WSR 05-08-031

PROPOSED RULES

DEPARTMENT OF

RETIREMENT SYSTEMS

[ Filed March 30, 2005, 11:42 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 04-15-037.

Title of Rule and Other Identifying Information: Chapter 415-112 WAC, Teachers' retirement system, this is Phase 1 of a 3-phase effort. This phase includes those rules from WAC 415-112-015 through 415-112-412 that require updating or clarification.

Hearing Location(s): Department of Retirement Systems, 6835 Capitol Boulevard, Conference Room 115, Tumwater, WA, on May 12, 2005, at 9:30.

Date of Intended Adoption: May 13, 2005.

Submit Written Comments to: Leslie L. Saeger, Rules Coordinator, Department of Retirement Systems, P.O. Box 48380, Olympia, WA 98504-8380, e-mail leslies@drs.wa.gov, fax (360) 753-3166, by 5:00 p.m. on May 12, 2005.

Assistance for Persons with Disabilities: Contact Leslie L. Saeger, Rules Coordinator, by May 2, 2005, TDD (360) 664-7291, TTY (360) 586-5450, phone (360) 664-7291.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The department has been reviewing and rewriting the teachers' retirement system rules to reflect current policy and clear writing standards. This is the first of three phases. Phase 2 will include the second portion of the chapter. Phase 3 will include topics, identified by staff in Phases 1 and 2, that they would like addressed or expanded upon in rule.

Statutory Authority for Adoption: RCW 41.50.050(5).

Statute Being Implemented: For WAC 415-112-015 is RCW 41.32.010 and chapter 41.32 RCW; for WAC 415-112-119, 415-112-300 and 415-112-401 is chapter 41.32 RCW; for WAC 415-112-120 is RCW 41.32.010(29); for WAC 415-112-122 is RCW 41.32.032; for WAC 415-112-125 is RCW 41.32.240, 41.32.780, 41.32.835, 41.32.013; for WAC 415-112-130 is RCW 41.32.240, 41.32.780, 41.32.835; for WAC 415-112-145 is RCW 41.32.500, 41.32.820, 41.32.837, chapter 41.32 RCW; for WAC 415-112-240 is RCW 41.32.010(26); for WAC 415-112-250 is RCW 41.32.267, 41.32.810, 41.32.865; for WAC 415-112-260 is RCW 41.32.270, 41.32.010(26); for WAC 415-112-270 and 415-112-290 is RCW 41.32.330; and for WAC 415-112-402 and 415-112-412 is RCW 41.32.010(10).

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

Name of Proponent: Department of Retirement Systems, governmental.

Name of Agency Personnel Responsible for Drafting: Leslie Saeger, P.O. Box 48380, Olympia, WA 98504-8380, (360) 664-7291; Implementation and Enforcement: Dorothy Bailey, P.O. Box 48380, Olympia, WA 98504-8380, (360) 664-7291.

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

A cost-benefit analysis is not required under RCW 34.05.328. The Department of Retirement Systems is not one of the named departments in RCW 34.05.328.

March 30, 2005

Leslie L. Saeger

Rules and Contracts Coordinator

OTS-7961.2


AMENDATORY SECTION(Amending WSR 04-21-080, filed 10/20/04, effective 11/20/04)

WAC 415-112-015   Definitions.   (((1))) All definitions in RCW 41.32.010 and WAC 415-02-030 apply to terms used in this chapter. Other terms relevant to the administration of chapter 41.32 RCW are defined in this chapter.

(1) Accrual date means the first date from which a member's or beneficiary's benefit is calculated. See WAC 415-112-520, RCW 41.32.795 and 41.32.855.

(2) (("))Annual leave((")) means leave provided by an employer for the purpose of taking regularly scheduled work time off with pay. Annual leave does not usually include leave for illness, personal business if in addition to and different than vacation leave, or other paid time off from work. However, if an employer authorizes only one type of leave, covering paid leave for vacation, illness, and any other excused absence from work, such leave will be considered annual leave for purposes of RCW 41.50.150.

(3) Dual member means a person who:

(a) Is or becomes a member of a retirement system, as defined in RCW 41.50.030 or 41.54.010(6), on or after July 1, 1988;

(b) Has been a member of one or more other systems; and

(c) Has never been retired for service from a retirement system and is not receiving a disability retirement or disability leave benefit from any retirement system listed in RCW 41.50.030 or 41.54.010(6). See WAC 415-113-041.

(4) Ineligible position means a position ((which)) that does not ((qualify as)) meet the requirements of an eligible position ((under)) as stated in RCW 41.32.010(37).

(((4))) (5) Pension benefit means that portion of a retiree's monthly retirement allowance that is funded by the state of Washington and the retiree's former employer or employers.

(((5))) (6) Public educational institution means a school district, the state school for the deaf, the state school for the blind, educational service districts, institutions of higher education, or community or technical colleges.

