/19/96, effective 2/19/96)

WAC 415-108-340   Actuarial tables, schedules, and factors.   This ((chapter)) section contains the tables, schedules, and factors ((adopted by the director of the department of retirement systems)) for calculating optional retirement allowances and postretirement adjustments of members of the Washington state public employees' retirement system (PERS). These tables, schedules, and factors were adopted by the director upon the recommendation of the state actuary ((based on the actuary's)) after investigation into the mortality, service, compensation, and other experience of the PERS members and beneficiaries ((of public employees' retirement system. The tables, schedules, and factors contained in this chapter shall govern the retirement allowances only of members retiring during the period from January 1, 1996, until such time as these tables, schedules, and factors are amended by the director following the next actuarial investigation conducted by the state actuary. The retirement allowances calculated at the time of retirement of members retiring before January 1, 1996, shall continue to be governed by the tables, schedules, and factors in effect when each member retires. Any new tables, schedules, and factors adopted by the director in the future shall govern retirement allowances calculated at the time of retirement only of members retiring after the adoption of such new tables, schedules, and factors)).

(1) These tables, schedules and factors may be amended from time to time, based upon subsequent actuarial investigation.

(2) The department will use the tables, schedules and factors in effect upon the member's retirement to calculate the member's retirement allowance. Accordingly, these values apply to the calculation of retirement allowances for those who retire on or after January 1, 1996 (until subsequent amendment).

(3) The department will use these tables, schedules and factors to calculate postretirement adjustments that become effective on or after January 1, 1996, even though the member's retirement allowance was initially calculated using a prior set of tables, schedules and factors.


PUBLIC EMPLOYEES RETIREMENT SYSTEM

PLAN 1

Early Retirement Factors

by Year and Month
0 0 1.0000
1 .9915
2 .9830
3 .9746
4 .9661
5 .9576
6 .9491
7 .9407
8 .9322
9 .9237
10 .9152
11 .9068
1 0 .8983
1 .8908
2 .8834
3 .8759
4 .8685
5 .8610
6 .8536
7 .8461
8 .8387
9 .8312
10 .8238
11 .8163
2 0 .8089
1 .8023
2 .7957
3 .7892
4 .7826
5 .7760
6 .7694
7 .7629
8 .7563
9 .7497
10 .7431
11 .7366
3 0 .7300
1 .7242
2 .7183
3 .7125
4 .7067
5 .7009
6 .6951
7 .6892
8 .6834
9 .6776
10 .6718
11 .6660
4 0 .6601
1 .6550
2 .6498
3 .6446
4 .6395
5 .6343
6 .6291
7 .6240
8 .6188
9 .6136
10 .6085
11 .6033
5 0 .5981
1 .5935
2 .5889
3 .5843
4 .5797
5 .5751
6 .5705
7 .5659
8 .5613
9 .5567
10 .5521
11 .5475
6 0 .5429
1 .5388
2 .5347
3 .5306
4 .5265
5 .5224
6 .5182
7 .5141
8 .5100
9 .5059
10 .5018
11 .4977
7 0 .4936
1 .4899
2 .4862
3 .4825
4 .4789
5 .4752
6 .4715
7 .4678
8 .4642
9 .4605
10 .4568
11 .4531
8 0 .4494
1 .4461
2 .4428
3 .4395
4 .4362
5 .4329
6 .4296
7 .4263
8 .4230
9 .4197
10 .4164
11 .4131
9 0 .4098
1 .4068
2 .4039
3 .4009
4 .3979
5 .3950
6 .3920
7 .3890
8 .3860
9 .3831
10 .3801
11 .3771
10 0 .3742
1 .3715
2 .3688
3 .3661
4 .3635
5 .3608
6 .3581
7 .3554
8 .3528
9 .3501
10 .3474
11 .3447
11 0 .3420
1 .3396
2 .3372
3 .3348
4 .3324
5 .3300
6 .3275
7 .3251
8 .3227
9 .3203
10 .3179
11 .3154
12 0 .3130
1 .3108
2 .3087
3 .3065
4 .3043
5 .3021
6 .2999
7 .2977
8 .2955
9 .2933
10 .2912
11 .2890
13 0 .2868
1 .2848
2 .2828
3 .2808
4 .2789
5 .2769
6 .2749
7 .2729
8 .2709
9 .2689
10 .2670
11 .2650
14 0 .2630
1 .2612
2 .2594
3 .2576
4 .2558
5 .2540
6 .2522
7 .2504
8 .2486
9 .2468
10 .2450
11 .2432
15 0 .2414
1 .2398
2 .2381
3 .2365
4 .2348
5 .2332
6 .2316
7 .2299
8 .2283
9 .2267
10 .2250
11 .2234
16 0 .2218
1 .2203
2 .2188
3 .2173
4 .2158
5 .2143
6 .2128
7 .2113
8 .2098
9 .2084
10 .2069
11 .2054
17 0 .2039
1 .2025
2 .2012
3 .1998
4 .1985
5 .1971
6 .1957
7 .1944
8 .1930
9 .1917
10 .1903
11 .1890
18 0 .1876
1 .1864
2 .1851
3 .1839
4 .1826
5 .1814
6 .1802
7 .1789
8 .1777
9 .1764
10 .1752
11 .1740
19 0 .1727
1 .1716
2 .1705
3 .1693
4 .1682
5 .1671
6 .1659
7 .1648
8 .1637
9 .1625
10 .1614
11 .1603
20 0 .1591
1 .1581
2 .1571
3 .1560
4 .1550
5 .1540
6 .1529
7 .1519
8 .1509
9 .1498
10 .1488
11 .1478
21 0 .1467
1 .1458
2 .1448
3 .1439
4 .1429
5 .1420
6 .1410
7 .1401
8 .1391
9 .1382
10 .1372
11 .1363
22 0 .1353
1 .1345
2 .1336
3 .1327
4 .1319
5 .1310
6 .1301
7 .1293
8 .1284
9 .1275
10 .1267
11 .1258
23 0 .1249
1 .1241
2 .1233
3 .1225
4 .1217
5 .1209
6 .1201
7 .1193
8 .1185
9 .1177
10 .1169
11 .1161
24 0 .1153
1 .1146
2 .1139
3 .1132
4 .1124
5 .1117
6 .1110
7 .1102
8 .1095
9 .1088
10 .1080
11 .1073
25 0 .1066
1 .1059
2 .1052
3 .1046
4 .1039
5 .1032
6 .1025
7 .1019
8 .1012
9 .1005
10 .0998
11 .0992
26 0 .0985
1 .0979
2 .0973
3 .0966
4 .0960
5 .0954
6 .0948
7 .0942
8 .0936
9 .0929
10 .0923
11 .0917
27 0 .0911
1 .0905
2 .0899
3 .0894
4 .0888
5 .0882
6 .0877
7 .0871
8 .0865
9 .0860
10 .0854
11 .0848
28 0 .0842
1 .0837
2 .0832
3 .0827
4 .0822
5 .0816
6 .0811
7 .0806
8 .0801
9 .0795
10 .0790
11 .0785
29 0 .0780
1 .0775
2 .0770
3 .0765
4 .0760
5 .0755
6 .0751
7 .0746
8 .0741
9 .0736
10 .0731
11 .0726
30 0 .0722
1 .0717
2 .0713
3 .0708
4 .0704
5 .0699
6 .0695
7 .0690
8 .0686
9 .0682
10 .0677
11 .0673
31 0 .0668
1 .0664
2 .0660
3 .0656
4 .0652
5 .0648
6 .0644
7 .0639
8 .0635
9 .0631
10 .0627
11 .0623
32 0 .0619
1 .0615
2 .0611
3 .0608
4 .0604
5 .0600
6 .0596
7 .0592
8 .0589
9 .0585
10 .0581
11 .0577
33 0 .0573
1 .0570
2 .0566
3 .0563
4 .0559
5 .0556
6 .0552
7 .0549
8 .0545
9 .0542
10 .0538
11 .0535
34 0 .0531
1 .0528
2 .0525
3 .0522
4 .0518
5 .0515
6 .0512
7 .0509
8 .0506
9 .0502
10 .0499
11 .0496
35 or more .0493

