WSR 08-02-048

PERMANENT RULES

DEPARTMENT OF

RETIREMENT SYSTEMS

[ Filed December 27, 2007, 10:14 a.m. , effective January 27, 2008 ]


Effective Date of Rule: Thirty-one days after filing.

Purpose: The purpose of this proposal is to amend existing rules to add reference to the Washington public safety employees' retirement system (PSERS). Chapter 41.37 RCW took effect on July 1, 2006. The department needs to update its rules to reflect the implementation of this new retirement system to assist plan members, retirees, employers and agency staff.

WAC 415-10-020, 415-10-030, 415-104-111, 415-113-030, 415-113-041, 415-113-042, 415-113-065, 415-113-090, 415-115-020, and 415-115-090, to include reference to the Washington public safety employees' retirement system (PSERS).

Citation of Existing Rules Affected by this Order: Amending WAC 415-10-020, 415-10-030, 415-104-111, 415-113-030, 415-113-041, 415-113-042, 415-113-065, 415-113-090, 415-115-020, and 415-115-090.

Statutory Authority for Adoption: For WAC 415-10-020, 415-10-030, 415-104-111, 415-113-030, 415-113-041, 415-115-020 and 415-115-090 is RCW 41.50.050(5) and chapter 41.37 RCW; for WAC 415-113-042 is RCW 41.50.050(5) and 41.37.240; for WAC 415-113-065 is RCW 41.50.050(5) and 41.37.010(6); and for WAC 415-113-090 is RCW 41.50.050(5) and 41.37.210(3).

Adopted under notice filed as WSR 07-22-114 on November 7, 2007.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 10, Repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 10, Repealed 0.

Date Adopted: December 27, 2007.

Sandra J. Matheson

Director

OTS-9107.1


AMENDATORY SECTION(Amending WSR 03-15-006, filed 7/3/03, effective 8/3/03)

WAC 415-10-020   Definitions.   As used in this chapter:

(1) Average earnings means:

(a) In PERS Plan 1, TRS Plan 1 or WSPRS Plan 1: The average of your two highest consecutive years of compensation as of the date of your service credit purchase.

(b) In Plan 2 or Plan 3: The average of your five highest consecutive years of compensation as of the date of your service credit purchase.

(c) In PSERS: The average of your five highest consecutive years of compensation as of the date of your service credit purchase.

(d) In LEOFF Plan 1: The basic salary attached to your position at the date of your service credit purchase.

(2) Factors means the actuarial cost factors calculated by the state actuary and adopted by the department that are used in the formulas for calculating the cost of a service credit purchase. See WAC 415-02-370 for additional information about the service credit purchase factors.

(3) LEOFF means the law enforcement officers' and fire fighters' retirement system established under chapter 41.26 RCW.

(4) PERS means the public employees' retirement system established under chapter 41.40 RCW.

(5) PSERS means the public safety employees' retirement system established under chapter 41.37 RCW.

(6) SERS means the school employees' retirement system established under chapter 41.35 RCW.

(((6))) (7) Service credit being purchased means the number of service credit months or service credit years you are purchasing.

(((7))) (8) TRS means the teachers' retirement system established under chapter 41.32 RCW.

(((8))) (9) WSPRS means the Washington state patrol retirement system established under chapter 43.43 RCW.

(((9))) (10) Years of earlier retirement equals the number of years or fractions of years you will be able to retire earlier as a result of your purchase of service credit.

(((10))) (11) Years of service equals the total anticipated years of service you will have accrued at retirement, including the additional service credit you purchase under this section.

[Statutory Authority: RCW 41.50.050(5), 41.50.165. 03-15-006, 415-10-020, filed 7/3/03, effective 8/3/03. Statutory Authority: RCW 41.50.050(5) and chapter 41.45 RCW. 02-03-120, 415-10-020, filed 1/23/02, effective 3/1/02. Statutory Authority: Chapter 41.50 RCW. 00-22-049, 415-10-020, filed 10/27/00, effective 11/27/00. Statutory Authority: RCW 41.50.050 and 41.50.165. 97-01-014, 415-10-020, filed 12/6/96, effective 1/6/97.]