(((6))) (7)(a) Public school as defined in RCW 41.32.010 includes school districts, educational service districts, the state school for the deaf, and the state school for the blind but does not include the office of the superintendent of public instruction.

(b) As applied to ((other)) TRS employers other than those listed in (a) of this subsection, "public school" means an institution, fifty percent or more of whose employees are "qualified to teach," whose primary function is to educate students. See subsection (8) of this section.

(((7))) (8) Qualified to teach as used under RCW 41.32.010(29) means ((either)):

(a) Having ((the authority to provide instruction at a common school as defined under RCW 28A.150.020 pursuant to:

(i))) a valid ((teaching)) certificate issued by the office of the superintendent of public instruction ((under WAC 180-75-055; or

(ii) A)) pursuant to WAC 180-79A-140;

(b) Having a valid permit to teach issued by a lawful authority of this state ((under RCW 28A.405.010)) pursuant to WAC 180-79A-128; or

(((b))) (c) Being employed under a contract to teach with an institution of higher education as defined in RCW ((28A.150.020)) 28B.10.016.

(((8) Reportable compensation means earnable compensation as that term is defined in RCW 41.32.010(10).))

(9) Service in an administrative or supervisory capacity as used under RCW 41.32.010 and in this chapter:

(a) Means:

(i) Service in a managerial role relating to the administration of a public school; or

(ii) Service involving the exercise of direction over employees of the public school.

(b) Includes, but is not limited to, service as: Principal, assistant principal, superintendent, assistant superintendent, personnel manager and business manager.

(10) ((Service in an instructional capacity means a qualified teacher performing services as a classroom teacher.

(11))) Spousal consent requires written evidence that the married member's spouse consents to the retirement option selected by the member. The spouse's notarized signature on the retirement application, duly executed and filed with the department, constitutes "written evidence."

(((12))) (11) System acronyms used in this chapter are defined as follows:

"PERS" means the public employees' retirement system.

"SERS" means the school employees' retirement system.

"TRS" means the teachers' retirement system.

[Statutory Authority: RCW 41.50.050(5). 04-21-080, 415-112-015, filed 10/20/04, effective 11/20/04. Statutory Authority: RCW 41.50.050(5) and chapter 41.32 RCW. 02-18-046, 415-112-015, filed 8/28/02, effective 9/30/02. Statutory Authority: RCW 41.50.050. 95-16-053, 415-112-015, filed 7/25/95, effective 8/25/95. Statutory Authority: RCW 41.50.050 and Bowles v. Retirement Systems, 121 Wn.2d 52 (1993). 94-11-009, 415-112-015, filed 5/5/94, effective 6/5/94. Statutory Authority: RCW 41.32.345 and 41.50.050. 93-20-021, 415-112-015, filed 9/24/93, effective 10/25/93.]


AMENDATORY SECTION(Amending WSR 95-16-053, filed 7/25/95, effective 8/25/95)

WAC 415-112-119   Purpose and scope of eligibility rules.   WAC 415-112-120 through ((415-112-155)) 415-112-156 codifies the department's existing interpretation of statutes and existing administrative practice regarding eligibility for membership in TRS Plans ((I and Plan II)) 1, 2 and 3. The department has applied and will apply these rules to determine eligibility for ((service)) membership occurring prior to the effective dates of these sections.

[Statutory Authority: RCW 41.50.050. 95-16-053, 415-112-119, filed 7/25/95, effective 8/25/95.]


AMENDATORY SECTION(Amending WSR 95-16-053, filed 7/25/95, effective 8/25/95)

WAC 415-112-120   ((Am I eligible to establish membership?)) What is the definition of a "teacher"?   (((1) You must be a teacher. You are eligible to establish membership as provided under WAC 415-112-125 only if you work as a teacher. You are a teacher if you are qualified to teach and work for a public school in an instructional, administrative or supervisory capacity.

(2) Nonteaching positions. Positions which do not require service in an instructional, administrative or supervisory capacity include, but are not limited to, the following: Custodian, groundskeeper, bus driver, cafeteria worker, library technician, administrative assistant, and payroll clerk.)) Only teachers are eligible to establish membership in TRS.

(1) A teacher is a person who:

(a) Is qualified to teach under WAC 415-112-015(8); and is employed by a public school in an instructional, administrative, or supervisory capacity; or

(b) Otherwise meets the criteria in RCW 41.32.010(29).

(2) For example, persons employed in the following positions are included in the definition of teacher:

(a) Classroom teacher;

(b) Superintendent and assistant superintendent;

(c) Principal and assistant principal;

(d) Educational staff associate (see WAC 415-112-122);

(e) School librarian;

(f) Program administrator;

(g) School doctor.

(3) For example, persons employed in the following positions are not included in the definition of teacher:

(a) Custodian, bus driver, or cafeteria worker;

(b) Library technician;

(c) Administrative assistant or payroll clerk.

[Statutory Authority: RCW 41.50.050. 95-16-053, 415-112-120, filed 7/25/95, effective 8/25/95.]


