WSR 99-22-043

PERMANENT RULES

DEPARTMENT OF

RETIREMENT SYSTEMS

[ Filed October 29, 1999, 1:57 p.m. ]

Date of Adoption: October 29, 1999.

Purpose: Miscellaneous rule changes to public employees retirement system (PERS) and portability, chapters 415-108 and 415-113 WAC, to clarify and comply with amendments to chapters 41.32, 41.40, and 41.50 RCW.

Citation of Existing Rules Affected by this Order: Amending WAC 415-108-726, 415-113-0302, 415-113-0303, 415-113-0305, 415-113-0309, 415-113-0310, 415-113-041, 415-113-042, 415-113-045, 415-113-059, 415-113-065, 415-113-070, 415-113-080, 415-113-082, 415-113-084, 415-113-090, and 415-113-100.

Statutory Authority for Adoption: RCW 41.50.050.

Adopted under notice filed as WSR 99-19-125 on September 21, 1999.

Changes Other than Editing from Proposed to Adopted Version: After the proposed version was filed, we revised examples 9 and 10 of WAC 415-113-070 to reflect 1997 changes in post retirement return to work statutes.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 16, Repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 1, Repealed 0.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0. Effective Date of Rule: Thirty-one days after filing.

October 29, 1999

John Charles

Director

OTS-3107.3


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

WAC 415-108-726
If I ((have accrued)) accrue service credit in PERS and another retirement plan((, am I excluded from participating)) at the same time, may I participate in PERS?

(((1) If you have earned service credit in any retirement plan operated wholly or in part by the state or a political subdivision, you can participate in PERS membership if an agreement exists between PERS and the other plan which permits you to retain service credit in more than one retirement system.  See RCW 41.40.023(4).  Such an agreement exists between PERS and the following systems:

(a) The retirement systems listed under RCW 41.50.030;

(b) The retirement systems of the cities of Seattle, Spokane and Tacoma; and

(c) The Teachers Insurance & Annuity Association/College Retirement Equity Fund retirement plan.

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

(a) "Membership" - RCW 41.40.023.

(b) "Retirement plan" - WAC 415-108-0105

(c) "Service" - RCW 41.40.010.)) (1)(a) Yes. You may earn service credit in PERS and any of the following systems at the same time if:

(i) You work for a PERS employer and an employer covered by a retirement system of the city of Seattle, Spokane or Tacoma (First Class City Retirement System); and

(ii) You cannot report service for the First Class City Retirement System in PERS;

(b) The combined service credit under PERS and the retirement system listed in (a) of this subsection may not exceed one month of service for a calendar month of employment.

(c) To qualify for PERS service credit, it is up to the employee to initiate the process by applying under subsection (2) of this section.


Example: A member works part time for the City of Seattle and part time for the University of Washington (UW). She may receive partial service credit in PERS for the UW service since she cannot report the time she works for Seattle under PERS.
Note: The combined service credit under PERS and the City of Seattle Retirement System may not exceed one month of service for a calendar month of employment. To receive PERS service credit she must apply to the department.

(2) How do I apply?

(a) To apply for membership and service credit under subsection (1) of this section you must send the department an application. The application is a statement that you want membership and/or service credit in PERS. Include:

(i) Your name;

(ii) Your SSN;

(iii) All period(s) of service that you want to receive service credit for;

(iv) All PERS and non-PERS employer(s) that you worked for during the periods of service referenced in (a)(iii) of this subsection.

(b) After the department receives your application, it will contact your employer(s) to verify how much service credit you have earned. When the department receives the necessary information, it will determine how much service credit you will receive. At that time the department will send you a bill for member contributions and interest that must be paid in order to establish the service credit.

(3) When should I submit my payment?

You should pay contributions and interest required under subsection (2)(b) of this section within twenty-four consecutive months from the last day of the calendar year for which you claim service credit. After that date, you must pay the actuarial cost of purchasing the service credit under RCW 41.40.104 and 41.50.165.