AMENDATORY SECTION(Amending WSR 03-15-006, filed 7/3/03, effective 8/3/03)

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

Service Credit Purchase Cost =

Average Earnings x Service Credit Being Purchased x Factor 1



This represents the cost of the additional retirement allowance you will receive by including the additional service credit from your purchase into your retirement benefit calculation.


Example: Purchase of additional service credit.


Ron is an active PERS Plan 2 member who currently has 18 years of service. Ron turned age 61 last month. His average earnings are $50,000. Ron would like to purchase 3 years of service that he previously withdrew but did not restore before the deadline.

The department will first determine Ron's normal retirement age to identify the appropriate factor from the Factor 1 tablei to use in the formula for calculating the service credit purchase cost. Normal retirement age (NRA) is the earliest age at which a member will be eligible to retire with unreduced benefits under the requirements of his or her system and plan. Ron's NRA will come when he is age 65 and has 21 years of serviceii. Since he is currently age 61, Ron is 4 years (48 months) to normal retirement age. So, the department will use the factor 0.2016 from the Factor 1 table, which is factor for 48 months to NRA under PERS Plan 2.

The department will then calculate the cost of purchasing the service credit using the Service Credit Purchase Cost formula:

Cost = Average Earnings x Service Credit Being Purchased x Factor 1


The cost of Ron's purchase would be calculated as follows:

Cost = $50,000 x 3 (years purchased) x 0.2016 (48 months to NRA) = $30,240


Ron's total cost to purchase 3 years of service credit is $30,240.

Footnotes to section:

iSee WAC 415-02-370.

iiRon would first qualify under the PERS Plan 2 eligibility rule of being age 65 or older with at least 5 years of service.

[Statutory Authority: RCW 41.50.050(5), 41.50.165. 03-15-006, 415-10-030, filed 7/3/03, effective 8/3/03; 02-03-120, 415-10-030, filed 1/23/02, effective 3/1/02. 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.]

OTS-1190.1


AMENDATORY SECTION(Amending WSR 06-03-096, filed 1/17/06, effective 2/17/06)

WAC 415-104-111   How is my LEOFF Plan 2 retirement allowance affected if I return to work after retirement?   This rule applies to you if you are a LEOFF 2 retiree who returns to work in an eligible LEOFF, public employees' retirement system (PERS), public safety employees' retirement system (PSERS), school employees' retirement system (SERS), or teachers' retirement system (TRS) position.

(1) If you return to employment in a LEOFF eligible position, you must reenter membership and your retirement allowance will stop. When you separate from service, the department will calculate your retirement allowance according to this subsection.

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

(i) Calculate your retirement allowance pursuant to RCW 41.26.420 using:

(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 your retirement allowance:

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

(B) To reflect the difference in the number of years between your current age and the attainment of age fifty-three, if you are not yet fifty-three; and

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

(b) If you previously retired at or after age fifty-three, the department will:

(i) Calculate your retirement allowance pursuant to RCW 41.26.420 using:

(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 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 will you receive a retirement allowance creditable to a month during which you earned service credit.

(2) If you enter employment in a PERS, PSERS, SERS, or TRS ((or SERS)) eligible position, you have two options:

(a) You may choose not to become a member of the PERS, PSERS, SERS, or TRS ((or SERS)) retirement system and continue to receive your monthly LEOFF Plan 2 retirement allowance; or

(b) You may choose to become a member of the PERS, PSERS, SERS, or TRS ((or SERS)) retirement system. Your LEOFF retirement allowance will be suspended while you earn service credit and make contributions toward another retirement benefit. When you leave the PERS, PSERS, SERS, or TRS eligible position, you will resume receiving your LEOFF retirement allowance, along with retroactive payments for the time you were employed. You may choose to have your retroactive payments in a lump sum or actuarially computed into your LEOFF Plan 2 retirement allowance.

[Statutory Authority: RCW 41.50.050(5) and 41.26.500. 06-03-096, 415-104-111, filed 1/17/06, effective 2/17/06; 05-12-043, 415-104-111, filed 5/25/05, effective 6/25/05. 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-9109.1


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

WAC 415-113-030   Definitions for purposes of chapter 415-113 WAC.   (1) All definitions in RCW 41.54.010 and WAC 415-02-030 apply to terms used in this chapter. Other terms relevant to the administration of chapter 41.54 RCW are defined in this chapter.