NEW SECTION
WAC 415-112-122   Am I eligible for TRS membership if I am an educational staff associate?   (1) For the purposes of this chapter, you are considered a teacher and are eligible for TRS membership if you:

(a) Possess a valid educational staff associate certificate issued by the office of the superintendent of public instruction under chapter 180-79A WAC; and

(b) Serve in an educational staff associate position in a public school consistent with subsection (2) of this section.

(2) Educational staff associate positions include, but are not limited to: Communications disorder specialist, occupational therapist, physical therapist, reading resource technician, school counselor, school nurse, school psychologist, school social worker and school librarian. Educational staff associate positions do not include positions such as custodian, groundskeeper, bus driver, cafeteria worker, library technician, administrative assistant, payroll clerk or any other position that does not require service in an instructional, administrative or supervisory capacity.

(3) If you established service credit in PERS prior to June 7, 1984, in an educational staff associate position, and were employed as such on or after June 7, 1984, you may transfer your membership to TRS within the time limits established in RCW 41.32.032.

(4) If you were enrolled in PERS prior to June 7, 1984, based on employment as an educational staff associate, and were converted to SERS membership under RCW 41.40.750, you may transfer your membership to TRS within the time limits established in RCW 41.32.032.

[]


AMENDATORY SECTION(Amending WSR 04-21-080, filed 10/20/04, effective 11/20/04)

WAC 415-112-125   If I am eligible, how can I establish membership?   (((1))) If you ((met)) are a teacher as defined in WAC 415-112-120 and meet the conditions in the following table, you established TRS membership. Your plan status depends upon the date you established membership, as indicated in the following table:


((Period of Service Type of Employment Plan
Prior to 10/01/771/ If you were contracted to teach full-time you were mandated into membership.

If you were employed under a less than full-time contract and you exercised your option to establish membership prior to 10/01/77, you had the option to apply for membership under RCW 41.32.240, if you worked 90 or more full-time days 2/ during a fiscal year.

Plan 1
10/01/77 through 06/06/90 If you were contracted to teach full-time you were required to be a member.

If you were employed as a substitute teacher or under a less than full-time contract, you have the option to apply for membership under RCW 41.32.240 if you worked a minimum of 90 full-time days 2/ during a fiscal year, provided 1 month had at least 90 hours.

Plan 2
6/07/90

through 08/31/91

You must have been employed in an eligible position as defined in Section 2, Chapter 274, Laws of 1990, (requiring two or more consecutive months of at least 90 hours of compensated employment each month during an annual period September through August).

For substitute teachers: If you met the above criteria, you may apply for membership and service credit under RCW 41.32.013 and WAC 415-112-140.

Plan 2
9/01/91

forward

You must be employed in an eligible position (requiring at least 5 months of 70 hours or more of compensated employment each month during an annual period September through August).

For substitute teachers: If you meet the above criteria, you may apply for membership/service credit under RCW 41.32.013 and WAC 415-112-140.

Plan 2
7/01/96 You must be employed in an eligible position (requiring at least 5 months of 70 hours or more of compensated employment each month during an annual period September through August).


For substitute teachers: If you meet the above criteria, you may apply for membership/service credit under RCW 41.32.013 and WAC 415-112-140.

Plan 3))

1/ If you previously established Plan 1 membership as detailed above, you may reestablish Plan 1 membership after October 1, 1977.

2/ "Ninety days of employment,” under RCW 41.32.240 and this section means either:

(a) Ninety full-time calendar days, or the equivalent, during a fiscal year if you were employed as a teacher under a contract; or

(b) Ninety full-time days of actual, compensated service, or the equivalent, during a fiscal year if you were employed as a substitute teacher.

(c) The "equivalent” of a full-time day of employment under (a) and (b) of this subsection is the sum of partial days which, when added together, equals one full-time day.


(2) Defined terms used. Definitions for the following terms used in this section may be found in the sections listed.

(a) "Member" - RCW 41.32.010.

(b) "Eligible position" - RCW 41.32.010.

(c) "Employer" - RCW 41.32.010.

(d) "Full-time" - RCW 41.32.240

(e) "Service" - RCW 41.32.010.

(f) "Substitute teacher" - RCW 41.32.010.

(g) "Teacher" - RCW 41.32.010.))


Period of Service Type of Employment Plan
Prior to 10/01/771/ (1) You were mandated into membership, if:


(a) You were contracted to teach full time, as defined in RCW 41.32.240; and

Plan 1
(b) You were employed for ninety calendar days.
(2) If you were employed less than full time, you were a member if you:
(a) Worked the equivalent of ninety or more full-time days2/ during a fiscal year; and
(b) Established membership under RCW 41.32.240 prior to 10/01/77.
10/01/77 through 06/06/90 (1) If you were contracted to teach full time, you were required to be a member.