(4) What if I worked before this WAC became effective?

If you worked for a PERS employer and for one of the retirement systems listed in subsection (1) of this section, before this WAC became effective, you have until December 31, 2000, to apply in order to purchase service credit by paying member contributions plus interest. After December 31, 2000, you must pay the actuarial cost of purchasing the service credit under RCW 41.40.104 and 41.50.165.

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

(a) "Membership" - RCW 41.40.023.

(b) "Retirement plan" - WAC 415-108-0105.

(c) "Service" - RCW 41.40.010.

(d) "Normally" - WAC 415-108-0102.

[Statutory Authority: RCW 41.50.050.  95-16-053, 415-108-726, filed 7/25/95, effective 8/25/95.]

OTS-3052.4


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-005
Purpose and scope.

(1) Purpose. The rules adopted in this chapter further define and clarify the application of the portability statutes, chapter 41.54 RCW.  Chapter 41.54 RCW allows:

(a) Service in dual member systems to be combined to determine service retirement eligibility; and

(b) Compensation earned in one dual member system to be used to calculate a retirement allowance in another designated system.

(2) Scope. This chapter shall apply to the retirement systems listed in RCW 41.50.030, except for LEOFF Plan ((I)) 1.  This chapter must be read to be consistent with the statutory provisions of chapter 41.54 RCW and the statutory provisions governing the dual member systems.  These rules may be used by the first class city retirement systems but do not mandatorily apply to them.  These rules do apply to all dual member benefits calculated and paid by the department, even if one of the member's systems is a first class city retirement system.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-005, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-0302
Average compensation--Definition.

"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:

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

(2) State-wide cities retirement systems: Final compensation as defined in 41.44.030(14);

(3) TRS:

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

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

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

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

(6) WSPRS: Average final salary as defined in RCW 43.43.120.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-0302, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-0303
Dual member system--Definition.

"Dual member system" means the state and city retirement systems admitted to participate under chapter 41.54 RCW.  These systems are:

(1) PERS Plans ((I)) 1 and ((II)) 2;

(2) TRS Plans ((I)) 1, 2 and ((II)) 3;

(3) LEOFF Plan ((II)) 2;

(4) WSPRS;

(5) State-wide city employees' retirement system; and

(6) The first class city retirement systems.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-0303, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-0305
Member participant--Definition.

(1) For all dual member systems administered by the department other than TRS Plan ((I)) 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.

(2) For TRS Plan ((I)) 1, "member participant" includes persons meeting the definition of subsection (1) of this section and also means a member who is not employed for compensation but has accumulated contributions standing to his or her credit with TRS.

(3) For the first class city systems, this definition may not apply, see WAC 415-113-005.  If you have a question, you should contact the appropriate first class city system.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-0305, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-0309
Nonmember participant--Definition.

(1) "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.

(2) This definition does not apply to TRS Plan ((I)) 1.  A TRS Plan ((I)) 1 member who meets the criteria of subsection (1) of this section is a member participant, see WAC 415-113-0307.

(3) This section applies only to the retirement systems listed in RCW 41.50.030.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-0309, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-0310
System acronyms--Definition.

The acronyms used in this chapter mean:

(1) "LEOFF Plan ((II)) 2" means Law Enforcement Officers' and Fire Fighters' Retirement System Plan ((II)) 2.

(2) "PERS Plan ((I)) 1" means Public Employees' Retirement System Plan ((I)) 1.

(3) "PERS Plan ((II)) 2" means Public Employees' Retirement System Plan ((II)) 2.

(4) "TRS Plan ((I)) 1" means Teachers' Retirement System Plan ((I)) 1.

(5) "TRS Plan ((II)) 2" means Teachers' Retirement System Plan ((II)) 2.

(6) "TRS Plan 3" means Teachers' Retirement System Plan 3.