(2) Average compensation means the compensation used by a particular retirement system to calculate a dual member's service retirement allowance. The actual meaning of the term varies depending upon the retirement system. With respect to each dual member system, "average compensation" means:

(a) First class city retirement systems: Final compensation as defined in RCW 41.28.010;

(b) LEOFF Plan 2: Final average salary as defined in RCW 41.26.030 (12)(b);

(c) PERS: Average final compensation as defined in RCW 41.40.010(17);

(d) PSERS: Average final compensation as defined in RCW 41.37.010(14);

(e) SERS: Average final compensation as defined in RCW 41.35.010(14);

(((e))) (f) Statewide cities retirement systems: Final compensation as defined in 41.44.030(14).

(((f))) (g) TRS:

(i) Plan 1: Average earnable compensation as defined in RCW 41.32.497 and 41.32.498;

(ii) Plans 2 and 3: Average final compensation as defined in RCW 41.32.010(30); and

(((g))) (h) WSPRS: Average final salary as defined in RCW 43.43.120(15).

(3) Dual member system refers to the state and city retirement systems admitted to participate under chapter 41.54 RCW. These systems include:

(a) First class city retirement systems of Seattle, Tacoma and Spokane;

(b) Law enforcement officers' and fire fighters' retirement system (LEOFF) Plan 2;

(c) Public employees' retirement system (PERS) Plans 1, 2 and 3;

(d) Public safety employees' retirement system (PSERS);

(e) School employees' retirement system (SERS) Plans 2 and 3;

(((e))) (f) Statewide cities employees' retirement system (SCERS);

(((f))) (g) Teachers' retirement system (TRS) Plans 1, 2 and 3; and

(((g))) (h) Washington state patrol retirement system (WSPRS) Plans 1 and 2.

(4) First class city retirement systems means the retirement systems for the non-LEOFF member employees of the cities of Seattle, Spokane and Tacoma authorized by chapter 41.28 RCW.

(5) Member participant.

(a) For all dual member systems administered by the department other than TRS Plan 1, "member participant" means a person who is employed for compensation in a dual member system qualifying position and is admitted into the membership of the system.

(b) For TRS Plan 1, "member participant" includes persons meeting the definition of (a) of this subsection and also includes members who are not employed for compensation but have accumulated contributions standing to their credit with TRS.

(c) This definition may not apply to first class city systems. See RCW 41.54.061 and WAC 415-113-005. If you have a question, you should contact the appropriate first class city system.

(6) Multiple system benefit means retirement allowances from two or more dual member systems calculated under chapter 41.54 RCW.

(7) Multiple system participant means a person who is a participant in two or more dual member systems.

(8) Multiple system retiree means a person who chooses to retire under the provisions of chapter 41.54 RCW.

(9)(a) Nonmember participant means a person who is no longer employed in a dual member system qualifying position but has not withdrawn his or her accumulated employee contributions.

(b) This definition does not apply to TRS Plan 1. A TRS Plan 1 member who meets the criteria of (a) of this subsection is a member participant.

(c) This subsection applies only to the retirement systems listed in RCW 41.50.030.

[Statutory Authority: RCW 41.50.050(5) and chapter 41.54 RCW. 02-18-046, 415-113-030, filed 8/28/02, effective 9/30/02. Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-113-030, filed 12/12/00, effective 1/12/01. Statutory Authority: RCW 41.50.050. 95-03-001, 415-113-030, filed 1/4/95, effective 2/4/95. Statutory Authority: RCW 34.05.350 and 1990 c 192 5(4). 90-22-038, 415-113-030, filed 11/1/90, effective 12/2/90.]


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

WAC 415-113-041   Am I a dual member?   You must meet all of the following criteria to be a dual member:

(1) You must be a participating member of a dual member system. You must be a current member participant in at least one of the systems listed in WAC 415-113-030 to be a dual member. You may have established dual member status if you are or were a member participant in one of those systems on or after:

(a) July 1, 1988, for current or former members of all plans of PERS, SERS, TRS, SCERS or WSPRS;

(b) July 25, 1993, for current or former members of LEOFF Plan 2; ((or))

(c) January 1, 1994, for current or former members of a first class city retirement system; or

(d) July 1, 2006, for current or former members of PSERS.