PUBLIC EMPLOYEES RETIREMENT SYSTEM

((Plan II)) Plans 2 and 3 Option 1

Monthly Benefit per $1.00

of Accumulation

20 .0039357
21 .0039525
22 .0039702
23 .0039887
24 .0040081
25 .0040286
26 .0040500
27 .0040726
28 .0040963
29 .0041213
30 .0041476
31 .0041753
32 .0042044
33 .0042351
34 .0042675
35 .0043015
36 .0043375
37 .0043756
38 .0044157
39 .0044581
40 .0045029
41 .0045502
42 .0046001
43 .0046528
44 .0047084
45 .0047670
46 .0048287
47 .0048939
48 .0049626
49 .0050352
50 .0051120
51 .0051933
52 .0052795
53 .0053712
54 .0054687
55 .0055727
56 .0056837
57 .0058025
58 .0059296
59 .0060657
60 .0062116
61 .0063676
62 .0065347
63 .0067134
64 .0069044
65 .0071085
66 .0073263
67 .0075587
68 .0078066
69 .0080711
70 .0083537
71 .0086558
72 .0089785
73 .0093230
74 .0096898
75 .0100792
76 .0104910
77 .0109250
78 .0113811
79 .0118589
80 .0123587
81 .0128793
82 .0134243
83 .0139934
84 .0145880
85 .0152103
86 .0158600
87 .0165374
88 .0172413
89 .0179682
90 .0187162
91 .0194835
92 .0202654
93 .0210569
94 .0218459
95 .0226265
96 .0234038
97 .0241752
98 .0249356
99 .0256785

Public Employees Retirement System PERS I Optional COLA* Public Employees Retirement System Plan 1 Option 1 Monthly Benefit per $1.00 of Accumulation