(7) "WSPRS" means Washington State Patrol Retirement System.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-0310, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

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 member of a dual member system. You must be a current member participant in at least one dual member system to be a dual member.  You may have established dual member status if you are or were a member participant of a dual member system on or after:

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

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

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

(2) You must be a former or current member of another dual member system.

(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) You must not be in receipt of a disability benefit from a dual member system. If you are receiving a disability retirement allowance or disability leave benefits from a dual member system or LEOFF Plan ((I)) 1, you cannot be a dual member.

(a) If you have received a lump sum disability benefit from PERS Plan ((II)) 2, TRS Plan ((II)) 2 or 3 or LEOFF Plan ((II)) 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.


Example 1: A former PERS Plan ((I)) 1 member who has never been retired and becomes a member participant in TRS Plan ((II)) 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 415-113-0303.

(c) "Member participant" - WAC 415-113-0305.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-041, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-042
Can I terminate my status as a dual member? Termination of dual member status--Reestablishing dual member status.

(1) If you are not a member, you are not 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 ((II)) 2 eligible employment, the person in Example 1 in WAC 415-113-041 is no longer a member of TRS Plan ((II)) 2 nor a dual member.

(2) If you retire, you are no longer a dual member. Upon retirement from any or all dual member systems, a person is 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 are not a dual member, you may still be eligible for a multiple system benefit. If you are no longer a dual member you may still be able 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) PERS ((I)) 1: RCW 41.40.193;

(b) PERS ((II)) 2: RCW 41.40.680;

(c) TRS ((I)) 1: WAC 415-112-520;

(d) TRS ((II)) 2: RCW 41.32.795;

(e) TRS 3: RCW 41.32.855;

(f) LEOFF ((II)) 2: RCW 41.26.490.

(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 415-113-0303.

(c) "Member participant" - WAC 415-113-0305.

(d) "Multiple system benefit" - WAC 415-113-0306.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-042, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-045
Can I reestablish service credit in a prior system?

(1) You may reestablish service credit terminated by a withdrawal of contributions from a prior system. If you repay contributions you withdrew from a prior dual member system plus interest from the date of withdrawal you will recover the service terminated by the withdrawal.  To qualify, you must repay the contributions plus interest within twenty-four consecutive months from the date you became a dual member.

(a) The twenty-four-month restoration period continues to run even if you terminate dual member status.

(b) If you terminate your dual member status but later become a dual member again, you have twenty-four consecutive months from the date you regain dual member status to repay withdrawn contributions.


Example 3: A person becomes a dual member on January 1, 1994.  She has until December 31, 1995, to restore any previously withdrawn contributions for service credit in a prior system regardless of whether she subsequently loses her status as a dual member.
Example 4: A person becomes a dual member on January 1, 1994, separates from membership on January 1, 1995, and then reenters membership on January 1, 1996.  He has until December 31, 1997, twenty-four consecutive months from the date he regained dual member status, to restore withdrawn contributions in any prior system.

(c) If you have previous service in LEOFF Plan ((II)) 2 or a first class city system:

(i) If you were a dual member on July 25, 1993, and you used to be a member of LEOFF Plan ((II)) 2, you have until July 24, 1995, to repay your withdrawn contributions.

(ii) If you were a dual member on January 1, 1994, and you used to be a member of a first class city retirement system, you have until December 31, 1995, to repay your withdrawn contributions.


Example 5: A person is a member participant in PERS Plan ((II)) 2 and has previous service in LEOFF Plan ((II)) 2.  LEOFF Plan ((II)) 2 was newly admitted to participate under the portability provisions of chapter 41.54 RCW on July 25, 1993.  Therefore, the person has until July 24, 1995, to restore her prior LEOFF Plan ((II)) 2 service.