(2) You must also be a former or current member of at least one other system listed in WAC 415-113-030.

(3) You must not have been retired for service from a retirement system. You are not a dual member if you have ever been retired for service from any retirement system administered by the department of retirement systems or a first class city retirement system.

(4) If you are receiving a disability retirement allowance or disability leave benefits from a dual member system or LEOFF Plan 1, you cannot be a dual member.

(a) If you have received a lump sum disability benefit from PERS Plan 2 or 3, PSERS, SERS Plan 2 or 3, TRS Plan 2 or 3 or LEOFF Plan 2, you are in receipt of a disability benefit unless the department has found that you are no longer disabled.

(b) You are not receiving a disability retirement allowance or disability leave benefits if you:

(i) Previously received disability benefits and the department has subsequently found that you are no longer disabled, and has terminated your disability benefit; or

(ii) Retired for disability from service from WSPRS Plan 1 or 2.


Example 1: A former PERS Plan 1 member who has never been retired and becomes a member participant in TRS Plan 2 through employment with a TRS employer becomes a dual member.

(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(4).

(b) "Dual member system" - WAC 415-113-030.

(c) "Member participant" - WAC 415-113-030.

[Statutory Authority: RCW 41.50.050(5) and chapter 41.54 RCW. 02-18-046, 415-113-041, filed 8/28/02, effective 9/30/02. Statutory Authority: RCW 41.50.050(5), 41.54.010, 41.54.061. 02-03-120, 415-113-041, filed 1/23/02, effective 3/1/02. Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-113-041, filed 12/12/00, effective 1/12/01. Statutory Authority: RCW 41.50.050. 99-22-043, 415-113-041, filed 10/29/99, effective 11/29/99; 95-03-001, 415-113-041, filed 1/4/95, effective 2/4/95.]


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

WAC 415-113-042   What can terminate my status as a dual member?   (1) If you terminate your status as a participating member, you also terminate your status as a dual member. If you are no longer a member participant in any dual member system, you are no longer a dual member. If you later become a member of a dual member system, you again become a dual member.


Example 2: Upon separation from TRS Plan 2 eligible employment, the person in Example 1 (see WAC 415-113-041) is no longer a member of TRS Plan 2 nor a dual member.

(2) If you retire, you are no longer a dual member. When you retire from any or all dual member systems, you are no longer a dual member except for the purpose of receiving a deferred retirement allowance under RCW 41.54.030(3) and WAC 415-113-070.

(3) If you terminate dual membership, you may still be eligible to receive a multiple system benefit if otherwise eligible. The accrual date of your retirement allowance will vary depending upon the provisions of the particular system. You can find the accrual dates of different dual member systems in the following provisions:

(a) LEOFF 2: RCW 41.26.490;

(b) PERS 1: RCW 41.40.193;

(c) PERS 2: RCW 41.40.680;

(d) PERS 3: RCW 41.40.801;

(e) PSERS: RCW 41.37.240;

(f) SERS 2((;)): RCW 41.35.450;

(((f))) (g) SERS 3: RCW 41.35.640;

(((g))) (h) TRS 1: WAC 415-112-520;

(((h))) (i) TRS 2: RCW 41.32.795;

(((i))) (j) TRS 3: RCW 41.32.855.

(4) 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(4), WAC 415-113-041.

(b) "Dual member system" - WAC 415-113-030.

(c) "Member participant" - WAC 415-113-030.

(d) "Multiple system benefit" - WAC 415-113-030.

[Statutory Authority: RCW 41.50.050(5) and chapter 41.54 RCW. 02-18-046, 415-113-042, filed 8/28/02, effective 9/30/02. Statutory Authority: RCW 41.50.050(5), 41.54.010, 41.54.030. 02-03-120, 415-113-042, filed 1/23/02, effective 3/1/02. Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-113-042, filed 12/12/00, effective 1/12/01. Statutory Authority: RCW 41.50.050. 99-22-043, 415-113-042, filed 10/29/99, effective 11/29/99; 95-03-001, 415-113-042, filed 1/4/95, effective 2/4/95.]