Age
20 0.6369 20 .0061792
21 0.6386 21 .0061891
22 0.6404 22 .0061997
23 0.6422 23 .0062111
24 0.6441 24 .0062232
25 0.6460 25 .0062362
26 0.6480 26 .0062501
27 0.6501 27 .0062650
28 0.6522 28 .0062809
29 0.6544 29 .0062979
30 0.6567 30 .0063162
31 0.6590 31 .0063357
32 0.6614 32 .0063566
33 0.6639 33 .0063790
34 0.6665 34 .0064030
35 0.6691 35 .0064286
36 0.6718 36 .0064561
37 0.6747 37 .0064856
38 0.6775 38 .0065173
39 0.6805 39 .0065512
40 0.6836 40 .0065875
41 0.6867 41 .0066263
42 0.6899 42 .0066677
43 0.6932 43 .0067119
44 0.6966 44 .0067590
45 0.7001 45 .0068091
46 0.7036 46 .0068624
47 0.7073 47 .0069190
48 0.7111 48 .0069792
49 0.7149 49 .0070432
50 0.7188 50 .0071114
51 0.7229 51 .0071843
52 0.7270 52 .0072621
53 0.7312 53 .0073455
54 0.7355 54 .0074351
55 0.7399 55 .0075313
56 0.7444 56 .0076350
57 0.7490 57 .0077467
58 0.7537 58 .0078672
59 0.7585 59 .0079972
60 0.7633 60 .0081375
61 0.7682 61 .0082885
62 0.7733 62 .0084509
63 0.7783 63 .0086255
64 0.7835 64 .0088128
65 0.7887 65 .0090135
66 0.7939 66 .0092282
67 0.7992 67 .0094577
68 0.8046 68 .0097029
69 0.8099 69 .0099651
70 0.8154 70 .0102454
71 0.8208 71 .0105455
72 0.8263 72 .0108665
73 0.8317 73 .0112093
74 0.8372 74 .0115744
75 0.8426 75 .0119617
76 0.8480 76 .0123709
77 0.8534 77 .0128014
78 0.8584 78 .0132528
79 0.8641 79 .0137246
80 0.8693 80 .0142169
81 0.8745 81 .0147281
82 0.8796 82 .0152621
83 0.8846 83 .0158184
84 0.8896 84 .0163986
85 0.8945 85 .0170045
86 0.8993 86 .0176361
87 0.9040 87 .0182936
88 0.9086 88 .0189757
89 0.9131 89 .0196789
90 0.9174 90 .0204015
91 0.9216 91 .0211420
92 0.9255 92 .0218957
93 0.9294 93 .0226575
94 0.9329 94 .0234160
95 0.9363 95 .0241655
96 0.9395 96 .0249116
97 0.9424 97 .0256520
98 0.9452 98 .0263822
99 0.9477 99 .0270961

PERS I Survivor Option Factors


Member Younger

Age Difference OPTION II (100%) OPTION IV

(66 2/3%)

 OPTION III (50%)

20

 0.948 0.965 0.973
-19 0.945 0.963 0.972
-18 0.940 0.959 0.969
-17 0.936 0.956 0.967
-16 0.933 0.954 0.965
-15 0.929 0.951 0.963
-14 0.925 0.949 0.961
-13 0.921 0.946 0.959
-12 0.916 0.943 0.956
-11 0.910 0.938 0.953
-10 0.906 0.935 0.950
-9 0.900 0.931 0.948
-8 0.895 0.928 0.945
-7 0.889 0.923 0.941
-6 0.882 0.918 0.937
-5 0.876 0.914 0.934
-4 0.868 0.908 0.930
-3 0.860 0.902 0.925
-2 0.849 0.894 0.918
-1 0.836 0.884 0.911

Member Older

Age

Difference

 OPTION II (100%) OPTION IV

(66 2/3%)

 OPTION III (50%)
0

.822

 0.874 0.902
1 0.808 0.863 0.894
2 0.796 0.854 0.886
3 0.787 0.848 0.881
4 0.782 0.844 0.878
5 0.778 0.840 0.875
6 0.773 0.837 0.872
7 0.766 0.831 0.868
8 0.757 0.824 0.862
9 0.746 0.815 0.854
10 0.736 0.807 0.848
11 0.729 0.801 0.843
12 0.724 0.798 0.840
13 0.720 0.794 0.837
14 0.715 0.790 0.834
15 0.711 0.787 0.832
16 0.708 0.784 0.829
17 0.704 0.781 0.827
18 0.702 0.779 0.825
19 0.698 0.776 0.822
20 0.695 0.774 0.820
21 0.692 0.772 0.818
22 0.689 0.769 0.816
23 0.686 0.767 0.814
24 0.683 0.764 0.812
25 0.681 0.763 0.811
26 0.679 0.761 0.809
27 0.677 0.759 0.808
28 0.675 0.758 0.806
29 0.673 0.756 0.805
30 0.671 0.754 0.804
31 0.669 0.753 0.802
32 0.668 0.752 0.801
33 0.667 0.750 0.800
34 0.666 0.749 0.799
35 0.664 0.747 0.798
36 0.663 0.747 0.797
37 0.662 0.746 0.796
38 0.661 0.745 0.796
39 0.660 0.744 0.795
40 0.659 0.743 0.794
Age difference = member's age minus beneficiary's age

PERS ((II)) Plans 2 and 3 Survivor Option Factors


Member Younger

Age

Difference

 OPTION II (100%) OPTION IV

(66 2/3%)

 OPTION III (50%)
-20

.928

 0.951 0.962
-19 0.925 0.949 0.961
-18 0.922 0.946 0.959
-17 0.919 0.945 0.958
-16 0.916 0.942 0.956
-15 0.912 0.940 0.954
-14 0.908 0.937 0.952
-13 0.904 0.933 0.949
-12 0.898 0.930 0.946
-11 0.892 0.925 0.943
-10 0.885 0.920 0.939
-9 0.879 0.916 0.935
-8 0.873 0.911 0.932
-7 0.865 0.906 0.927
-6 0.857 0.900 0.923
-5 0.849 0.894 0.918
-4 0.839 0.887 0.912
-3 0.828 0.878 0.906
-2 0.813 0.867 0.897
-1 0.797 0.855 0.887

