CalPERS Retirement System
Other CalPERS Programs
Faculty Early Retirement Program (FERP)
Part-Time/ Seasonal/ Temporary Retirement Plan (PST)

 

CalPERS Retirement System

The California Public Employees Retirement System is the defined benefit retirement system in which CSU Monterey Bay participates. CalPERS is coordinated with Social Security and membership is mandatory for those persons employed full time for more than six months or part-time (50 percent or more) for one year. Active CalPERS members who are hired at CSUMB automatically contribute to CalPERS regardless of the nature of their employment. Temporary faculty are required to enter CalPERS membership commencing with the third consecutive semester of appointment at half time or more.

CalPERS is considered one of the biggest and most stable pension funds in the country. CSU employees are generally covered by the CalPERS state, first tier, 2 % @ 55 program. Public safety officers are covered by the 3 % @ 55 program. For additional information contact HR.

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Working after Retirement for a CalPERS Covered Employer

Recent information from CalPERS, and rules from the IRS, provide the following guidelines for employees who retire before the normal retirement age (55) and return to work. CalPERS recommends the following to comply with the federal requirements for retiring members and employers:

  • Prior to a member's service retirement, there can be no agreement to render service after retirement (either verbal or written) by members who retire before reaching their normal retirement age, regardless of the length of the separation.
  • A member/retiree who has not reached their normal retirement age must have a separation from service prior to returning to CalPERS-covered employment. Normal retirement is taken to mean the age specified in the retirement formula, e.g., age 55 years for the "2%@55" formula.

Please refer to HR Tech Letter 2004-11 at: /

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Service Retirement Eligibility

Employees must be at least age 50 and have five years of service credit to apply for service retirement.

Three factors are used to calculate retirement allowance:

  1. Service credit
  2. Benefit factor based on age at retirement
  3. Final contribution (or highest 12 month average salary, if different)

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Service Credit

CalPERS members earn service credit for each year or partial year they work for a CalPERS-covered employer. It accumulates on a fiscal year basis, July 1 through June 30, and is one of the factors used to calculate your future retirement benefits.

In some cases, you may be able to purchase additional service credit that can help you maximize your retirement benefits. First, you should check your latest Annual Member Statement against your own employment records. Look for times you might have, for example, withdrawn your CalPERS contributions, were in the military, took a leave or break in employment, etc. Then review the Service Credit Purchase Options information to see if you may be eligible for any of the available options.

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View Service Credit Purchase Online

CalPERS is pleased to announce that it is now easier than ever for members to view their service credit purchase request status using My CalPERS.

My CalPERS online service lets members:

  • View the date CalPERS received the member's service credit purchase request
  • View the service credit purchase type
  • View the date CalPERS mailed service credit information to the applicant
  • View the date CalPERS received the member's formal service credit purchase election
  • View the service credit processing status

Before using this service, CalPERS members must first obtain a User ID and Password by registering on the My CalPERS website at www.calpers.ca.gov. Members who already have a User ID and Password can begin using the online service immediately.

For further assistance, please call CalPERS toll free at 888 CalPERS (or 888-225-7377), Monday through Friday, 8:00 a.m. to 5:00 p.m.

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Vesting

As a CSU employee, if you are a CalPERS member, you can become vested after five years of full-time equivalent service with the CSU. Vested members are eligible for service retirement as early as age 50. To be eligible for lifetime medical and dental benefits, employees must meet the CSU vesting requirements and retire within 120 days of their separation date with the CSU.

 

CalPERS vesting requirements vary for each CalPERS employer. The employer you retire with determines the vesting requirements you are subject to, regardless if you are considered vested by CSU standards. For example, should you be vested with the CSU and resign, yet prior to retirement regain CSU employment, you would still be considered vested by CSU standards and would be eligible for CSU service retirement benefits.

 

Vesting eligibility can vary for each individual, as there are many factors involved. It is recommended that you contact HR for specific information as it relates to your situation.

 
Contributions

The employee's monthly contribution is 5 percent of gross salary, less an exclusion allowance for coordination with Social Security. Employer contributions vary annually. Employee contributions are made on a pre-tax basis.

CalPERS uses the contributions of the employee and the employer as well as income from investments to pay for employee benefits. Interest is credited to contributions annually as of June 30. Statements are sent to each member in October.

In the event that you leave CalPERS-covered employment, you can do the following with the employee portion only:

  • Elect a refund of your contributions. A refund terminates your memberships in CalPERS. If you later return to CalPERS- covered employment you can buy back the service credit by returning your withdrawn contributions plus interest.
  • Leave your funds in CalPERS and withdraw at a later date if you are not a vested member
  • Request a rollover to an Individual Retirement Account (IRA)

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Application for Retirement

Employees wishing to apply for service retirement should contact CalPERS directly and/or HR for assistance. To ensure timely processing, the application should be submitted to CalPERS 90 days before your retirement date. Your effective retirement date cannot be earlier than the first of the month in which your application is received. CalPERS publishes retirement brochures and offers retirement and financial planning seminars locally on a regular basis. Employees thinking about retirement are strongly encouraged to notify HR and attend these events. To find out more, please visit the CalPERS website at: http://www.calpers.ca.gov/ or call CalPERS at (888) 225-7377.