(2) If you were employed as a substitute teacher or less than full time, you were a member if you:

Plan 2
(a) Worked the equivalent of ninety or more full-time days2/ during a fiscal year;
(b) Worked at least ninety hours during one month; and
(c) Established membership under RCW 41.32.240.
06/07/90

through 08/31/91

(1) You were a member if you:


(a) Were employed in an eligible position as defined in RCW 41.32.010 (37)(a);

Plan 2
(b) Worked two consecutive months of ninety hours or more of compensated employment each month during an annual period September through August.
(2) If you were a substitute teacher, you were a member if you:
(a) Worked two consecutive months of ninety hours or more of compensated employment each month during an annual period September through August; and
(b) Established membership under RCW 41.32.013.
09/01/91

through 06/30/96

(1) If you were employed in an eligible position as defined in RCW 41.32.010 (37)(b), you were required to be a member.


(2) If you were employed as a substitute teacher, you were a member if you:

Plan 2
(a) Worked at least five months of seventy hours or more of compensated employment during an annual period September through August; and
(b) Established membership under RCW 41.32.013.
07/01/96 (1) If you were employed in an eligible position as defined in RCW 41.32.010 (37)(b), you were required to be a member. Plan 3
(2) If you were employed as a substitute teacher, you were a member if you:
(a) Worked at least five months of seventy hours or more of compensated employment during an annual period September through August; and
(b) Established membership under RCW 41.32.013.

1/ If you previously established Plan 1 membership as detailed above, you may reestablish Plan 1 membership after October 1, 1977.

2/ The equivalent of a full-time day is the sum of partial days, which, when added together, equal one full-time day.

[Statutory Authority: RCW 41.50.050(5). 04-21-080, 415-112-125, filed 10/20/04, effective 11/20/04. Statutory Authority: RCW 41.50.050(5) and chapter 41.32 RCW. 02-18-046, 415-112-125, filed 8/28/02, effective 9/30/02. Statutory Authority: RCW 41.50.050. 00-10-015, 415-112-125, filed 4/21/00, effective 5/22/00; 95-16-053, 415-112-125, filed 7/25/95, effective 8/25/95.]


AMENDATORY SECTION(Amending WSR 02-18-046, filed 8/28/02, effective 9/30/02)

WAC 415-112-130   If I separate from, and then reenter employment, ((can)) do I continue to participate in TRS?   (((1) If you are a TRS Plan 1 member, you will participate in TRS Plan 1 if you become reemployed with a TRS employer. If you are a Plan 1 member and have separated)) This section applies to Plan 1, 2 and 3 members who separate employment without retiring.

(1) As a Plan 1 member:

(a) If you separate from service without withdrawing contributions, you will participate in ((the system)) Plan 1 again if you become reemployed with a TRS employer, even if you are not working as a teacher as defined in WAC 415-112-120.

(((2) If you terminate TRS Plan 1 membership, you will not reenter TRS Plan 1 unless you requalify for membership or repay withdrawn contributions as a dual member. If you were a Plan 1 member and have terminated your membership, you can reestablish your membership and be eligible to participate in the system again only if you:

(a) Become reemployed as a teacher in a position or positions meeting the membership eligibility criteria under RCW 41.32.240 and WAC 415-112-125(1); or

(b) Repaid withdrawn contributions as a dual member under portability. See RCW 41.54.020(2).

(3) If you have service credit in TRS Plan 2, you will only reestablish membership if you work as a teacher in an eligible position. If you were a Plan 2 member who separated from service, you will reestablish membership and be eligible to participate in the system again only if you:

(a) Become reemployed as a teacher; and

(b) Render service in a position or positions meeting the membership eligibility criteria under WAC 415-112-125(1) or 415-112-140(1).

(4) If you have service credit in TRS Plan 3, you will only reestablish membership if you work as a teacher in an eligible position. If you were a Plan 3 member who separated from service, you will reestablish membership and be eligible to participate in the system again only if you:

(a) Become reemployed as a teacher; and

(b) Render service in a position or positions meeting the membership eligibility criteria under WAC 415-112-125(1) or 415-112-140(1).

(5) Defined terms used. Definitions for the following terms used in this section may be found in the sections listed.

(a) "Dual member" - RCW 41.54.010 and WAC 415-113-041.

(b) "Eligible position" - RCW 41.32.010.

(c) "Employer" - RCW 41.32.010.

(d) "Member" - RCW 41.32.010.

(e) "Service" - RCW 41.32.010.

(f) "Service in an administrative or supervisory capacity" - WAC 415-112-015.

(g) "Service in an instructional capacity" - WAC 415-112-0163.

(h) "Teacher" - RCW 41.32.010.)) (b) If you separate from service and withdraw your contributions, you will reestablish Plan 1 membership only if:

(i) You are a teacher, as defined in WAC 415-112-120, and meet the eligibility requirements in RCW 41.32.240; or

(ii) You are a member of another retirement system and repay your withdrawn contributions as a dual member under portability. See RCW 41.54.020(2).