Member Older

Age

Difference

 OPTION II

(100%)

 OPTION IV

(66 2/3%)

 OPTION III

(50%)
0 0.779 0.841 0.876
1 0.763 0.829 0.866
2 0.748 0.817 0.856
3 0.735 0.807 0.848
4 0.725 0.798 0.841
5 0.716 0.791 0.835
6 0.708 0.785 0.830
7 0.698 0.777 0.823
8 0.687 0.767 0.815
9 0.674 0.757 0.806
10 0.662 0.747 0.797
11 0.653 0.739 0.791
12 0.646 0.733 0.786
13 0.640 0.728 0.781
14 0.634 0.722 0.776
15 0.628 0.717 0.772
16 0.622 0.712 0.767
17 0.616 0.707 0.763
18 0.611 0.702 0.759
19 0.606 0.698 0.755
20 0.602 0.694 0.751
21 0.596 0.689 0.747
22 0.591 0.684 0.743
23 0.587 0.681 0.740
24 0.582 0.676 0.736
25 0.577 0.672 0.732
26 0.573 0.668 0.729
27 0.569 0.665 0.726
28 0.565 0.661 0.722
29 0.562 0.658 0.720
30 0.558 0.655 0.717
31 0.555 0.652 0.714
32 0.552 0.649 0.712
33 0.549 0.647 0.709
34 0.546 0.644 0.707
35 0.543 0.641 0.705
36 0.540 0.638 0.702
37 0.538 0.637 0.700
38 0.535 0.634 0.698
39 0.533 0.632 0.696
40 0.531 0.630 0.695
Age difference = member's age minus beneficiary's age

