WSR 05-12-043

PERMANENT RULES

DEPARTMENT OF

RETIREMENT SYSTEMS

[ Filed May 25, 2005, 2:33 p.m. , effective June 25, 2005 ]


Purpose: These rules are being amended to delete obsolete provisions, correct statutory citations, and implement current law. WAC 415-112-840 is repealed and the amended version is adopted as WAC 415-112-544 to improve the organization and accessibility of rules in chapter 415-112 WAC.

Citation of Existing Rules Affected by this Order: Repealing WAC 415-112-840; and amending WAC 415-104-111, 415-108-830, and 415-110-830.

Statutory Authority for Adoption: For WAC 415-104-111 is RCW 41.50.050(5), 41.26.500; for WAC 415-108-830 is RCW 41.50.050(5), 41.40.690, 41.40.850; for WAC 415-110-830 is RCW 41.50.050(5), 41.35.230; and for WAC 415-112-544 is RCW 41.50.050(5), 41.32.800, 41.32.860.

Other Authority: For WAC 415-104-111 is RCW 41.26.500; for WAC 415-108-830 is RCW 41.40.690, 41.40.850, 41.40.037; for WAC 415-110-830 is RCW 41.35.230, 41.35.060; and for WAC 415-112-544 is RCW 41.32.800, 41.32.802, 41.32.860, 41.32.862.

Adopted under notice filed as WSR 05-08-033 on March 30, 2005.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

Number of Sections Adopted on the Agency's Own Initiative: New 1, Amended 3, Repealed 1.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 1, Amended 3, Repealed 1.

Date Adopted: May 25, 2005.

Sandra J. Matheson

Director

OTS-7884.2


AMENDATORY SECTION(Amending WSR 02-14-072, filed 6/28/02, effective 7/29/02)

WAC 415-104-111   ((Actuarial recomputation of retirement allowance upon retirement following reemployment.)) How does the department calculate the retirement allowance of a LEOFF Plan 2 member who retires, reenters employment, and then either retires or separates employment again?   (((1) The purpose of this rule is to establish)) This rules establishes a method to actuarially recompute ((the)) your retirement allowance ((of)) if you are a Plan 2 member who retires, reenters employment causing ((his or her)) your retirement allowance to be suspended, and then either retires or separates employment again. ((The actuarially recomputed retirement allowance shall:

(a) Include service credit the member earned following reestablishment of membership if any; and

(b) Account for the actuarial reduction applied to the member's initial retirement if the member initially retired prior to age fifty-three.

(2) If a Plan 2 retiree reenters membership, upon the individual's next retirement, the department shall reinstate and actuarially recompute the individual's retirement allowance pursuant to RCW 41.26.500 as follows:)) (1) If you return to employment in a LEOFF eligible position, you must reenter membership.

(a) If ((the member first)) you previously retired before age fifty-three, the department ((shall)) will:

(i) Calculate ((the)) your retirement allowance pursuant to RCW 41.26.420 using ((the retiree's)):

(A) Your total years of career service, including service earned prior to your initial retirement and service earned after reentering membership; and

(B) Any increase in your final average salary resulting from your reentry into membership; and

(ii) Actuarially reduce ((the member's)) your retirement allowance:

(A) Based on the present value of the retirement allowance payments ((the individual)) you received during ((the)) your initial retirement; ((and

(iii) Calculate any survivor option selected by the retiree based upon the monthly retirement allowance calculated pursuant to (a)(i) and (ii) of this subsection.)) (B) To reflect the difference in the number of years between your current age and the attainment of age fifty-three, if applicable; and

(C) To offset the cost of your benefit option if it includes a survivor feature. See WAC 415-104-215.

(b) If ((the member initially)) you previously retired at or after age fifty-three, the department ((shall)) will recompute ((the member's)) your retirement allowance pursuant to RCW ((41.26.500)) 41.26.420 and include any additional service credit you earned and any ((applicable)) increase in ((the member's)) your final average ((final compensation)) salary resulting from ((the member's)) your reentry into membership. The department will actuarially reduce your retirement allowance to offset the cost of your benefit option if it includes a survivor feature. See WAC 415-104-215.

(c) Under no circumstances ((shall a retiree)) will you receive a retirement allowance creditable to a month during which ((that individual)) you earned service credit.

(((3) If a retiree's retirement allowance is suspended under RCW 41.26.500 due to reemployment but the retiree does not reenter membership, upon the retiree's separation from such employment, the retiree shall receive an actuarially recomputed retirement allowance equal to the sum of:

(a) The amount of the monthly suspended retirement allowance; plus

(b) An actuarially computed increase based upon the retirement allowance payment the member did not receive due to reemployment. The retiree may elect to receive the actuarially computed increase in either:

(i) An amount amortized over the expected term of the recomputed retirement allowance; or

(ii) A lump sum payment equal to the suspended retirement allowance plus interest.)) (2) If you enter employment in a PERS, TRS or SERS eligible position, whether or not you enter PERS, TRS or SERS membership, your LEOFF retirement allowance will be suspended under RCW 41.26.500. Upon separation from such employment, your suspended retirement allowance will be reinstated. In addition, you may choose to have the total monthly retirement payments you would have received had you not reentered employment, plus interest, either:

(a) In a lump sum; or

(b) Actuarially computed in your retirement allowance.