(2) As a Plan 2 member: If you separate from service, you will participate in Plan 2 again if you become reemployed in an eligible TRS position with a TRS employer.

(3) As a Plan 3 member: If you separate from service, you will participate in Plan 3 again if you become reemployed in an eligible TRS position with a TRS employer.

[Statutory Authority: RCW 41.50.050(5) and chapter 41.32 RCW. 02-18-046, 415-112-130, filed 8/28/02, effective 9/30/02. Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-112-130, filed 12/12/00, effective 1/12/01. Statutory Authority: RCW 41.50.050. 95-16-053, 415-112-130, filed 7/25/95, effective 8/25/95.]


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

WAC 415-112-145   ((Can I terminate)) When does my status as a TRS member terminate?   (1) ((If you are a TRS Plan 1 member, you will remain a member until you:

(a) Die;

(b) Retire for service or disability; or

(c) Withdraw your accumulated contributions.

(2) If you are a TRS Plan 2 member, you will remain a member until you:

(a) Die;

(b) Retire for service or disability; or

(c) Separate from service as a teacher in an eligible position.

(3) If you are a TRS Plan 3 member, you will remain a member until you:

(a) Die; or

(b) Retire for service or disability.

(4) Defined terms used. Definitions for the following terms used in this section may be found in the sections listed.

(a) "Eligible position" - RCW 41.32.010.

(b) "Member" - RCW 41.32.010.

(c) "Service" - RCW 41.32.010.

(d) "Teacher" - RCW 41.32.010.)) Your TRS Plan 1 membership terminates:

(a) When you retire for service or disability;

(b) When you separate from service and withdraw your accumulated contributions; or

(c) Upon your death.

(2) Your TRS Plan 2 membership terminates:

(a) When you retire for service or disability;

(b) When you separate from service and withdraw your accumulated contributions; or

(c) Upon your death.

(3) Your TRS Plan 3 membership terminates:

(a) When you retire for service or disability;

(b) When you separate from service, withdraw your accumulated contributions, and irrevocably waive your one percent defined benefit according to the provisions of WAC 415-112-150; or

(c) Upon your death.

[Statutory Authority: RCW 41.50.050. 00-10-015, 415-112-145, filed 4/21/00, effective 5/22/00; 95-16-053, 415-112-145, filed 7/25/95, effective 8/25/95.]


AMENDATORY SECTION(Amending Order IV, filed 2/15/78)

WAC 415-112-240   ((Service credit to be retroactive.)) In TRS Plan 1, do I receive service credit for my first ninety days of service?   In TRS Plan 1, the service ((rendered)) you provide during the ninety days of ((employment or the ninety days of)) service required to establish membership after July 1, 1964, ((shall qualify)) qualifies as creditable service after you establish membership ((has been established, except as to Plan II members)).

[Statutory Authority: RCW 41.50.050(6) and 41.50.090. 78-03-023 (Order IV), 415-112-240, filed 2/15/78. Formerly WAC 462-20-025.]


AMENDATORY SECTION(Amending WSR 02-03-120, filed 1/23/02, effective 3/1/02)

WAC 415-112-250   ((Can)) Will I receive service credit for leave with pay?   (1) Plan 1 members: If you are otherwise eligible, you will receive service credit for any time ((on or after July 1, 1960, during which)) you were on official leave from your position on or after July 1, 1960, provided that:

(a) You were listed as employed by your employer; and

(b) You were receiving compensation from your employer for the time of your leave.

(2) Plan 2 members: You may receive service credit in accordance with RCW 41.32.810(((1))).

(3) Plan 3 members: You may receive service credit in accordance with RCW 41.32.865(((1))).

[Statutory Authority: RCW 41.50.050(5), 41.32.267, 41.32.810, 41.32.850. 02-03-120, 415-112-250, filed 1/23/02, effective 3/1/02. Statutory Authority: RCW 41.50.050(6) and 41.50.090. 78-03-023 (Order IV), 415-112-250, filed 2/15/78. Formerly WAC 462-20-030.]


AMENDATORY SECTION(Amending Order IV, filed 2/15/78)

WAC 415-112-260   ((Credit)) How is service credit evaluated for service in higher institutions((.))?   Service credit for teaching in public higher educational institutions ((shall be)) is evaluated ((under the same rules and regulations as apply to service credit in public common schools)) according to RCW 41.32.270 (Plan 1) and RCW 41.32.010 (26)(b) (Plans 2 and 3).

[Statutory Authority: RCW 41.50.050(6) and 41.50.090. 78-03-023 (Order IV), 415-112-260, filed 2/15/78. Formerly WAC 462-20-035.]


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

WAC 415-112-270   ((Evaluating)) In TRS Plan 1, may I receive service credit for professional preparation((.))?   ((If)) As a TRS Plan 1 member ((is otherwise eligible, professional preparation credit may be allowed)), you may be eligible for service credit for additional study at an institution of higher learning((,)) or ((at)) a commercial or technical school where the courses supplement ((the member's)) your professional preparation.