PUBLIC EMPLOYEES RETIREMENT SYSTEM

PLANS 2 AND 3

Early Retirement Factors

by Year and Month
0 0 1.0000
1 .9910
2 .9821
3 .9731
4 .9641
5 .9551
6 .9462
7 .9372
8 .9282
9 .9193
10 .9103
11 .9013
1 0 .8923
1 .8845
2 .8767
3 .8688
4 .8610
5 .8531
6 .8453
7 .8374
8 .8296
9 .8217
10 .8139
11 .8061
2 0 .7982
1 .7913
2 .7844
3 .7776
4 .7707
5 .7638
6 .7569
7 .7500
8 .7431
9 .7363
10 .7294
11 .7225
3 0 .7156
1 .7096
2 .7035
3 .6975
4 .6914
5 .6853
6 .6793
7 .6732
8 .6672
9 .6611
10 .6551
11 .6490
4 0 .6429
1 .6376
2 .6322
3 .6269
4 .6215
5 .6162
6 .6109
7 .6055
8 .6002
9 .5948
10 .5895
11 .5841
5 0 .5788
1 .5740
2 .5693
3 .5646
4 .5598
5 .5551
6 .5504
7 .5456
8 .5409
9 .5362
10 .5314
11 .5267
6 0 .5220
1 .5178
2 .5136
3 .5094
4 .5052
5 .5010
6 .4968
7 .4926
8 .4884
9 .4842
10 .4800
11 .4758
7 0 .4716
1 .4678
2 .4641
3 .4603
4 .4566
5 .4529
6 .4491
7 .4454
8 .4416
9 .4379
10 .4342
11 .4304
8 0 .4267
1 .4234
2 .4200
3 .4167
4 .4134
5 .4100
6 .4067
7 .4033
8 .4000
9 .3967
10 .3933
11 .3900
9 0 .3867
1 .3837
2 .3807
3 .3777
4 .3747
5 .3718
6 .3688
7 .3658
8 .3628
9 .3598
10 .3569
11 .3539
10 0 .3509
1 .3482
2 .3456
3 .3429
4 .3402
5 .3375
6 .3349
7 .3322
8 .3295
9 .3269
10 .3242
11 .3215
11 0 .3188
1 .3165
2 .3141
3 .3117
4 .3093
5 .3069
6 .3045
7 .3021
8 .2997
9 .2973
10 .2949
11 .2925
12 0 .2901
1 .2879
2 .2858
3 .2836
4 .2815
5 .2793
6 .2771
7 .2750
8 .2728
9 .2707
10 .2685
11 .2664
13 0 .2642
1 .2623
2 .2603
3 .2584
4 .2564
5 .2545
6 .2526
7 .2506
8 .2487
9 .2467
10 .2448
11 .2429
14 0 .2409
1 .2392
2 .2374
3 .2357
4 .2339
5 .2322
6 .2304
7 .2287
8 .2269
9 .2252
10 .2234
11 .2216
15 0 .2199
1 .2183
2 .2167
3 .2151
4 .2136
5 .2120
6 .2104
7 .2088
8 .2072
9 .2057
10 .2041
11 .2025
16 0 .2009
1 .1995
2 .1980
3 .1966
4 .1952
5 .1937
6 .1923
7 .1909
8 .1894
9 .1880
10 .1866
11 .1851
17 0 .1837
1 .1824
2 .1811
3 .1798
4 .1785
5 .1772
6 .1759
7 .1746
8 .1733
9 .1720
10 .1707
11 .1694
18 0 .1681
1 .1670
2 .1658
3 .1646
4 .1634
5 .1623
6 .1611
7 .1599
8 .1587
9 .1575
10 .1564
11 .1552
19 0 .1540
1 .1529
2 .1519
3 .1508
4 .1497
5 .1487
6 .1476
7 .1465
8 .1455
9 .1444
10 .1433
11 .1422
20 0 .1412
1 .1402
2 .1392
3 .1383
4 .1373
5 .1363
6 .1353
7 .1344
8 .1334
9 .1324
10 .1315
11 .1305
21 0 .1295
1 .1286
2 .1277
3 .1269
4 .1260
5 .1251
6 .1242
7 .1233
8 .1224
9 .1215
10 .1207
11 .1198
22 0 .1189
1 .1181
2 .1173
3 .1165
4 .1157
5 .1149
6 .1140
7 .1132
8 .1124
9 .1116
10 .1108
11 .1100
23 0 .1092
1 .1085
2 .1077
3 .1070
4 .1063
5 .1055
6 .1048
7 .1041
8 .1033
9 .1026
10 .1018
11 .1011
24 0 .1004
1 .0997
2 .0990
3 .0984
4 .0977
5 .0970
6 .0963
7 .0957
8 .0950
9 .0943
10 .0937
11 .0930
25 0 .0923
1 .0917
2 .0911
3 .0905
4 .0898
5 .0892
6 .0886
7 .0880
8 .0874
9 .0868
10 .0862
11 .0856
26 0 .0849
1 .0844
2 .0838
3 .0833
4 .0827
5 .0821
6 .0816
7 .0810
8 .0804
9 .0799
10 .0793
11 .0788
27 0 .0782
1 .0777
2 .0772
3 .0767
4 .0761
5 .0756
6 .0751
7 .0746
8 .0741
9 .0736
10 .0731
11 .0725
28 0 .0720
1 .0716
2 .0711
3 .0706
4 .0701
5 .0697
6 .0692
7 .0687
8 .0683
9 .0678
10 .0673
11 .0668
29 0 .0664
1 .0659
2 .0655
3 .0651
4 .0646
5 .0642
6 .0638
7 .0634
8 .0629
9 .0625
10 .0621
11 .0616
30 0 .0612
1 .0608
2 .0604
3 .0600
4 .0596
5 .0592
6 .0588
7 .0584
8 .0580
9 .0576
10 .0572
11 .0568
31 0 .0564
1 .0561
2 .0557
3 .0553
4 .0550
5 .0546
6 .0543
7 .0539
8 .0535
9 .0532
10 .0528
11 .0524
32 0 .0521
1 .0517
2 .0514
3 .0511
4 .0507
5 .0504
6 .0501
7 .0497
8 .0494
9 .0491
10 .0487
11 .0484
33 0 .0481
1 .0478
2 .0475
3 .0471
4 .0468
5 .0465
6 .0462
7 .0459
8 .0456
9 .0453
10 .0450
11 .0447
34 0 .0444
1 .0441
2 .0438
3 .0435
4 .0433
5 .0430
6 .0427
7 .0424
8 .0421
9 .0418
10 .0416
11 .0413
35 0 .0410
1 .0407
2 .0405
3 .0402
4 .0400
5 .0397
6 .0394
7 .0392
8 .0389
9 .0387
10 .0384
11 .0381
36 0 .0379
1 .0376
2 .0374
3 .0372
4 .0369
5 .0367
6 .0364
7 .0362
8 .0360
9 .0357
10 .0355
11 .0352
37 0 .0350
1 .0348
2 .0346
3 .0343
4 .0341
5 .0339
6 .0337
7 .0335
8 .0332
9 .0330
10 .0328
11 .0326
38 0 .0324
1 .0322
2 .0320
3 .0318
4 .0316
5 .0313
6 .0311
7 .0309
8 .0307
9 .0305
10 .0303
11 .0301
39 0 .0299
1 .0297
2 .0296
3 .0294
4 .0292
5 .0290
6 .0288
7 .0286
8 .0284
9 .0282
10 .0281
11 .0279
40 0 .0277
1 .0275
2 .0273
3 .0272
4 .0270
5 .0268
6 .0266
7 .0265
8 .0263
9 .0261
10 .0260
11 .0258
41 0 .0256
1 .0255
2 .0253
3 .0251
4 .0250
5 .0248
6 .0247
7 .0245
8 .0243
9 .0242
10 .0240
11 .0239
42 0 .0237
1 .0236
2 .0234
3 .0233
4 .0231
5 .0230
6 .0228
7 .0227
8 .0225
9 .0224
10 .0222
11 .0221
43 0 .0219
1 .0218
2 .0217
3 .0215
4 .0214
5 .0213
6 .0211
7 .0210
8 .0209
9 .0207
10 .0206
11 .0205
44 0 .0203
1 .0202
2 .0201
3 .0199
4 .0198
5 .0197
6 .0196
7 .0194
8 .0193
9 .0192
10 .0191
11 .0189
45 or more .0188

[Statutory Authority: RCW 41.50.050. 96-03-100, 415-108-340, filed 1/19/96, effective 2/19/96. Statutory Authority: RCW 41.50.050, 41.40.165, 41.40.020 and 41.40.022. 91-02-018, 415-108-340, filed 12/21/90, effective 1/21/91.]


AMENDATORY SECTION(Amending WSR 98-09-059, filed 4/17/98, effective 5/18/98)

WAC 415-108-441   Purpose and scope of compensation earnable rules.   WAC 415-108-443 through 415-108-488 codify the department's ((existing)) interpretation of statutes and ((existing)) administrative practice regarding classification of payments as compensation earnable in PERS Plan ((I and PERS Plan II)) 1, 2, or 3. ((The department has applied and will apply)) These rules will be used to determine the proper characterization of payments occurring prior to and after the effective dates of these sections.

