Title: YOUR RETIREMENT SYSTEM
1YOUR RETIREMENT SYSTEM
PSPRS
- PUBLIC
- SAFETY
- PERSONNEL
- RETIREMENT
- SYSTEM
2 RETIREMENT DUTIES
- WHAT YOUR LOCAL BOARD NEEDS TO KNOW
3Most Important Responsibility
- Decide all questions of eligibility and service
credits, and determine the amount, manner and
time of payment of any benefits under the plan.
(A.R.S. 38-847, section D.1.) - Usually tasked to the board secretary or HR
personnel who have access to personnel and
payroll records
4How do you determine eligibility for retirement
benefits?
- Need to know what type of retirement benefits are
available - NORMAL
- DISABILITY
- DEFERRED ALLOWANCE
- SURVIVOR
- GUARDIAN/CHILD
- DEATH BENEFIT
- DEFERRED RETIREMENT OPTION PLAN (DROP)
- REVERSE DROP
5NORMAL RETIREMENTS
- Member must meet one of the following for normal
retirement - 20 years of service
- 15 years of service and age 62 (at time of
termination)
6DISABILITY RETIREMENTS
- Temporary Disability total and presumably
temporary disability incurred in performance of
duty, prior to normal retirement, preventing
performance of a reasonable range of duties,
payments terminate after 12 months - Accidental Disability total and permanent
disability incurred in performance of duty,
preventing performance of a reasonable range of
duties - Catastrophic Disability physical, and not a
psychological, condition incurred in performance
of duty, which totally and permanently prevents
engaging in any gainful employment - Ordinary Disability physical condition total
and permanent disability, preventing performance
of a reasonable range of duties prior to normal
retirement mental condition total and permanent
disability preventing any substantial gainful
activity
7DEFERRED ALLOWANCE
- A member with at least 10 years of credited
service, who terminates employment, may elect to
leave their contributions in the system and
receive a deferred allowance, commencing at age
62. - No survivor allowance
- No benefit increase
- No 2 tax equity
- No insurance subsidy
8SURVIVOR BENEFITS
- Surviving spouse of a non-retired member
- Marriage at time of death
- Benefit is 80 of the pension the deceased active
member would have been paid for an accidental
disability retirement - If the member was killed in the line of duty, the
benefit is 100 of the deceased members average
monthly benefit compensation - Surviving spouse of a retired member
- Requires two consecutive years of marriage at
time of death - Benefit is 80 of retired members pension at time
of death
9GUARDIAN/CHILD BENEFITS
- Non-retired member
- Guardian Same as the spouses pension. Payable
only during periods no spouse is being paid and
there is at least one eligible child. - Child One-tenth of pension deceased active
member would have been paid for accidental
disability retirement (equal shares of two-tenths
if more than two children) Eligible child must be
unmarried, a dependent of the surviving spouse or
guardian and either under the age of 18 or
full-time student under the age of 23 or under a
disability which began before age 23
10DEATH BENEFITS
- If a member has accumulated contributions
remaining in the system at the date of death of
the last beneficiary, a lump sum refund of such
accumulated contributions are payable to the
beneficiary named by the member.
11DROP
- A member with 20 or more years of credited
service - The member must voluntarily and irrevocably elect
to enter into the program with his employer for a
period of up to 60 months - Payment made at the end of the DROP period at the
same time/manner as the normal pension
12What is the difference between DROP Retirement?
- The local board would calculate the DROP just
like a retirement (using a different spreadsheet) - The accumulated dollar amount will be pre tax,
and allowed to grow at an assumed earnings rate,
currently 8.50, which is compounded monthly for
a period of five years while the member continues
to work. - When the member retires, they begin receiving the
monthly check for life as well as a lump sum of
the accumulated DROP account. - By electing DROP the member will earn interest,
and will still have to pay taxes unless they
elect to roll the lump sum over to an IRA or
other pension account.
13REVERSE DROP
- Any member who is eligible for a normal pension
(20 years credited service and one month) and
who is not in DROP - Interest rate of 3.5 annually
- Member must voluntarily and irrevocably elect to
terminate employment and receive a normal
retirement upon participation
14What is Reverse DROP?
- Its just another payment option for the member
to consider. - When electing any of the reverse DROP options the
member will be choosing an option that will pay
LESS money in the long run. - The advantage is a lump sum of money up front.
The member will receive a smaller monthly amount
for life than if they had stayed an additional 5
years and retired.
15How do you determine the high 3 years?
- Use a period of 3 consecutive years within the
last twenty completed years of credited service
which yield the highest average - A period of non-paid or partially paid industrial
leave shall be considered based on the
compensation the employee would have received in
the employees job classification if the employee
was not on industrial leave - Remember to record prior service on the Form 11
- Remember to record any leave without pay and
industrial in members record on the Form 11 - Note The Benefits staff will review the salary
reported by the local board and check it against
the members contributions paid into the system
for the dates submitted, however if it looks like
there are higher contributions paid into the
system that are not in the high 3-year
calculation as submitted by the local board, the
Benefits staff will ask for a second review of
the salary by the local board.
16WHAT IS COMPENSATION?
- Compensation means, for the purpose of computing
retirement benefits, base salary, overtime pay,
shift differential pay and holiday pay paid to an
employee by the employer on a regular monthly,
semi-monthly, or biweekly payroll basis and
longevity pay paid to an employee at least every
6 months for which contributions are made to the
system pursuant to 38-843, subsection D.