The department considers thirty-six quarter hours or twenty-four semester hours of credit, or the equivalent, ((shall be considered a year's work. Any less credits shall be evaluated as a fractional part of a year)) as one year of service credit. Fewer academic credits may be converted into a fraction of a year of service credit.

[Statutory Authority: RCW 41.50.050. 99-14-008, 415-112-270, filed 6/24/99, effective 7/25/99. Statutory Authority: RCW 41.50.050(6) and 41.50.090. 78-03-023 (Order IV), 415-112-270, filed 2/15/78. Formerly WAC 462-20-040.]


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

WAC 415-112-290   May I purchase service credit for out-of-state ((service.)) teaching?   (1) ((A TRS Plan 1 member who leaves Washington public school service and terminates his membership in the teachers' retirement system by lapsation or withdrawal and who subsequently returns to service and membership may establish or reestablish only such credit for out-of-state service as may be credited under the laws in effect at the time when he reestablishes membership.

(2) Effective July 1, 1964, a new or former TRS Plan 1 member who returns to membership after his former membership was cancelled by lapsation or withdrawal may not establish or reestablish out-of-state prior service credit of any kind, including out-of-state prior service credit for teaching, professional preparation, or military service.

(3) Out-of-state membership service credit, regardless of when the service was rendered, may be established or reestablished after July 1, 1964, within the limitations of existing law, only if the out-of-state service was rendered while the member was on official leave of absence granted by a state of Washington employer.)) Do I qualify to purchase service credit for out-of-state teaching?

(a) Plan 1. If you are a Plan 1 member, you may establish service credit for teaching out-of-state, which includes teaching out of the country, only if:

(i) You were on an official leave of absence granted by your employer when you provided the service; and

(ii) You returned to public school service in Washington state.

(b) Plans 2 and 3. If you are a Plan 2 or 3 member, you may not purchase service credit for out-of-state teaching.

(2) As a Plan 1 member, how do I apply to purchase service credit for out-of-state teaching? To establish such service credit, you must submit the following to the department within the time limits set in RCW 41.32.310:

(a) Proof of your out-of-state service;

(b) Proof of your official leave of absence; and

(c) Payment of contributions.

(3) What is the maximum amount of service credit I may purchase? If you meet the requirements in this section, you may establish a maximum of four years of service credit for teaching out-of-state. Except that, at the time of retirement, you may not have more years of service credit for out-of-state teaching than for Washington state service, unless you established the out-of-state service credit prior to July 2, 1947.

[Statutory Authority: RCW 41.50.050. 99-14-008, 415-112-290, filed 6/24/99, effective 7/25/99. Statutory Authority: RCW 41.50.050(6) and 41.50.090. 78-03-023 (Order IV), 415-112-290, filed 2/15/78. Formerly WAC 462-20-055.]


AMENDATORY SECTION(Amending Order IV, filed 2/15/78)

WAC 415-112-300   ((Red Cross service.)) What types of service do not qualify for TRS service credit?   Service credit ((shall not be allowed)) is not earned for service:

(1) With the National Red Cross organization;

(2) As a teacher or educational advisor in the Civilian Conservation Corps camps; or

(3) As a Peace Corps volunteer.

[Statutory Authority: RCW 41.50.050(6) and 41.50.090. 78-03-023 (Order IV), 415-112-300, filed 2/15/78. Formerly WAC 462-20-060.]


NEW SECTION
WAC 415-112-401   What types of payments are considered earnable compensation?   The following table indicates whether certain types of payments are earnable compensation under TRS Plan 1, 2 or 3 and provides a cross-reference to the specific WAC.