[Statutory Authority: RCW 41.50.050. 98-09-059, 415-108-441, filed 4/17/98, effective 5/18/98.]


AMENDATORY SECTION(Amending WSR 98-09-059, filed 4/17/98, effective 5/18/98)

WAC 415-108-443   PERS reportable compensation table.   The following table ((is provided as a quick reference guide to)) will help you ((characterize)) determine whether certain types of payments are reportable compensation under Plan ((I and Plan II)) 1, 2, or 3. Be sure to ((turn to)) read the referenced rule to ensure that you have correctly identified the payment in question. The department determines compensation earnable based upon the nature of the payment, not the name applied ((to it,)). See WAC 415-108-445.


Type of Payment PERS ((I)) 1 Reportable

Compensation?

 PERS ((II)) 2 or 3 Reportable

Compensation?
Annual Leave Cash Outs Yes - WAC 415-108-456 No - WAC 415-108-456
Assault Pay (State Emp.) Yes - WAC 415-108-468 Yes - WAC 415-108-468
Base Rate Yes - WAC 415-108-451 Yes - WAC 415-108-451
Car Allowances No - WAC 415-108-4851 No - WAC 415-108-485
Cafeteria Plans Yes - WAC 415-108-455 Yes - WAC 415-108-455
Deferred Wages Yes - WAC 415-108-459 Yes - WAC 415-108-459
Disability Payments No - WAC 415-108-477 No - WAC 415-108-477
Disability: Salary lost while on disability leave Yes - WAC 415-108-468 Yes - WAC 415-108-468
RCW 41.40.038 RCW 41.40.038
Employer Provided Vehicle No - WAC 415-108-4802 No - WAC 415-108-480
Employer taxes/contributions No - WAC 415-108-459 No - WAC 415-108-459
Fringe Benefits No - WAC 415-108-475 No - WAC 415-108-475
Illegal Payments No - WAC 415-108-482 No - WAC 415-108-482
Legislative Leave Yes - WAC 415-108-464 Yes - WAC 415-108-464
Longevity/Education

Attainment Pay

 Yes - WAC 415-108-451 Yes - WAC 415-108-451
Nonmoney Maintenance Yes - WAC 415-108-4703 No - WAC 415-108-470
Optional Payments No - WAC 415-108-483 No - WAC 415-108-483
Payments in Lieu of

Excluded Items

 No - WAC 415-108-463 No - WAC 415-108-463
Performance Bonuses Yes - WAC 415-108-453 Yes - WAC 415-108-453

1A portion of the value of an employer car allowance may be reportable, see WAC 415-108-485.


2A portion of the value of an employer provided vehicle may be reportable in Plan I only, see WAC 415-108-480.


3A portion of the value of nonmoney maintenance provided may be reportable in Plan I only, see WAC 415-108-470.


Type of Payment PERS ((I)) 1 Reportable

Compensation?

 PERS ((II)) 2 or 3 Reportable

Compensation?
Retroactive Salary Increase Yes - WAC 415-108-457 Yes - WAC 415-108-457
Reimbursements No - WAC 415-108-484 No - WAC 415-108-484
Reinstatement Payments Yes - WAC 415-108-467 Yes - WAC 415-108-467
Retirement or Termination

Bonuses

 No - WAC 415-108-487 No - WAC 415-108-487
Severance Pay - Earned

Over Time

 Yes - WAC 415-108-458 No - WAC 415-108-458
Severance Pay - Not Earned

Over Time

 No - WAC 415-108-488 No - WAC 415-108-488
Shared Leave - State Emp. Yes - WAC 415-108-468 Yes - WAC 415-108-468
Shared Leave - Local

Government Employees

 No - WAC 415-108-468 No - WAC 415-108-468
Sick Leave Cash Outs - State

Employees

 No - WAC 415-108-456 No - WAC 415-108-456
Sick Leave Cash Out - Local

Government Employees

 Yes - WAC 415-108-456 No - WAC 415-108-456
Standby Pay Yes - WAC 415-108-469 Yes - WAC 415-108-469
Time Off with Pay Yes - WAC 415-108-456 Yes - WAC 415-108-456
WAC 415-108-465 WAC 415-108-465
Union Leave4 Yes - WAC 415-108-466 Yes - WAC 415-108-466
Worker's Compensation No - WAC 415-108-479 No - WAC 415-108-479

4Only specific types of union leave are reportable, see WAC 415-108-466.

[Statutory Authority: RCW 41.50.050. 98-09-059, 415-108-443, filed 4/17/98, effective 5/18/98.]


AMENDATORY SECTION(Amending WSR 98-09-059, filed 4/17/98, effective 5/18/98)

WAC 415-108-456   Leave payments earned over time.   (1) Sick and annual leave usage. ((Sick leave and annual leave is accumulated over time and paid to a person during a period of excused absence. Leave accrues at a prescribed rate, usually a certain number of hours per month. The employee earns a leave day by rendering service during the month the leave accrued. When the employee uses his or her accrued leave by taking a scheduled work day off with pay, the payment is deferred compensation for services previously rendered. The payment is a salary or wage earned for services rendered and is reportable.))

(a) Leave accrues at a prescribed rate, usually a certain number of hours per month.