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

WAC 415-113-065   Can I substitute salary from one system to another?   (1) You can substitute base salary between systems.

(a) If you choose to retire with a multiple system benefit, you may substitute your base salary under one dual member system for your includable compensation in a second dual member system for purposes of computing a retirement allowance from the second system. Using the substituted salary, the department will compute your average compensation under each system's own requirements.


Example 6: At retirement, Sandy is a member participant in PERS Plan 2 and has prior creditable service in TRS Plan 1. She earned her highest compensation during her PERS Plan 2 service. Sandy's PERS Plan 2 retirement allowance will be based on her PERS Plan 2 average compensation. For purposes of computing her TRS average compensation and retirement allowance, Sandy may substitute her PERS Plan 2 base salary earned over two consecutive fiscal years for her earnable compensation in TRS.
Example 7: At retirement, Pat is a member participant in TRS Plan 1 and has prior creditable service in PERS Plan 1. He earned his highest compensation during his membership in TRS Plan 1 and received a sick-leave cashout. Pat may substitute his base salary earned while a member in TRS Plan 1 for his PERS Plan 1 compensation earnable. However, because Pat may substitute only his base salary from TRS Plan 1 for his compensation earnable in PERS, his PERS average compensation will not include the cashout payments from his TRS employer.

(b) If you do not have sufficient service credit months in one dual member system to complete an average compensation period under that system, the department will substitute the appropriate number of months of base salary from another system to complete the average compensation period.


Example 8: Tim has creditable service in TRS Plan 1 and PERS Plan 2. He retires at age sixty-five after accruing twenty-four months of service in PERS Plan 2. Under PERS Plan 2, a member's average compensation period is the member's highest consecutive sixty-month period of compensation. To compute Tim's PERS Plan 2 retirement allowance, the department will substitute his highest consecutive thirty-six service credit months of TRS base salary to complete the PERS sixty-month average compensation period.

(2) Adjusted full-time salary is not base salary. A multiple system retiree's adjusted full-time salary under RCW 41.32.345 shall not constitute base salary for purposes of computing the retiree's multiple system benefit.

(3) Includable compensation defined. For purposes of this chapter, "includable compensation" means:

(a) Earnable compensation under TRS Plan 1, 2 or 3 as defined in RCW 41.32.010(10);

(b) Compensation earnable under PERS Plan 1, 2 or 3 as defined in RCW 41.40.010(8);

(c) Compensation earnable under PSERS as defined in RCW 41.37.010(6);

(d) Basic salary under LEOFF Plan 2 as defined in RCW 41.26.030 (13)(b);

(((d))) (e) Monthly salary under WSPRS Plan 1 or 2 as defined in RCW 43.43.120(23); and

(((e))) (f) Compensation earnable under SERS Plan 2 or 3 as defined in RCW 41.35.010(6).

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

(a) "Average compensation" - WAC 415-113-030.

(b) "Base salary" - RCW 41.54.010(1).

(c) "Dual member system" - WAC 415-113-030.

(d) "Member participant" - WAC 415-113-030.

(e) "Multiple system benefit" - WAC 415-113-030.

(f) "Multiple system retiree" - WAC 415-113-030.

[Statutory Authority: RCW 41.50.050(5) and chapter 41.54 RCW. 02-18-046, 415-113-065, filed 8/28/02, effective 9/30/02. Statutory Authority: RCW 41.50.050(5) and 41.54.030. 02-03-120, 415-113-065, filed 1/23/02, effective 3/1/02. Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-113-065, filed 12/12/00, effective 1/12/01. Statutory Authority: RCW 41.50.050. 99-22-043, 415-113-065, filed 10/29/99, effective 11/29/99; 95-03-001, 415-113-065, filed 1/4/95, effective 2/4/95.]


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

WAC 415-113-090   What is the maximum retirement benefit that I may receive under chapter 41.54 RCW?   (1) Your multiple system benefit may not exceed the highest maximum benefit which you would be permitted to receive under any one of the dual member systems from which you are retiring if all of your service had been provided in one system. See RCW 41.54.070.