(2) You may reestablish TRS Plan ((I)) 1 membership. If a PERS member restores withdrawn TRS Plan ((I)) 1 contributions under this section he or she:

(a) Reestablishes membership in TRS Plan ((I)) 1; and

(b) Will participate prospectively in TRS Plan ((I)) 1 if employed by a state agency, school district or other TRS employer.

(3) 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 415-113-0303.

(c) "First class city retirement system" - WAC 415-113-0304.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-045, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 96-20-004, filed 9/19/96, effective 10/20/96)

WAC 415-113-059
Can I combine service from different systems to qualify for increased benefits?

(1) You may combine service to determine retirement eligibility. You may combine your service in all systems for the sole purpose of determining your eligibility for a disability or service retirement allowance from your current system and a service retirement allowance from your prior system.

(2) You may not combine service for any other purpose. You may not combine your service in all systems to qualify for additional benefits offered by a particular system.  Those additional benefits include but are not limited to:

(a) PERS Plan ((I)) 1 military service.  You may not combine service from other systems to qualify for military service credit in PERS Plan ((I)) 1 under RCW 41.40.170.

(b) LEOFF Plan ((II)) 2 post-separation benefits.  You may not combine your accrued service under both systems for purposes of qualifying for:

(i) A LEOFF Plan ((II)) 2 indexed retirement allowance under RCW 41.26.530(2); or

(ii) A refund of one hundred fifty percent of the LEOFF Plan ((II)) 2 member's accumulated contributions under RCW 41.26.540.

(3) Defined terms used.  Definitions for the following terms used in this section may be found in the sections listed: "System" - RCW 41.54.010(6).

[Statutory Authority: RCW 41.50.050.  96-20-004, 415-113-059, filed 9/19/96, effective 10/20/96; 95-03-001, 415-113-059, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-065
Can I substitute salary from one system to another?

(1) You can substitute base salary between systems.

(a) If you elect 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, a person is a member participant in PERS Plan ((II)) 2 and has prior creditable service in TRS Plan ((I)) 1.  Assume the multiple system retiree earned her highest compensation during her PERS Plan ((II)) 2 service.  The retiree's PERS Plan ((II)) 2 retirement allowance will be based on her PERS Plan ((II)) 2 average compensation.  For purposes of computing her TRS average compensation and retirement allowance, she may substitute her PERS Plan ((II)) 2 base salary earned over two consecutive fiscal years for her earnable compensation in TRS.
Example 7: At retirement, a person is a member participant in TRS Plan ((I)) 1 and has prior creditable service in PERS Plan ((I)) 1.  Assume the multiple system retiree earned his highest compensation during his membership in TRS Plan ((I)) 1.  The retiree may substitute his base salary earned while a member in TRS Plan ((I)) 1 for his PERS Plan ((I)) 1 compensation earnable.  However, because he may substitute only his base salary from TRS Plan ((I)) 1 for his compensation earnable in PERS, his PERS average compensation will not include any 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: A person who has creditable service in TRS Plan ((I)) 1 and PERS Plan ((II)) 2 retires at age sixty-five having accrued twenty-four months of service in PERS Plan ((II)) 2.  Under PERS Plan ((II)) 2, a member's average compensation period is the member's highest consecutive sixty-month period of compensation.  To compute the multiple system retiree's PERS Plan ((II)) 2 retirement allowance, the department will substitute her 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 ((I or II)) 1, 2 or 3 as defined in RCW 41.32.010(10);

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

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

(d) Monthly salary under WSPRS as used in RCW 43.43.120(15).

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

(a) "Average compensation" - WAC 415-113-0302.

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

(c) "Dual member system" - WAC 415-113-0303.

(d) "Member participant" - WAC 415-113-0305.

(e) "Multiple system benefit" - WAC 415-113-0306.

(f) "Multiple system retiree" - WAC 415-113-0308.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-065, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 96-20-004, filed 9/19/96, effective 10/20/96)

WAC 415-113-070
Can I defer my retirement allowance from a system if I retire with a multiple system benefit?