Type of Payment TRS 1 Earnable Compensation? TRS 2/3 Earnable Compensation?
Annual Leave Cash Outs Yes - WAC 415-112-415 No - WAC 415-112-415
Base Contract Yes - WAC 415-112-4601 Yes - WAC 415-112-4601
Car Allowances No - WAC 415-112-413011 No - WAC 415-112-41301
Cafeteria Plans Yes - WAC 415-112-4604 Yes - WAC 415-112-4604
Deferred Wages Yes - WAC 415-112-4609 Yes - WAC 415-112-4609
Disability Payments No - WAC 415-112-482 No - WAC 415-112-482
Employer Provided Vehicle No - WAC 415-112-4132 No - WAC 415-112-413
Employer Taxes/Contributions No - WAC 415-112-4609 No - WAC 415-112-4609
Evening/Summer School Yes - WAC 415-112-4601 Yes - WAC 415-112-4601
Extracurricular Contracts Yes - WAC 415-112-4601 Yes - WAC 415-112-4601
Fringe Benefits, including insurance No - WAC 415-112-480 No - WAC 415-112-480
Illegal Payments No - WAC 415-112-485 No - WAC 415-112-485
Legislative Leave Yes - WAC 415-112-471 Yes - WAC 415-112-471
Longevity/Education Attainment Pay Yes - WAC 415-112-4601 Yes - WAC 415-112-4601
National Board of Professional Teaching Standards Certification Bonus No - WAC 415-112-4602 No - WAC 415-112-4602
Nonmoney Maintenance Yes - WAC 415-112-4123 No - WAC 415-112-412
Optional Payments No - WAC 415-112-487 No - WAC 415-112-487
Performance Bonuses Yes - WAC 415-112-4603 Yes - WAC 415-112-4603
Retroactive Salary Increase Yes - WAC 415-112-4607 Yes - WAC 415-112-4607
Reimbursements No - WAC 415-112-489 No - WAC 415-112-489
Reinstatement Payments Yes - WAC 415-112-477 Yes - WAC 415-112-477
Retirement or Termination Bonuses No - WAC 415-112-490 No - WAC 415-112-490
Severance Pay - Earned Over Time Yes - WAC 415-112-4608 No - WAC 415-112-4608
Severance Pay - Not Earned Over Time No - WAC 415-112-491 No - WAC 415-112-491
Sick Leave Cash Outs No - WAC 415-112-417 No - WAC 415-112-417
Supplemental Contracts Yes - WAC 415-112-4601 Yes - WAC 415-112-4601
Time Off with Pay Yes - WAC 415-112-473 Yes - WAC 415-112-473
Union Leave4 Yes - WAC 415-112-475 Yes - WAC 415-112-475
Workers' Compensation No - WAC 415-112-482 No - WAC 415-112-482

1A portion of the value of an employer car allowance may be reportable in Plan 1 only. See WAC 415-112-41301.

2A portion of the value of an employer provided vehicle may be reportable in Plan 1 only. See WAC 415-112-413.

3A portion of the value of nonmoney maintenance provided may be reportable in Plan 1 only. See WAC 415-112-412.

4Only specific types of union leave are reportable. See WAC 415-112-475.

[]


NEW SECTION
WAC 415-112-402   What is earnable compensation?   (1) The department determines whether payments to an employee are earnable compensation based on the nature of the payment, not the name of the payment. The department considers the reason for the payment and whether the reason brings the payment within the statutory definition of earnable compensation.

(2) Earnable compensation must meet the definition in RCW 41.32.010(10). It must:

(a) Be paid by a TRS employer to an employee as salary or wages for services provided; or

(b) Qualify as earnable compensation under WAC 415-112-471 through 415-112-477, even though it was not paid for services provided. See RCW 41.32.010(10), 41.32.267, 41.32.810 and 41.32.865.

(3) In certain cases you may establish service credit for out-of-state teaching, military service, and professional preparation. However, any compensation you may have received for these periods is excluded from earnable compensation because it is not salary or wages from a TRS employer.

(4) Some types of compensation are defined as earnable compensation in one plan and not in another.

(5) An employer must report all of an employee's earnable compensation to the department. An employer must report compensation for the month in which it was earned. Compensation is earned when the service is provided, rather than when payment is made.


Example: A member is paid in July for work performed during June. The employer must report the compensation to the department as "June earnings."

[]


AMENDATORY SECTION(Amending WSR 02-03-120, filed 1/23/02, effective 3/1/02)

WAC 415-112-412   Are nonmoney payments from my employer ((considered compensation)) earnable compensation?   (1) ((TRS Plan 1 members:

(a) If your employer provides you with materials in lieu of reimbursement for your business expenses, the value of the materials is not earnable compensation.

(i) The value of employer-provided materials is not earnable compensation if you use the materials solely in connection with your employer's business.

(ii) "Materials" includes, but is not limited to, living quarters, food, board, equipment, clothing, laundry, transportation, fuel, and utilities:


Example: An employer provides an employee with uniforms which the employee must wear in performing services for his employer. Because the uniforms are to be used solely in connection with the employer's business, they do not qualify as nonmoney maintenance compensation. Therefore, the value of the uniforms is not earnable compensation.

(b) The department presumes that your employer provides you materials solely in lieu of reimbursement for business expenses. Unless you or your employer can show by corroborating evidence that your employer provided you materials in whole or in part as payment for your personal expenses, as opposed to business expenses, the value of the materials is not earnable compensation.

(c) If your employer provides you with materials for your personal use, the value of that use is nonmoney maintenance compensation and is included in your earnable compensation.

(i) "Nonmoney maintenance compensation" means the fair market value of materials legally provided by your employer to you or your dependents for personal use.

(ii) Nonmoney maintenance compensation does not include any form of compensation other than cash that is excludable from taxation under provisions of the Internal Revenue Code. This applies regardless of whether you or your employer reported the compensation to the Internal Revenue Service as taxable income.