[Statutory Authority: RCW 41.50.050(5), 41.26.470, 2001 c 261. 02-14-072, 415-104-111, filed 6/28/02, effective 7/29/02. Statutory Authority: RCW 41.50.050. 94-09-040, 415-104-111, filed 4/19/94, effective 5/20/94.]

OTS-7885.2


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

WAC 415-108-830   ((Actuarial recomputation of a Plan 2 or Plan 3 retirement allowance upon retirement following reemployment.)) How does the department calculate the retirement allowance of a PERS Plan 2 or Plan 3 member who retires, reenters PERS membership, and then retires again?   (((1))) This rule establishes a method to actuarially recompute ((the)) your defined benefit retirement allowance ((of)) if you are a Plan 2 or Plan 3 member who retires, reenters ((employment)) PERS membership causing ((the)) your retirement allowance to ((be suspended)) stop, and then retires again. ((The actuarially recomputed retirement allowance shall:

(a) Include service credit the member earned following reestablishment of membership if any; and

(b) Account for the actuarial reduction applied to the member's initial retirement if the member initially retired prior to age sixty-five.

(2) If a Plan 2 or Plan 3 retiree reenters membership, upon the individual's next retirement, the department shall reinstate and actuarially recompute the individual's retirement allowance pursuant to RCW 41.40.690 as follows:

(a))) (1) If ((the member first)) you previously retired before age sixty-five, the department ((shall)) will:

(((i) Calculate the)) (a) Recompute your retirement allowance pursuant to RCW 41.40.620 (Plan 2) or 41.40.790 (Plan 3) using ((the retiree's)):

(i) Your total years of career service, including service earned prior to your initial retirement and service earned after reentering membership; and

(ii) Any increase in your average final compensation resulting from your reentry into membership; and

(b) Actuarially reduce ((the member's)) your retirement allowance:

(i) Based on the present value of the retirement allowance payments ((the individual)) you received during ((the)) your initial retirement; ((and))

(ii) To reflect the difference in the number of years between your current age and the attainment of age sixty-five, if applicable; and

(iii) ((Calculate any survivor option selected by the retiree based upon the monthly retirement allowance calculated pursuant to (a)(i) and (ii) of this subsection.

(b))) To offset the cost of your benefit option if it includes a survivor feature. See WAC 415-108-326.

(2) If ((the member initially)) you previously retired at or after age sixty-five, the department ((shall)) will recompute ((the member's)) your retirement allowance pursuant to RCW 41.40.620 (Plan 2) or 41.40.790 (Plan 3) and include any additional service credit you earned and any ((applicable)) increase in ((the member's)) your average final compensation resulting from ((the member's)) your reentry into membership. The department will actuarially reduce your retirement allowance to offset the cost of your benefit option if it includes a survivor feature. See WAC 415-108-326.

(3) Under no circumstances ((shall a retiree)) will you receive a retirement allowance creditable to a month during which ((that individual)) you earned service credit.

(((3) If a Plan 2 or Plan 3 retiree's retirement allowance is suspended under RCW 41.40.690 or 41.40.850 due to reemployment but the retiree does not reenter membership, upon the retiree's separation from such employment, the retiree shall receive an actuarially recomputed retirement allowance equal to the sum of:

(a) The amount of the monthly suspended retirement allowance; plus

(b) An actuarially computed increase based upon the retirement allowance payments the member did not receive due to reemployment. The retiree may elect to receive the actuarially computed increase in either:

(i) An amount amortized over the expected term of the recomputed retirement allowance; or

(ii) A lump sum payment equal to the suspended retirement allowance plus interest.))

[Statutory Authority: RCW 41.50.050(5), 41.40.620, 41.40.690. 02-03-120, 415-108-830, filed 1/23/02, effective 3/1/02; Recodified as 415-108-830. 97-19-035, filed 9/9/97, effective 9/9/97. Statutory Authority: RCW 41.50.050. 94-09-040, 415-108-580, filed 4/19/94, effective 5/20/94.]