(b) You earn a leave day by providing service during the month the leave accrued.

(c) Sick leave and annual leave are accumulated over time and paid to you during a period of excused absence.

(d) When you use your accrued leave by taking a scheduled work day off with pay, the payment is deferred compensation for services previously provided.

(e) The payment is a salary or wage earned for services provided and is reportable.

(2) Annual leave cash outs. Annual leave cash outs, like payments for leave usage, are deferred compensation earned for services previously ((rendered)) provided. Whether, and to what extent an annual leave cash out qualifies as reportable compensation depends upon ((which)) the PERS plan ((the member)) to which you belong((s to)) and the type of employer.

(a) Plans 2 and 3: Annual leave cash outs are not reportable compensation ((for PERS Plan II members)). Although the payments are for services ((rendered)) provided, they are excluded from the definition of compensation earnable by statute((,)). See RCW 41.40.010 (8)(b).

(b) Plan 1, state government employees: A cash out of up to thirty days of annual leave for state government employees is reportable compensation ((for PERS Plan I,)). See RCW 43.01.040. A cash out in excess of thirty days of annual leave:

(i) Qualifies as reportable compensation if ((it)) the leave is authorized by a letter of necessity under RCW 43.01.040. Annual leave qualifies as authorized under a letter of necessity only if the leave was earned after the letter of necessity was issued;

(ii) Does not qualify as reportable compensation if ((it)) the leave is earned between the date that ((the member)) you accrued thirty days of annual leave and ((the member's)) your anniversary date under RCW 43.01.044.

(c) Plan 1 employees not covered by (2)(b): All annual leave cash outs received by PERS Plan ((I)) 1 members who are not state employees qualify as reportable compensation.

(3) Sick leave cash outs. Sick leave cash outs are deferred compensation for services previously ((rendered)) provided.

(a) Sick leave cash outs are excluded from the definition of compensation earnable for PERS Plan ((II)) 2 or 3 members by statute((,)). See RCW 41.40.010 (8)(b).

(b) Sick leave cash outs are reportable compensation for PERS Plan ((I)) 1 members other than state, school district, and educational service district employees.

(c) Sick leave cash outs are excluded from reportable compensation for:

(i) State employees by RCW 41.04.340;

(ii) School district employees by RCW 28A.400.210; and

(iii) Educational service district employees by RCW 28A.310.490.

See RCW 41.40.010 (8)(a).

[Statutory Authority: RCW 41.50.050. 98-09-059, 415-108-456, filed 4/17/98, effective 5/18/98.]


AMENDATORY SECTION(Amending WSR 98-09-059, filed 4/17/98, effective 5/18/98)

WAC 415-108-458   Severance pay earned over time.   (1) ((Plan I.)) PERS Plan 1: Severance pay ((must be)) earned over time ((in the same manner as annual leave or sick leave in order to be deferred compensation for services previously rendered and to be reportable in Plan I)) is reportable compensation. Conversely, severance pay ((is)) not earned over time ((if the employment contract(s) or compensation policies in effect at the beginning of a given period of employment specify that a certain amount of severance pay will be earned during that period in consideration for services rendered)) is not reportable compensation (see WAC 415-108-488). This is because severance pay earned over time is deferred compensation for services previously provided.

Severance pay is earned over time if the employment contract(s) or compensation policies in effect at the beginning of a given period of employment specify that a certain amount of severance pay will be earned during that period in consideration for services provided.


Example: Mr. Jones is a PERS Plan ((I)) 1 member employed as a city manager. Since the beginning of his term of employment with the city, his contract has specified that he will earn one week of severance pay for every year of his employment. The earned severance pay will be paid at the time of his separation. His severance pay is reportable compensation. When Mr. Jones retires, the two weeks severance pay that he earned during his two highest paid years (i.e., one week per year for two years) will be included in his PERS Plan ((I)) 1 retirement calculation.

To the extent that severance pay qualifies as reportable compensation and is earned within ((the member's)) your average final compensation period, the severance pay is excess compensation((,)). See RCW 41.50.150.

(2) PERS Plans ((II.)) 2 and 3: All forms of severance pay are excluded from earnable compensation ((for Plans II by)). See RCW 41.40.010 (8)(b).

(((3) Severance pay that is not earned over time is not earned for services rendered and is not reportable in Plan I or II, see WAC 415-108-488.))

[Statutory Authority: RCW 41.50.050. 98-09-059, 415-108-458, filed 4/17/98, effective 5/18/98.]


AMENDATORY SECTION(Amending WSR 98-09-059, filed 4/17/98, effective 5/18/98)

WAC 415-108-464   Legislative leave.   If ((a PERS member)) You take((s a)) leave without pay from an eligible position to serve in the legislature, ((the member)) you may ((elect)) choose to participate in PERS as a legislator.

(1) Plan ((I. The salary the employee would have earned from their employer is reportable compensation if the required member contribution is paid by the member and the required employer contribution is paid by the member or the employer.)) 1: Your reportable compensation is the salary you would have earned from your employer. You must pay employee contributions on this amount. Either you or your employer must pay employer contributions on the amount.

(2) Plan ((II. The employee)) 2 or 3: You may choose ((between:

(a) The)) your reportable compensation ((he or she)) to be:

(a) The reportable compensation you would have earned ((had the member not served in the legislature)) from your employer; or

(b) ((The)) Your actual reportable compensation for your legislative and nonlegislative ((public employment and the legislative)) service combined.