 
Unused Sick Leave

The CSU contract provides for conversion of unused sick leave to additional service years on a percent basis. One year of service is equivalent to 250 days or each unused sick leave day is equivalent to .004 of a fiscal year.

 
Benefit Settlement Options

At retirement, the highest allowance (called the unmodified allowance) may be chosen or an employee may take a reduction and choose one of six other optional settlements, which may provide a beneficiary a lifetime benefit.

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Benefits after Retirement

If you are eligible to retire, you will receive the full state contribution for medical premiums for you and your spouse (enrolled dependents up to age 23) for as long as you live if you meet the following requirements:

Retire within 120 days of separation from CSU employment and draw a lifetime monthly benefit.

Member must be enrolled under his/her own name or as a dependent under the spouse's CalPERS health and dental plan at the time of separation. (Individuals participating in a "Flex" program are considered enrolled in the CalPERS Health Program.)

CSU currently pays for retiree dental premiums consistent with the above criteria.

CSU Retiree Vision Plan

SB 235, the CSU Retiree Vision bill, was signed into law by the governor. As a result, the Chancellor's Office has developed the vision plan that will be offered to eligible CSU retirees. This vision plan will be retiree paid, is a 12- month committment, and benefits will mirror the active employee plan we have with VSP. For more information, please call VSP at 1-800-877-7195.

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Other CalPERS Programs

 
Pre-Retirement Death Benefit

If an active CalPERS member dies before he/she is eligible for retirement, a death benefit of $5,000 group term life insurance plus six months salary and the return of employee contributions, plus interest, will be provided to the designated beneficiary. If the member is eligible to retire at the time of death, other optional benefits may apply.

Beneficiaries: CalPERS has established beneficiaries that are automatically designated to receive benefits in the event of the employee's death.

 
Disability Retirement

You may apply for disability retirement benefits if you become disabled and cannot work. Five years of service credit with CalPERS is necessary, but there is no minimum age requirement.

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Emergency Retirement

CalPERS will expedite retirement processing for those who are terminally ill or facing imminent death. Contact CalPERS or HR immediately if there is a need for emergency retirement.

Reciprocity

CalPERS has established agreements with many public retirement systems that allow movement from public employer to public employer within a specified time limit without losing valuable retirement and related benefit rights. This is called "reciprocity."

There is no transfer of funds or service credit between retirement systems when you establish reciprocity. You become a member of both systems and are subject to the membership and benefit obligations and rights of each system (for example, minimum retirement age), except as modified by the reciprocity agreement.

Upon retirement, separate retirement allowances are received from each system, and you must apply to retire from each system separately. You must retire on the same date from all public retirement systems participating in a reciprocal agreement for all benefits of reciprocity to apply.

CalPERS has an agreement with the State Teachers' Retirement System, Judges' Retirement System, and Legislators' Retirement Systems that provides similar benefits, although there is no reciprocity between the systems. For more information regarding benefits arising from movement to a non-reciprocal retirement system contact HR.

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Faculty Early Retirement Program (FERP)

FERP allows retired faculty members to work up to five years after retirement. Timebase worked is limited to 50 percent of the time base in the year prior to retirement (working one semester at full-time or working half-time throughout the academic year for most full time faculty). Tenured faculty and librarians age 55 or older at the time of entry into the program are eligible. Counselor faculty unit employees are excluded. This is a negotiated benefit.

 
Pre-retirement Reduction in Time Base Program (PRTB)

PRTB allows academic employees to phase into retirement through a reduction in time base to an average of two-thirds, one-half, or one-third of full-time for a maximum of five years while maintaining full retirement credit and other benefits.

 
Post-Retirement Program

The Post-Retirement Program allows retired employees and FERP participants, with approval, to work at the university for a maximum of 960 hours per fiscal year or 50 percent of the hours employed during the last fiscal year of service prior to retirement. Non-academic employees may work a maximum of 960 hours per calendar or fiscal year.

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Part-Time/Seasonal/Temporary Retirement Plan

The federal Omnibus Budget Reconciliation Act (OBRA) of 1990 requires that all public employees who are not members of a retirement system be covered either by a qualified retirement plan or by Social Security. In response to this legislation, the CSU established the Part-time/Seasonal/Temporary (PST) Retirement Plan for certain CSU employees who do not meet the eligibility requirements for participation in CalPERS. This plan is administered by the Department of Personnel Administration.

 
Eligibility

You are covered under the PST Retirement Plan if you do not meet the eligibility requirements for membership in CalPERS and are not covered by Social Security.

 
Contribution

Your contributions are tax deferred and are based on 7.5 percent of gross salary. The university does not provide a contribution. Individual account statements are provided once each year, usually during August. For more information, please read this PST Fact Sheet.

 
Payment

You are eligible for a distribution after you retire or separate from all state employment. For more information on payment options or to access the Benefit Payment Application, please read the following: PST Payment.

 

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Posted by Kristi McMahon on Mar 01, 2012 -