(1) You may defer receipt of your retirement allowance. If, by combining creditable service, you qualify to retire in one system but not in a second system, you must either:

(a) Receive an actuarially reduced retirement allowance from the second system; or

(b) Defer retirement in the second system until a later date of your choice.  If you choose to begin receiving a retirement allowance from your second system before you are fully eligible, the benefit will be actuarially reduced.

(i) If you elect to defer retirement in the second system, you retain dual member status for the sole purpose of receiving a deferred multiple system benefit;

(ii) If you retire from all systems but elect to defer retirement in one dual member system under RCW 41.54.030(3), you may not subsequently withdraw accumulated contributions from that system.

(c) An actuarial reduction under (a) or (b) of this subsection, if applicable, will account for the difference between your age at the time you begin receiving the retirement allowance and the earliest age where you would be fully eligible based upon your combined service.  "Fully eligible" means a person who has enough combined service to qualify for a retirement allowance from a dual member system without receiving a reduction for:

(i) Early retirement from a Plan ((II)) 2 system ((pursuant to)) under RCW 41.40.630(2), 41.32.765(2), 41.26.430(2); or

(ii) Early retirement from a Plan 3 system under RCW 41.32.875(2); or

(iii) Retirement as a nonmember participant from WSPRS under RCW 43.43.280(2).

(2) If you defer your retirement allowance and later reenter membership, you are no longer a dual member. If, after deferring retirement, you enter membership in a dual member system, your dual member status terminates.  Once your dual member status terminates:

(a) You may only retire under the deferred system if eligible based solely upon that system's retirement eligibility criteria; and

(b) Your retirement allowance under the deferred system will be based solely upon service actually established in that system.


Example 9: A sixty-two year old dual member of PERS Plan ((I)) 1 and TRS Plan ((II)) 2 retires.  He elects to receive PERS Plan ((I)) 1 benefits but defer receipt of a TRS Plan ((II)) 2 retirement allowance.  If he becomes reemployed in a TRS Plan ((II)) 2 eligible position, he will reenter TRS Plan ((II)) 2 membership if otherwise eligible and terminate his dual member status, but he will continue to receive his PERS Plan ((I)) 1 retirement allowance until he works more than the work-limit in a calendar year under WAC 415-108-710.  The member's eligibility to retire from TRS Plan ((II)) 2 will be based solely on his accrued service credit in TRS Plan ((II)) 2 and his TRS Plan ((II)) 2 retirement allowance will be based solely on his compensation while he was a member participant in TRS Plan ((II)) 2.
Example 10: Assume the retiree in Example 9 above became reemployed in a PERS position rather than a TRS Plan ((II)) 2 position.  He could work in this position up to the work-limit in a calendar year under WAC 415-108-710 without having his PERS retirement allowance suspended. If the retiree works over the work-limit:
The department would suspend his retirement allowance until the next calendar year. He would remain a dual member. He would be able to retire in TRS 2 if otherwise eligible;
The retiree ((would)) could elect to reenter PERS Plan ((I)) 1 membership at any time, if otherwise eligible, and terminate his dual member status.  His election for membership is not retroactive. The effect on the person's right to a TRS Plan ((II)) 2 benefit is the same as in Example 9.  ((Because the retiree reentered PERS membership, the department would also suspend his PERS Plan I retirement allowance.)) See WAC 415-108-710.

(3) If you defer your retirement allowance and die before you begin receiving the allowance, your survivor may receive a continuing benefit.  If you defer receipt of your retirement allowance from a system and die before you elect to begin receiving the allowance:

(a) Your surviving spouse, if any, must elect to receive either:

(i) A joint and one hundred percent survivor option from the deferred system.  If your surviving spouse selects this option, your base salary under one system may be substituted for your includable compensation in the deferred system to compute the survivor retirement allowance from the deferred system; or

(ii) A refund of your accumulated contributions from the deferred system.