(d) Your use of employer-provided materials will qualify as nonmoney maintenance compensation if your employer substantiates that they were provided to you as payment for personal services. In order for employer-provided materials to qualify as nonmoney maintenance compensation, your employer must:

(i) Establish and regularly update a written schedule reflecting the monthly fair market value of each item of employer-provided materials claimed as nonmoney maintenance compensation. Typically, the fair market value would be the cost of the item if it were acquired in a purchase or lease transaction;

(ii) Report the fair market value of employer-provided materials as nonmoney maintenance compensation to the department as earnable compensation. If you pay any amount to your employer in order to own or use the materials, your employer must report as earnable compensation the amount by which the fair market value of the materials exceeds the amount of your payment;

(iii) Substantiate by adequate records, or by other sufficient corroborating evidence the following:

(A) That the fair market value of each item of nonmoney maintenance compensation as reported to the department is accurate;

(B) That each item of nonmoney maintenance compensation is provided to you for your personal use as payment for your services to the employer; and

(C) That each item of nonmoney maintenance compensation is includable in your taxable income for federal income tax purposes.


Example: An employer leases an apartment for $700.00 per month. The employer charges an employee $300.00 per month to use the apartment for temporary living quarters. Because the employee uses the apartment for personal, rather than business, purposes, the amount by which the lease value exceeds the employee's payment is nonmoney maintenance compensation. The employer must report $400.00 per month to the department as earnable compensation for the employee.

(e) How to corroborate that your use of employer-provided materials qualifies as nonmoney maintenance compensation. In addition to the records required under (d) of this subsection, you may provide the department with any evidence which you or your employer believe confirms that your use of employer-provided materials qualifies as earnable compensation. However, verbal evidence alone has considerably less value than written evidence. Written evidence prepared at or near the time your employer provides you with the item of compensation is generally much stronger than verbal evidence or written evidence created years later.

(2) TRS Plan 2 and Plan 3 members. If you are a TRS Plan 2 or Plan 3 member, you are not entitled to count the value of any nonmoney maintenance compensation you receive from your employer as earnable compensation.)) Nonmoney maintenance compensation, as defined in this section:

(a) Is earnable compensation to the extent authorized by this section, for Plan 1 members; and

(b) Is not earnable compensation for Plan 2 and 3 members.

(2) Nonmoney maintenance compensation is compensation legally provided to you in a form other than money. For example, nonmoney maintenance compensation may include the provision of materials such as living quarters, food, board, equipment, clothing, laundry, transportation, fuel, and utilities. To be considered nonmoney maintenance compensation, the materials must be provided for your personal use and/or the personal use of your dependents, not for a business use. The materials are not nonmoney maintenance compensation if:

(a) You use them solely in connection with your employer's business; or

(b) They are provided in lieu of reimbursement for your business expenses.

(3) To prove that the provision of materials constitutes nonmoney maintenance compensation:

(a) Your employer must substantiate by adequate records or other sufficient corroborating evidence that the materials were provided to you for your personal use as payment for your services to the employer.

(b) Your employer must substantiate that the fair market value of the materials provided is includable in your taxable income for federal income tax purposes.

(c) You may provide corroborating evidence to the department. Written documentation prepared at or near the time the materials were provided is generally preferred.

(d) In the absence of clear proof, the department will presume that employer-provided materials were not nonmoney maintenance compensation.

(4) If you are a member of TRS Plan 1, your employer must report nonmoney maintenance compensation to the department as earnable compensation. The amount reported as earnable compensation is the fair market value of materials legally provided by your employer. To substantiate the value of nonmoney maintenance compensation:

(a) Your employer must establish and regularly update a written schedule reflecting the monthly fair market value of the materials provided. Typically, the fair market value would be the cost of the item if it were acquired in a purchase or lease transaction. Your employer must be able to substantiate the accuracy of this schedule with adequate records.

(b) If you pay any amount to your employer in order to own or use the materials, your employer must report as earnable compensation the amount by which the fair market value exceeds the amount of your payment.

[Statutory Authority: RCW 41.50.050(5) and 41.32.010 (10)(b). 02-03-120, 415-112-412, filed 1/23/02, effective 3/1/02. Statutory Authority: RCW 41.50.050. 95-22-006, 415-112-412, filed 10/18/95, effective 11/18/95. Statutory Authority: RCW 41.32.010(11) and 41.32.160. 87-17-060 (Order DRS 87-07), 415-112-412, filed 8/19/87.]


REPEALER

     The following sections of the Washington Administrative Code are repealed:
WAC 415-112-020 Public records.
WAC 415-112-100 Minimum requirement for membership.
WAC 415-112-135 Can I be a member if I work as an educational staff associate?
WAC 415-112-310 Civilian Conservation Corps service.
WAC 415-112-320 Service as a Peace Corps volunteer.
WAC 415-112-444 Purpose and scope of earnable compensation rules.
WAC 415-112-445 TRS reportable compensation table.
WAC 415-112-450 What compensation can be reported?
WAC 415-112-460 Payments for services rendered.
WAC 415-112-470 Payments not for services rendered.

Washington State Code Reviser's Office