Compensation does not include, for the purpose of
computing retirement benefits, payment for unused
sick leave, payment in lieu of vacation, payment
for compensatory time or any other fringe
benefits. (A.R.S. 38-842) - For the purposes of this paragraph, base salary
means the amount of compensation each employee is
regularly paid for personal services rendered to
an employer before the addition of any extra
monies, including overtime pay, shift
differential pay, holiday pay, longevity pay
fringe benefit pay and similar extra payments.
17DEADLINES FOR RETIREMENT PAPERWORK
- Submit retirement paperwork for all benefits by
the 10th of each month - Ensure paperwork is filled out correctly and
completely - Fill in the final contribution amount (estimate
if needed) on the Form 11 - Check for all signatures by the member and local
board/employer - Include all supporting documents to include
medical documentation for children listed as
disabled and full-time school enrollment for
eligible children 18-22 - Tax forms need to be marked correctly (Note
Accidental, Temporary, and Catastrophic
disabilities under 20 years of service are
tax-exempt, however the member must complete the
tax forms claiming the exemption) - Copy of minutes need to be submitted with all
disability applications - Certified copy of the divorce decree papers with
raised seal (if applicable) (it may delay
payment) - Note Please make sure you are using most
current forms dated September 2006. - The date is shown in the upper right
hand corner of the forms 9/06.
18SUGGESTIONS
- Submit estimates (FORM 11) for review before the
member signs paperwork - Print out the statutes and retirement instruction
manual from the website for reference - Encourage all local boards to use the electronic
spreadsheets to process retirements versus
manually filling in each individual form
19SPREADSHEETS
- Use for all types of retirements
- Spreadsheets have changed so be sure to download
the most current version available on website - DROP and Reverse DROP have its own spreadsheet
now from the Normal/Survivor - Just fill in the Input Sheet and the rest of the
forms are filled in automatically (See handout
for special instructions) - Save the file and email to our Benefits Staff to
review the estimate and upload the retirement
into our system (Dont forget to mail in the
original signed forms) - Bonnie_at_psprs.com
- Don_at_psprs.com
- Tara.Smith_at_psprs.com
- Joann.Lowey_at_psprs.com
- Della_at_psprs.com
- ROrtega_at_psprs.com
20Whats happening?
- Document Scanning
- Bar Codes on forms
- Members Handbook
- IT Project Member/Retiree information on web
- Retiree Newsletter
- DRO Domestic Relations Order (new legislation)
- Fire Fighter Cancer Insurance (includes police
officer)
21WEBSITE RESOURCESwww.psprs.com
- General
- Statues, Summary of Benefits, FAQs, Legislation
- Members
- Reverse DROP Estimate, Retirement Estimate,
Common Forms, Preparing for Retirement, Insurance
Information - Employers
- Forms, Spreadsheets, Oath of Office
- Slides
- FF Cancer Insurance, Local Board Training
- Learn About
- Taxation of Pension Amounts
- Survivors (Links to resources also on main
menu) - Disability Slides
22BENEFITS STAFF
- Bonnie Brown (Manager of Benefit Services)
- Joann Lowey (Team Lead/DROP)
- Don Mineer (Team Lead/Retirements)
- Tara Smith (Retirements)
- Della Hieb (Retirements)
- Paul Hemmes (Retirements/Web Services)
- Robert Ortega (Retirements)
-
23PERMANENT/BASE SUBSIDY
-
- The Public Safety Retirement System
provides a monthly, premium benefit payment to
eligible, enrolled retirees. (To be eligible a
member must be enrolled for his medical and or
dental insurance through an employer of the
system or one of the state of Arizona programs.)
This payment is applied to health insurance
premiums and is intended to help lessen the
out-of-pocket insurance cost to retirees. - More commonly known as subsidy. The
allotted subsidy amount is based upon insurance
plan type (family or single) and Medicare
eligibility. -
- 150 is the subsidy for a member who is not
Medicare eligible and on single coverage, 100 is
the subsidy for member that is on Medicare. - 260 is the subsidy for a member who is not
Medicare eligible nor his dependents and on
family coverage , 170 is the subsidy if everyone
on the plan is on Medicare, 215 is the subsidy
if just one person on the plan is on Medicare. - There have been cases where a member is eligible
for more than one subsidy, in these cases both
subsidys would be applied toward members premium
to reduce the out of pocket -
-
24Rural /Temporary Subsidy
- In June 2007, the AZ State Legislature passed
HB 2311 this extended the temporary, rural
subsidy for 2 additional years. The rural subsidy
is provided only to qualified AZ retirees who
meet the following requirements - 1. Retiree MUST be Medicare eligible (A B),
not eligible if spouse is Medicare. - 2. Retiree MUST reside within specified AZ
counties - where no HMO-type service is available
- 3. Retiree MUST pay a minimum out of pocket prior
to receiving subsidy -
- Qualifying counties currently are
- Mohave, Apache, Gila and Navajo
-
- Out of Pocket amounts are
- 100.00 for single, 200.00 retiree 1 both
Medicare, 400.00 combination with member only
Medicare -
- Subsidy amount that apply once out of pocket
has been met - 170.00 single, 350.00 retiree 1 both Medicare,
470.00 combination with member only Medicare. -
-
-
-
25 Insurance Contact Information
If you need further information you may visit our
website at www.psprs.com and click on the
Retiree Health Insurance or contact one of the
representatives listed below.
Annette Jorgensen Insurance Team Leader
annette.jorgensen_at_psprs.com (602) 255-5575
X2024 Stac
ey Alcott Insurance Specialist
stacey.alcott_at_psprs.com (602) 255-5575 X
2013
26(No Transcript)