(b) If you do not have a surviving spouse, the department will pay your accumulated contributions from the deferred system to:

(i) Your designated beneficiary or beneficiaries; or

(ii) Your estate, if there are no living beneficiaries.

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

(a) "Dual member system" - RCW 41.32.010(4), WAC 415-113-041.

(b) "Member participant" - WAC 415-113-0305.

(c) "Includable compensation" - WAC 415-113-065(3)

(d) "Multiple system participant" - WAC 415-113-0307.

(e) "Nonmember participant" - WAC 415-113-0309.

(f) "System" - RCW 41.54.010(6).

[Statutory Authority: RCW 41.50.050.  96-20-004, 415-113-070, filed 9/19/96, effective 10/20/96; 95-03-001, 415-113-070, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-080
Can I retire retroactively? You may retire retroactively.

If you retire from all dual member systems, your retirement allowance from a prior system will be retroactive back to your accrual date under the prior system.

(1) Accrual date determined. The department will determine your accrual date in each system by combining your total service and applying the statute or rule designating accrual dates in the particular system.  Your accrual date for purposes of this section is the date that your combined service first makes you eligible for an unreduced benefit.


Example 11: A person is a fifty-five year old member participant in PERS Plan ((II)) 2 and a nonmember participant in LEOFF Plan ((II)) 2.  The person decides not to retire from LEOFF Plan ((II)) 2 until he is eligible to retire with full benefits from PERS Plan ((II)) 2 at age sixty-five.  Upon retirement, he will be entitled to a LEOFF Plan ((II)) 2 retirement allowance effective on his accrual date under LEOFF Plan ((II)) 2 (i.e., age fifty-five).
Example 12: A person with twenty years of prior service in TRS Plan ((I)) 1 becomes a member participant in PERS Plan ((II)) 2 on her fifty-fourth birthday.  By combining her service in both systems under chapter 41.54 RCW, she will become eligible to retire under TRS Plan ((I)) 1 at age fifty-nine with twenty-five total years of service.  Assume she retires from both systems at age sixty-five.  Her TRS Plan ((I)) 1 retirement allowance will be effective back to the date it accrued under TRS Plan ((I)) 1 (i.e., the first of month following the month she turns fifty-nine).

(2) You cannot use salary earned after your accrual date in calculating your retroactive benefit. If you retire retroactively from a prior system, the department will not use any of the salary you earned after your accrual date to compute your benefit from the prior system.


Example 13: A PERS Plan 1 member receives a salary of $3,000 per month. She has 30 years of service credit at age 50 and is eligible to retire with an unreduced (full) benefit.

Subsequently, she is offered a TRS Plan 3 covered position at a monthly salary of $3,500. If she accepts the TRS Plan 3 position, will she be able to use its higher monthly salary of $3,500 as base salary to calculate her PERS Plan 1 retirement benefit when she does retire? No, she will not. The TRS Plan 3 salary would have been earned after the PERS Plan 1 accrual date: The date that she first became eligible to retire with an unreduced benefit under PERS Plan 1 rules.

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

(a) "Dual member system" - WAC 415-113-0303.

(b) "Member participant" - WAC 415-113-0305.

(c) "Nonmember participant" - WAC 415-113-0309.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-080, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-082
Could retroactive retirement cancel my membership in a subsequent system?

(1) If you retire retroactively from a prior system, you could cancel your membership in a subsequent system. If your membership in a subsequent system would have been prohibited under RCW 41.04.270 but for your status as a dual member, and you retire retroactively from a prior system, the department will cancel your membership and refund your contributions in the subsequent system under RCW 41.54.020(1).  Your retroactive retirement from a prior system may cancel your membership in a subsequent system according to the following table:



How much service did you earn in your prior system?

Were you eligible to retire in the prior system before you became a member of your subsequent system?

Will retroactive retirement from your prior system cancel your membership in subsequent system?