If ((the member selects option)) you choose (2)(a) of this subsection((, he or she is responsible for paying the additional employer and employee contributions to the extent the reportable compensation reported is higher than it would have been under (b) of this subsection)) and your reportable compensation is higher than it would have been under (2)(b) of this subsection, you must pay both employee and employer contributions on the excess amount.

[Statutory Authority: RCW 41.50.050. 98-09-059, 415-108-464, filed 4/17/98, effective 5/18/98.]


AMENDATORY SECTION(Amending WSR 98-09-059, filed 4/17/98, effective 5/18/98)

WAC 415-108-465   Is paid leave not earned over time((.)) reportable compensation for PERS?   ((If paid leave is not based upon earned leave accumulated over time, the payment is not a deferred payment for services previously rendered. Further, the member on leave is not currently rendering services in exchange for the payment. However,)) RCW 41.40.175 and 41.40.710 identify payments received from the employer while on paid leave as reportable for PERS. Contributions are due on these payments to the extent they meet the following conditions:

(1) The payment is equal to the salary ((for the position that the person is on leave from;)) that you normally earn in your position; and

(2) The payment is actually from the employer. Payments from an employer that are conditioned upon reimbursement from a third party are payments from the third party. Because the payments are not from the employer, they are not reportable compensation. The only exception is union leave paid by the employer subject to reimbursement from the union under the conditions specified in RCW 41.40.175 (Plan ((I)) 1) ((and)), RCW 41.40.710 (Plan ((II)) 2), RCW 41.40.805 (Plan 3), and WAC 415-108-466.

Example: Joe injures himself off the job and collects labor and industries payments instead of compensation from his employer. Because the payments are not from his employer, they are not reportable compensation.

[Statutory Authority: RCW 41.50.050. 98-09-059, 415-108-465, filed 4/17/98, effective 5/18/98.]

OTS-5189.2


AMENDATORY SECTION(Amending WSR 01-01-059, filed 12/12/00, effective 1/12/01)

WAC 415-111-110   Member and employer responsibility.   (1) What am I responsible for as a Plan 3 member? As a Plan 3 member your responsibilities include, but are not limited to:

(a) Adhering to ((published)) time frames;

(b) Making investment decisions for your defined contribution account;

(c) Reviewing account information provided on statements, such as quarterly statements, and notifying the correct organization of any errors;

(d) Filling out the correct form for a requested action;

(e) Correctly completing the appropriate form for a requested action and submitting the form to the correct organization as directed on each form; and

(f) Monitoring to ensure contributions do not exceed Internal Revenue Code limits (see WAC 415-111-111).

(2) What can happen if I do not fulfill my Plan 3 responsibilities? If you do not fulfill your responsibilities, the consequences may include, but are not limited to:

(a) You may not qualify for certain benefits, such as the transfer payment;

(b) You may have a delay in the correction of errors on your account;

(c) You may have a delay in the processing of your request for a defined contribution withdrawal; or

(d) You may have a delay in the investment of your account as directed.

(3) What responsibilities do employers have? Employers' responsibilities include, but are not limited to:

(a) Adhering to Plan 3 administrative requirements, including the respective roles of employers and employees, communicated to employers by the department in written materials and formal training((.));

(b) Maintaining a supply of Plan 3 forms;

(c) ((Submitting contributions to the department as soon as possible and at least in accordance with chapter 41.50 RCW;

(d))) Reporting an employee's Plan 3 transfer ((election)) decision as soon as possible after receipt of the appropriate form from the employee;

(((e))) (d) Submitting to DRS the form on which the member made ((their)) the Plan 3 transfer ((election)) decision as soon as possible after receipt of the appropriate form;

(((f))) (e) Reporting an employee's contribution rate ((election)) decision as soon as possible after receipt of the appropriate form from the employee;

(((g))) (f) Reporting an employee's investment program ((election)) as soon as possible after receipt of the appropriate form from the employee; ((and

(h))) (g) Monitoring to ensure that a member's contributions do not exceed Internal Revenue Code limits (see WAC 415-111-111); and

(h) Submitting contributions to the department as soon as reasonable and at least in accordance with RCW 41.50.120, "reasonableness" will be based on the facts and circumstances.


Example


Assume the following:

&sqbul; An employer has one payroll system;

&sqbul; Payroll checks are issued semimonthly;

&sqbul; At the same time checks are cut, the payroll department produces a data tape of employee contributions that has to be checked for accuracy, and checking the tape takes four days;

&sqbul; Once the accuracy of the data tape is confirmed, a check for the aggregate amount of employee contributions is sent by the employer to DRS; and

&sqbul; The entire process, from the cutting of payroll checks to the cutting of the aggregate employee contribution check takes eight days.

In this situation, eight days is a "reasonable" period of time.

(4) What can happen if my employer does not fulfill ((their)) its responsibilities?

(a) If your employer does not fulfill ((their)) its responsibilities, the consequences may include, but are not limited to:

(((a))) (i) Your employer may have to make your member account whole;

(((b))) (ii) Your employer may be subject to penalties assessed by the department; or

(((c))) (iii) Your employer may be subject to penalties assessed by the Internal Revenue Service.

(b) If the department determines that an employer has erred in its administrative role, such that an employee incurs an investment loss, the department will determine the amount of loss and bill the employer.

[Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-111-110, filed 12/12/00, effective 1/12/01.]

Washington State Code Reviser's Office