130 likes | 215 Views
PRESENTATION TO THE NYS ASSOCIATION OF SMALL CITY SCHOOL DISTRICTS PENSION REFORM 2012. CHAPTER 18 OF THE LAWS OF 2012 May 21, 2012. TIGHTENING IN 2009: TIER 5. For TRS members first entering on or after January 1, 2010: 3.5% career contributions 10 year vesting
E N D
PRESENTATION TO THE NYS ASSOCIATION OF SMALL CITY SCHOOL DISTRICTSPENSION REFORM 2012 CHAPTER 18 OF THE LAWS OF 2012 May 21, 2012
TIGHTENING IN 2009: TIER 5 For TRS members first entering on or after January 1, 2010: • 3.5% career contributions • 10 year vesting • 25 years of service needed to be eligible for 2% pension factor • No unreduced benefit prior to age 57 with 30 years of service • More severe pre-2000 Tier 3/4 early retirement reductions brought back in Tier 5
FURTHER TIGHTING IN 2012: TIER 6 For TRS members first entering on or after April 1, 2012: • Member contribution rates (3%-6%) based upon wages • Prior service and military service costs 6% of wages • Benefit accrual rate generally reduced • No retirement with unreduced benefit prior to age 63 • 6.5% per year early retirement reductions • 5-year FAS with wages in excess of 110% of the average of the previous four years’ wages excluded from calculation • Annual wages in excess of $179,000 not pensionable • Wages from more than 2 employers excluded from FAS calculation • 10 year vesting unchanged
TIER 6 MEMBER CONTRIBUTION RATES • $45,000 or less = 3% • More than $45,000 to $55,000 = 3.5% • More than $55,000 to $75,000 = 4.5% • More than $75,000 to $100,000 = 5.75% • More than $100,000 to $179,000 = 6% Contribution rates are generally determined on 2 year lag basis; in first 3 plan years of membership on employer projections Transitional 3.5% rate until April 1, 2013
CHANGES IN FAS CALCULATION(figures rounded to whole numbers for presentation purposes)
CHAPTER 18 DC FEATURE • SUNY ORP opened to non-unionized public employees after June 30, 2013 • To be eligible, employee must be initially hired (not promoted) to a position with an estimated salary of $75,000 or more • Employers required to contribute 8% of wages • Employees contribute on same rate schedule as in Tier 6
OPTIONAL 57/30 BENEFIT ENHANCEMENT • Eligible members may retire with unreduced benefit at age 57 with 30 years of service • Eligible members must hold a position represented by NYSUT bargaining unit • NYSUT must ask the Governor to implement the enhancement • Eligible members must make sufficient additional contributions to cover the cost of the enhancement