15 years or more

No

No (See Example 13)

15 years or more

Yes

Yes, unless you retire from both the prior and subsequent system under RCW 41.54.030(2). (See Example 14)

Less than 15 years

No

No (See Example 15)

Less than 15 years

Yes

No (See Example 15)
See RCW 41.54.020(1) and RCW 41.04.270.


Example

((13)) 14:

A nonmember participant in LEOFF Plan ((II)) 2 who has accrued sixteen years of service in LEOFF Plan ((II)) 2 became a member of PERS Plan ((II)) 2 at age fifty-four.  Because she became a member participant of PERS Plan ((II)) 2 at age fifty-four, prior to attaining retirement eligibility under LEOFF Plan ((II)) 2 (i.e., age fifty-five), she may later retire retroactively from LEOFF Plan ((II)) 2, subject to LEOFF Plan ((II)) 2 criteria, while continuing membership in PERS Plan ((II)) 2.
Example

((14)) 15:

A nonmember participant in LEOFF Plan ((II)) 2 with sixteen years of accrued service became a member of PERS Plan ((II)) 2 at age fifty-five.  If he attempts to retire from LEOFF Plan ((II)) 2 while continuing membership in PERS Plan ((II)) 2, the department will cancel his PERS Plan ((II)) 2 membership and refund his PERS contributions.  However, if he retires from both systems, he is entitled to retain the benefits of his PERS Plan ((II)) 2 membership.
Example

((15)) 16:

Assume either of the retirees in Examples 13 and 14 above had accrued less than fifteen years of service in LEOFF Plan ((II)) 2.  In this case, RCW 41.04.270 would not apply to prevent the retirees from establishing PERS Plan ((II)) 2 membership.  Either person could retire retroactively from the LEOFF Plan ((II)) 2 without canceling membership and participation in PERS Plan ((II)) 2.

(2) 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) "Member participant" - WAC 415-113-0305.

(c) "Nonmember participant" - WAC 415-113-0309.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-082, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-084
How will my benefit be computed if I retire retroactively from LEOFF Plan ((II)) 2?

(1) Computation of your retroactive LEOFF Plan ((II)) 2 retirement allowance. If you retire with a multiple system benefit and one of your retirement allowances is a retroactive LEOFF Plan ((II)) 2 allowance, the department will compute your LEOFF Plan ((II)) 2 allowance based upon the greater of:

(a) Your LEOFF Plan ((II)) 2 final average salary, substituting some or all of your base salary under the second system which you earned prior to the date your LEOFF Plan ((II)) 2 retirement allowance began to accrue (i.e., age fifty-five); or

(b) An indexed retirement allowance under RCW 41.26.530(2) using your LEOFF Plan ((II)) 2 average compensation.


Example

((16)) 17:

A person who is a nonmember participant of LEOFF Plan ((II)) 2 and a member participant of PERS Plan ((II)) 2 retires from both systems at age sixty-five.  If he had accrued twenty-one years of creditable service in LEOFF Plan ((II)) 2, the multiple system retiree's LEOFF Plan ((II)) 2 retirement allowance may be based upon either: His substituted PERS Plan ((II)) 2 base salary which he earned prior to attaining retirement eligibility in LEOFF at age fifty-five; or the LEOFF Plan ((II)) 2 indexed retirement allowance under RCW 41.26.530(2) using his LEOFF Plan ((II)) 2 average compensation. The department will use the method which results in the largest retirement allowance.

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

(a) "Member participant" - WAC 415-113-0305.

(b) "Multiple system benefit" - WAC 415-113-0306.

(c) "Multiple system retiree" - WAC 415-113-0308.

(d) "Nonmember participant" - WAC 415-113-0309.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-084, filed 1/4/95, effective 2/4/95.]


AMENDATORY SECTION(Amending WSR 96-20-004, filed 9/19/96, effective 10/20/96)

WAC 415-113-090
What is the maximum retirement benefit that I may receive under chapter 41.54 RCW?