OTS-7886.2


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

WAC 415-110-830   ((Actuarial recomputation of retirement allowance upon retirement following reemployment.)) How does the department calculate the retirement allowance of a SERS Plan 2 or Plan 3 member who retires, reenters SERS membership, and then retires again?   (((1) The purpose of)) This rule ((is to establish)) establishes a method to actuarially recompute ((the)) your defined benefit retirement allowance ((of)) if you are a Plan 2 or Plan 3 member ((or the defined benefit retirement allowance of a Plan 3 member)) who retires, reenters ((employment causing his or her)) SERS membership causing your retirement allowance to ((be suspended)) stop, and then retires again. ((The actuarially recomputed retirement allowance shall:

(a) Include service credit the member earned following reestablishment of membership if any; and

(b) Account for the actuarial reduction applied to the member's initial retirement if the member initially retired prior to age sixty-five.

(2) If a Plan 2 or Plan 3 retiree reenters membership, upon the individual's next retirement, the department shall reinstate and actuarially recompute the individual's retirement allowance pursuant to RCW 41.35.230 (Plan 2) or RCW 41.35.640 (Plan 3) as follows:

(a))) (1) If ((the member first)) you previously retired before age sixty-five, the department ((shall)) will:

(((i) Calculate the)) (a) Recompute your retirement allowance pursuant to RCW 41.35.400 (Plan 2) or RCW 41.35.620 (Plan 3) using ((the retiree's)):

(i) Your total years of career service, including service earned prior to your initial retirement and service earned after reentering membership; and

(ii) Any increase in your average final compensation resulting from your reentry into membership; and

(b) Actuarially reduce ((the member's)) your retirement allowance:

(i) Based on the present value of the retirement allowance payments ((the individual)) you received during ((the)) your initial retirement; ((and))

(ii) To reflect the difference in the number of years between your current age and the attainment of age sixty-five, if applicable; and

(iii) ((Calculate any survivor option selected by the retiree based upon the monthly retirement allowance calculated pursuant to (a)(i) and (ii) of this subsection.

(b))) To offset the cost of your benefit option if it includes a survivor feature. See WAC 415-110-326.

(2) If ((the member initially)) you previously retired at or after age sixty-five, the department ((shall)) will recompute ((the member's)) your retirement allowance pursuant to RCW 41.35.400 (Plan 2) or RCW 41.35.620 (Plan 3) and include any additional service credit you earned and any ((applicable)) increase in ((the member's)) your average final compensation resulting from ((the member's)) your reentry into membership. The department will actuarially reduce your retirement allowance to offset the cost of your benefit option if it includes a survivor feature. See WAC 415-110-326.

(3) Under no circumstances ((shall a retiree)) will you receive a retirement allowance creditable to a month during which ((that individual)) you earned service credit.

(((3) If a retiree's retirement allowance is suspended under RCW 41.35.450 or 41.35.640 due to reemployment but the retiree does not reenter membership, upon the retiree's separation from such employment, the retiree shall receive an actuarially recomputed retirement allowance equal to the sum of:

(a) The amount of the monthly suspended retirement allowance; plus

(b) An actuarially computed increase based upon the retirement allowance payments the member did not receive due to reemployment. The retiree may elect to receive the actuarially computed increase in either:

(i) An amount amortized over the expected term of the recomputed retirement allowance; or

(ii) A lump sum payment equal to the suspended retirement allowance plus interest.))

[Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-110-830, filed 12/12/00, effective 1/12/01.]

OTS-7887.3


NEW SECTION
WAC 415-112-544   How does the department calculate the retirement allowance of a TRS Plan 2 or Plan 3 member who retires, reenters TRS membership, and then retires again?   This rule establishes a method to actuarially recompute your defined benefit retirement allowance if you are a Plan 2 or Plan 3 member who retires, reenters TRS membership causing your retirement allowance to stop, and then retires again.

(1) If you previously retired before age sixty-five, the department will:

(a) Recompute your retirement allowance pursuant to RCW 41.32.760 (Plan 2) or 41.32.840 (Plan 3) using:

(i) Your total years of career service, including service earned prior to your initial retirement and service earned after reentering membership; and

(ii) Any increase in your average final compensation resulting from your reentry into membership; and

(b) Actuarially reduce your retirement allowance:

(i) Based on the present value of the retirement allowance payments you received during your initial retirement;

(ii) To reflect the difference in the number of years between your current age and the attainment of age sixty-five, if applicable; and

(iii) To offset the cost of your benefit option if it includes a survivor feature. See WAC 415-112-493.

(2) If you previously retired at or after age sixty-five, the department will recompute your retirement allowance pursuant to RCW 41.32.760 (Plan 2) or 41.32.840 (Plan 3) and include any additional service credit you earned and any increase in your average final compensation resulting from your reentry into membership. The department will actuarially reduce your retirement allowance to offset the cost of your benefit option if it includes a survivor feature. See WAC 415-112-493.

(3) Under no circumstances will you receive a retirement allowance creditable to a month during which you earned service credit.

[]


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 415-112-840 Actuarial recomputation of retirement allowance upon retirement following reemployment.

Washington State Code Reviser's Office