(2) The department will compute your maximum multiple system benefit in the following order:

(a) Calculate the maximum benefit you could receive under each system. The department will compute your maximum benefit according to the benefit limitation provisions of each system as if you had earned your total career service and compensation in that system. In computing your maximum benefit under each system, the department will:

(i) Apply the provisions of each system governing the calculation of your average compensation in that system; and

(ii) Assume you earned all of your career service with your last employer for purposes of determining any limitations on the inclusion of leave cashouts in your average compensation.


Example 18: A multiple system retiree retires from TRS Plan 1 state employment with prior creditable PERS Plan 1 service. His PERS employer pays him an accrued sick leave cashout at termination. Because a sick leave cashout from a state agency employer is not includable as TRS earnable compensation, the department will not include the cashout in the retiree's average compensation for purposes of computing either his PERS Plan 1 or TRS Plan 1 maximum benefit.
Example 19: A multiple system retiree retires from PERS Plan 1 local government employment and receives a sick leave cashout. Because a sick leave cashout from a local government employer may be included as earnable compensation, the department will include the sick leave cashout to compute the retiree's maximum benefits under both PERS Plan 1 and TRS Plan 1.

(b) Determine your retirement allowances from each system. After computing your maximum benefit, the department will determine the retirement allowances to which you are entitled from each system under chapter 41.54 RCW before making any reduction under RCW 41.54.070. If applicable, the department will then reduce the amount of your retirement allowances provided by either of the dual member systems for:

(i) Your status as a nonmember participant of WSPRS Plan 1 or 2 pursuant to RCW 43.43.280(2); or

(ii) Your choice to retire early ((from a Plan 2 system)) under RCW 41.40.630 (2) or (3), 41.40.820 (2) or (3), 41.37.210(3), 41.35.420 (2) or (3), 41.35.680 (2) or (3), 41.32.765 (2) or (3), ((41.35.420(2))) 41.32.875 (2) or (3), and 41.26.430 (2) ((or Plan 3 system under RCW 41.32.875(2), 41.35.680(2), and 41.40.820(2))) or (3).

(c) Compute your total multiple system benefit. Upon computing your retirement allowances from each system and making any applicable reductions under (b) of this subsection, the department will add the systems' allowances to compute your total multiple system benefit.

(d) Compare your total multiple system benefit with your maximum benefit and, if necessary, proportionately reduce your retirement allowances. The department will then compare your total multiple system benefit with your maximum benefit calculated in (a) of this subsection. If your total multiple system benefit exceeds your maximum benefit, the department will proportionately reduce your retirement allowances provided by each system as follows:

(i) Calculate what proportion your total multiple system benefit is provided by each system separately; and

(ii) Proportionately reduce the benefit provided by each system to account for the excess of your total multiple system benefit over your maximum benefit.


Example 20: A person with twenty-nine years of prior service in TRS Plan 1 and one year of subsequent service in PERS Plan 2 retires from both systems at age sixty-five. The retiree's TRS Plan 1 average compensation is thirty thousand dollars. The TRS Plan 1 maximum benefit is sixty percent of average compensation. The retiree's maximum TRS benefit is eighteen thousand dollars or one thousand five hundred dollars per month. The retiree's PERS Plan 2 average compensation is twenty-eight thousand dollars. The retiree's maximum PERS 2 benefit is sixteen thousand eight hundred dollars or one thousand four hundred dollars per month. The retiree's maximum benefit is the higher of the two amounts, one thousand five hundred dollars per month.
Assume the retiree's accrued service is such that her actual TRS Plan 1 monthly benefit is one thousand four hundred fifty dollars and her PERS Plan 2 monthly benefit is one hundred dollars. The retiree's total multiple system benefit is the sum of her TRS Plan 1 and PERS Plan 2 benefits, or one thousand five hundred fifty dollars. Because the retiree's total multiple system benefit exceeds her maximum benefit by fifty dollars, the department would proportionately reduce her TRS Plan 1 and PERS Plan 2 benefits. Her TRS Plan 1 benefit is 29/30 of her total service or ninety-seven percent, and her PERS Plan 2 benefit is 1/30 of total service, or three percent. The department would reduce her TRS Plan 1 benefit by ninety-seven percent of the overage, or forty-eight dollars and fifty cents (50 x.97) and her PERS Plan 2 benefit by three percent of the overage, or one dollar and fifty cents (50 x.03).