(1) Your benefit may not exceed the highest benefit limit under any one system.  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.  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

((17)) 18:

A multiple system retiree retires from TRS Plan ((I)) 1 state employment with prior creditable PERS Plan ((I)) 1 service.  His state employer pays him an accrued sick leave cashout at termination.  Because a sick leave cashout from a state agency employer is not includable as earnable compensation, the department will not include the cashout in the retiree's average compensation for purposes of computing either his PERS Plan ((I)) 1 or TRS Plan ((I)) 1 maximum benefit.
Example

((18)) 19:

A multiple system retiree retires from PERS Plan ((I)) 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 ((I)) 1 and TRS Plan ((I)) 1.

(b) Determine your retirement allowances from each system. After computing your maximum benefit, the department will determine the retirement allowances which you are entitled to 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 pursuant to RCW 43.43.280(2); or

(ii) Your election to retire early from a Plan ((II)) 2 system ((pursuant to)) under RCW 41.40.630(2), 41.32.765(2), and 41.26.430(2) or Plan 3 system under RCW 41.32.875(2).

(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;

(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

((19)) 20:

A person with twenty-nine years of prior service in TRS Plan ((I)) 1 and one year of subsequent service in PERS Plan ((II)) 2 retires from both systems at age sixty-five.  The retiree's TRS Plan ((I)) 1 average compensation is thirty thousand dollars.  The TRS Plan ((I)) 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 ((II)) 2 average compensation is twenty-eight thousand dollars.  The retiree's maximum PERS ((II)) 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 ((I)) 1 monthly benefit is one thousand four hundred fifty dollars and her PERS Plan ((II)) 2 monthly benefit is one hundred dollars.  The retiree's total multiple system benefit is the sum of her TRS Plan ((I)) 1 and PERS Plan ((II)) 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 ((I)) 1 and PERS Plan ((II)) 2 benefits.  Her TRS Plan ((I)) 1 benefit is 29/30 of her total service or ninety-seven percent, and her PERS Plan ((II)) 2 benefit is 1/30 of total service, or three percent.  The department would reduce her TRS Plan ((I)) 1 benefit by ninety-seven percent of the overage, or forty-eight dollars and fifty cents (50 x .97) and her PERS Plan ((II)) 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 elect:

(a) To withdraw your accumulated contributions at the time you retire from TRS Plan ((I)) 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 415-113-0302.

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

(c) "Dual member system" - WAC 415-113-0303.

(d) "First class city system" - WAC 415-113-0304.

(e) "Member participant" - WAC 415-113-0305.

(f) "Multiple system benefit" - WAC 415-113-0306.

(g) "Multiple system retiree" - WAC 415-113-0308.

(h) "Nonmember participant" - WAC 415-113-0309.

[Statutory Authority: RCW 41.50.050.  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.]


AMENDATORY SECTION(Amending WSR 95-03-001, filed 1/4/95, effective 2/4/95)

WAC 415-113-100
Am I eligible for a lump sum retirement allowance?

(1) If you retire with a multiple system benefit and one of your retirement allowances is less than fifty dollars per month, you may receive a lump sum payment as allowed under RCW 41.54.090.

(2) Unless you are retiring from TRS Plan ((I)) 1, the department will use your standard retirement allowance to determine your eligibility for lump sum cashouts under RCW 41.54.090.

(3) If you are retiring from TRS Plan ((I)) 1, the department will use your maximum retirement allowance under TRS Plan ((I)) 1 to determine your eligibility for lump sum cashouts under RCW 41.54.090.

(4) Defined terms used. Definitions for the following terms used in this section may be found in the sections listed: "Multiple system benefit" - WAC 415-113-0306.

[Statutory Authority: RCW 41.50.050.  95-03-001, 415-113-100, filed 1/4/95, effective 2/4/95.]

Washington State Code Reviser's Office