WSR 14-13-007 EMERGENCY RULES DEPARTMENT OF RETIREMENT SYSTEMS [Filed June 5, 2014, 11:44 a.m., effective June 5, 2014, 11:44 a.m.] Effective Date of Rule: Immediately upon filing.
Purpose: To remove the provision that allows members of the Teachers' Retirement System Plan 3 to select a new contribution rate option each year.
Citation of Existing Rules Affected by this Order: Amending WAC 415-111-220.
Statutory Authority for Adoption: RCW 41.50.050(5).
Under RCW 34.05.350 the agency for good cause finds that state or federal law or federal rule or a federal deadline for state receipt of federal funds requires immediate adoption of a rule.
Reasons for this Finding: This rule change implements SB 6321 passed by the 2014 legislature and is necessary to meet plan qualification requirements in the Internal Revenue Code.
Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 1, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.
Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.
Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.
Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.
Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0.
Date Adopted: June 5, 2014.
Marcie Frost
Director
AMENDATORY SECTION (Amending WSR 06-03-097, filed 1/17/06, effective 2/17/06)
WAC 415-111-220 How do I choose a defined contribution rate?
(1) Contribution rates: If you are a member of the Teachers' Retirement System (TRS) Plan 3, the School Employees' Retirement System (SERS) Plan 3, or the Public Employees' Retirement System (PERS) Plan 3, you are required to contribute from your compensation according to one of the following rate structures:
(2) How do I make the choice? Under WAC 415-111-110, it is your responsibility to complete the correct form for choosing a contribution rate and submitting the form in a timely manner to your employer as directed on the form.
(3) Where do I get the form to make my choice? Your employer must provide the appropriate form to choose a contribution rate if you are enrolling in Plan 3 or transferring from Plan 2 to Plan 3.
(4) When do I have to choose? You must choose a contribution rate within ninety calendar days from your date of hire in an eligible position. However, if you are transferring from Plan 2 to Plan 3, you must choose a contribution rate at the same time you transfer. The ninety-day period does not apply to a member transferring from Plan 2 to Plan 3.
(5) When do contributions begin?
(a) Once you choose a contribution rate, contributions will begin the first day of the pay cycle in which you make the choice.
(b) If the employer advises the department that you should be reported into Plan 3 membership retroactively, the ninety-day period starts from the date it is discovered that you should have been reported. The department will decide which date to use.
(6) What if I work for more than one employer? If you are a Plan 3 member working in eligible positions for more than one employer, you may select a different contribution rate with each employer.
(7) What happens if I do not make a choice? Under RCW 41.34.040, you will be assigned a base rate of 5% (Option A) if:
(a) You are a new employee or changing your employer, and do not choose a contribution rate within the ninety-day election period described in subsection (4) of this section; or
(b) You are transferring from Plan 2 to Plan 3 and do not choose a contribution rate at the time of transfer. Contributions required under subsection (a) or (b) will begin the first day of the pay cycle in which you are assigned to Option A.
(8) Can I change my contribution rate?
(a) If you are a PERS 3 or SERS 3 member, once you choose a contribution rate or are assigned the base rate of 5% (Option A), you cannot change that contribution rate unless you change employers. This rule is required by an IRS decision on the tax qualified status of PERS 2 and 3 and SERS 2 and 3.
(b) Each time you change employers, you must choose a new contribution rate within ninety days or you will be assigned a base rate of 5% (Option A). No contributions will be taken until you choose a rate or until the ninety-day period has elapsed, whichever occurs first.
(c) Each January, through January 2015, TRS Plan 3 members may change their contribution rate option by providing written notification to their employer as described in WAC 415-111-110(1). After January 2015, TRS Plan 3 members may only change their contribution rate option as provided in (b) of this subsection. The termination of TRS rate flexibility in January 2015 is required to meet plan qualification requirements in the Internal Revenue Code.
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