(3) If you select a benefit payment option, the department will reduce your multiple system benefit to account as appropriate. After making any applicable maximum benefit reductions, the department will further reduce your benefit if you choose:

(a) To withdraw your accumulated contributions at the time you retire from TRS Plan 1;

(b) A survivor benefit option; or

(c) A cost-of-living adjustment (COLA) option.

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

(a) "Average compensation" - WAC 415-113-030.

(b) "Dual member" - RCW 41.54.010(4), WAC 415-113-041.

(c) "Dual member system" - WAC 415-113-030.

(d) "First class city system" - WAC 415-113-030.

(e) "Member participant" - WAC 415-113-030.

(f) "Multiple system benefit" - WAC 415-113-030.

(g) "Multiple system retiree" - WAC 415-113-030.

(h) "Nonmember participant" - WAC 415-113-030.

[Statutory Authority: RCW 41.50.050(5) and chapter 41.54 RCW. 02-18-046, 415-113-090, filed 8/28/02, effective 9/30/02. Statutory Authority: RCW 41.50.050(5) and 41.54.070. 02-03-120, 415-113-090, filed 1/23/02, effective 3/1/02. Statutory Authority: RCW 41.50.050. 99-22-043, 415-113-090, filed 10/29/99, effective 11/29/99; 96-20-004, 415-113-090, filed 9/19/96, effective 10/20/96; 95-03-001, 415-113-090, filed 1/4/95, effective 2/4/95.]

OTS-9110.1


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

WAC 415-115-020   Definitions.   As used in this chapter, unless a different meaning is plainly required by the context:

(1) "Department" refers to the department of retirement systems established pursuant to chapter 41.50 RCW as now existing or hereafter amended.

(2) "Employers" refers to all employers within the retirement systems administered by the department, as defined in RCW 41.50.030.

(3) "Reports" refers to the department of retirement systems transmittal report sent each month by employers to the department.

(4) "Close of business" refers to 5:00 p.m. of a business day.

(5) "Standard administrative fee" for employers in the public employees', public safety employees', school employees', teachers', and law enforcement officers' and fire fighters' retirement systems refers to the administrative fee provided for under RCW 41.50.110; for employers in the judges, judicial, and Washington state patrol retirement systems refers to the biennial appropriation that the department receives for administering each system.

(6) "Additional administrative fee" refers to the fee provided for under RCW 41.50.110(3) which is related to increased costs incurred by the department in processing deficient reports.

[Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-115-020, filed 12/12/00, effective 1/12/01. Statutory Authority: Chapter 43.05 [34.05] RCW, RCW 41.50.050 and 41.50.110(3). 91-13-030, 415-115-020, filed 6/12/91, effective 7/13/91.]


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

WAC 415-115-090   Maximum additional administrative fee allowable for the public employees', public safety employees', teachers', and law enforcement officers' and fire fighters' retirement systems.   The maximum additional administrative fee that may be charged to employers in the public employees' retirement system, the public safety employees' retirement system, the school employees' retirement system, the teachers' retirement system, and the law enforcement officers' and fire fighters' retirement system for any six-month period shall not exceed fifty percent of the standard administrative fee due for that six-month period. In instances where the standard administrative fee rate changes during the six-month period, the new standard administrative fee rate will be applied beginning with the month in which the new rate becomes effective. The maximum additional administrative fee that may be assessed is determined as follows:

(1) If the additional administrative fee as determined in accordance with WAC 415-115-080 is less than fifty percent of the standard administrative fee, the additional administrative fee is the maximum fee allowable.

(2) If the additional administrative fee as determined in accordance with WAC 415-115-080 is greater than or equal to fifty percent of the standard administrative fee, fifty percent of the standard administrative fee is the maximum fee allowable.

[Statutory Authority: Chapters 41.32, 41.34, 41.35, 41.50 RCW. 01-01-059, 415-115-090, filed 12/12/00, effective 1/12/01. Statutory Authority: Chapter 43.05 [34.05] RCW, RCW 41.50.050 and 41.50.110(3). 91-13-030, 415-115-090, filed 6/12/91, effective 7/13/91.]

Washington State Code Reviser's Office