Preproposal statement of inquiry was filed as WSR 05-06-040.
Title of Rule and Other Identifying Information: WAC 415-108-443 PERS compensation earnable table, 415-108-470 Nonmoney maintenance. Are payments from my employer in any form other than money considered compensation earnable?, and 415-108-800 When do I enter retirement status?
Hearing Location(s): Department of Retirement Systems, 6835 Capitol Boulevard, Conference Room 115, Tumwater, WA, on January 25, 2006, at 1:30 p.m.
Date of Intended Adoption: January 26, 2006.
Submit Written Comments to: Leslie L. Saeger, Rules Coordinator, Department of Retirement Systems, P.O. Box 48380, Olympia, WA 98504-8380, e-mail firstname.lastname@example.org, fax (360) 753-3166, by 5:00 p.m., on January 25, 2006.
Assistance for Persons with Disabilities: Contact Leslie Saeger, Rules Coordinator, by January 17, 2006, 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 proposed amendments correct technical errors and clarify language.
Statutory Authority for Adoption: RCW 41.40.020 and 41.50.050(5).
Statute Being Implemented: Chapter 41.40 RCW.
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: Dave Nelsen, 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 affect 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.
December 16, 2005
AMENDATORY SECTION(Amending WSR 03-06-042, filed 2/27/03, effective 4/1/03)
WAC 415-108-443 PERS ((
The following table (( will help you
determine)) indicates whether certain types of payments are
(( reportable)) compensation earnable under PERS Plan(( s)) 1,
2, or 3(( . Be sure to read the referenced rule to ensure that
you have correctly identified the payment in question. The
department determines reportable compensation based upon the
nature of the payment, not the name applied to it. See WAC 415-108-445)) and provides a cross-reference to the specific
|Type of Payment||PERS 1 ((
|PERS 2 or 3
|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 415-108-4851|
|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, including insurance||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|
2A portion of the value of an employer provided vehicle may be ((
reportable)) compensation earnable in Plan 1 only. See WAC 415-108-480.
3A portion of the value of nonmoney maintenance provided may be ((
reportable)) compensation earnable in Plan 1 only. See WAC 415-108-470.
|Type of Payment||PERS 1 ((
|PERS 2 or 3
|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|
|Workers' Compensation||No - WAC 415-108-479||No - WAC 415-108-479|
[Statutory Authority: RCW 41.50.050(5) and chapter 41.40 RCW. 03-06-042, § 415-108-443, filed 2/27/03, effective 4/1/03. Statutory Authority: RCW 41.50.050(5), 41.40.010(8), chapter 41.40 RCW. 02-03-120, § 415-108-443, filed 1/23/02, effective 3/1/02. Statutory Authority: RCW 41.50.050. 98-09-059, § 415-108-443, filed 4/17/98, effective 5/18/98.]
PERS Plan I members.
(a) If your employer provides you with materials in lieu of reimbursement for your business expenses, the value of the materials is not compensation earnable.
(i) The value of employer-provided materials is not compensation earnable 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.
(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 any form of materials other than cash legally furnished by your employer to you or your dependents for personal use.
(ii) Nonmoney maintenance does not include any form of payment 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 compensation earnable. If you pay any amount to your employer in order to own or use the materials, your employer must report as compensation earnable 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.
(2) PERS Plan II members. If you are a PERS Plan II member, you are not entitled to count the value of any nonmoney maintenance compensation you receive from your employer as compensation earnable.)) Nonmoney maintenance compensation, as defined in this section:
(a) Is compensation earnable to the extent authorized by this section, for Plan 1 members; and
(b) Is not compensation earnable 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) Your employer must report nonmoney maintenance compensation to the department as compensation earnable. The amount reported as compensation earnable 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 compensation earnable the amount by which the fair market value exceeds the amount of your payment.
|Example:||Your employer leases an apartment for $700.00 per month and charges you $300.00 per month to use the apartment for temporary living quarters. Because you use the apartment for personal, rather than business purposes, the amount by which the lease value exceeds your payment is nonmoney maintenance compensation. Your employer must report $400.00 per month to the department as compensation earnable for you.|
[Statutory Authority: RCW 41.50.050. 95-22-006, § 415-108-470, filed 10/18/95, effective 11/18/95. Statutory Authority: RCW 41.40.010(8) and 41.40.020. 87-17-061 (Order DRS 87-08), § 415-108-470, filed 8/19/87.]
AMENDATORY SECTION(Amending WSR 02-02-060, filed 12/28/01, effective 1/1/02)
WAC 415-108-800 When ((
does a member of the public
employees' retirement system (PERS))) do I enter retirement
As a member of PERS, you enter(( s)) retirement status
when (( he or she)) you:
Has)) Have separated from service as defined in RCW 41.40.010(( (41))) (42);
Has)) Have no written or oral agreement to return
to employment (( prior to entering "retiree status")); and
Has)) Have applied for retirement, the accrual date
has been determined under RCW 41.40.193, 41.40.680, or
41.40.801, and (( the)) your benefit begins to accrue.
|Example:||Sally is eligible for retirement on July 1st. She submits an application on June 1st with a July 1st retirement date. Her last day of employment is June 30th and she does not have an agreement to return to work.|
|Sally's retirement date (accrual date) is July 1st and the benefit begins to accrue. The first retirement payment will be paid at the end of July. Sally entered "retiree status" effective July 1st.|
[Statutory Authority: RCW 41.50.050(5), 41.04.270, 41.26.030, 41.32.010, 41.32.025, 41.32.480, 41.32.500, 41.32.570, 41.32.765, 41.32.795, 41.32.802, 41.32.855, 41.32.860, 41.32.862, 41.35.010, 41.35.030, 41.35.060, 41.35.450, 41.35.640, 41.40.010, 41.40.023, 41.40.037, 41.40.150, 41.40.193, 41.40.680, 41.40.750, 41.40.801. 02-02-060, § 415-108-800, filed 12/28/01, effective 1/1/02.]