Increase in Deferred Comp Incentive

Posted on

Is it true the legislature passed a bill funding a $10 increase in the state match for deferred comp, that is the state will now match $35.00 per month instead of $25.00?
An appropriation bill has been passed to allow for an increase in the state’s contribution to the deferred compensation incentive plan. If this bill is signed into law, CitiStreet will work with the State of Missouri to implement this change as soon as administratively possible. The legislation submitted to the Governor for his consideration envisions the current $25 per month ($12.50 semi-monthly) match being changed in accordance with the following schedule:
Semi-Monthly Payroll (SAM II)
$12.50 - $14.99.....$12.50
$15.00 - $17.49.....$15.00
$17.50 or more......$17.50
Monthly Payroll (non-SAM II)
$25.00 - $29.99.....$25.00
$30.00 - $34.99.....$30.00
$35.00 or more......$35.00

More information will be provided to all participants regarding implementation of this proposal if it is approved by the Governor. Print Friendly and PDF

Does BackDROP go away after 35 years of service?

Posted on
I have gotten so many different stories about the backdrop I thought I would just ask. April 1, 2010 I will have all 5 yrs of my backdrop in. At that date I will have 33 yrs and 11 months in. I have been told that once I reach 35 yrs of service the lump sum on the backdrop goes away. If this is the case can I work beyond the 5 yrs backdrop until I have 34 yrs 11 months and then retire and still receive the back drop? Also I will only be 58 yrs old, so will I have to pay the 10% penalty if I am not 59 1/2? I plan on talking to a MOSERS rep soon and get all my questions answered. Until then thanks for your time.
Once you qualify for the BackDROP, you will be eligible to elect it as an option when you retire, regardless of how long you continue in service. If you reach at least age 55 (50 for a qualified public safety employee) in the year your service terminates, you will not be subject to the 10% premature distribution tax. Print Friendly and PDF

Did House Bill 1669 pass?

Posted on
Since the legislative session ends 16 May, I would like to know if anyone has heard of HB 1669 chances of passing this year or are the politicians merely trying to garner some votes by introducing Bills that sound good but have no chance of passing—as usual?
The 2008 legislative session ended May 16. House Bill 1669 did not pass. Print Friendly and PDF

Effect of raise or promotion after BackDROP date

Posted on

I have heard that any promotional raise or demotion, after the date I elect to start my backdrop will not affect either my backdrop nor my retirement pay, no matter how large the promotion or demotion. Is that true?
If you are eligible for the BackDROP and elect it at retirement, both the lump sum and continuing monthly benefit amounts will be calculated using your credited service and final average pay as of your BackDROP date. Consequently, any raise or demotion after your chosen BackDROP date would not affect the amount of your BackDROP distribution or your monthly retirement benefit.
The BackDROP option provides a way for you to receive a lump sum payment at retirement in addition to your ongoing monthly benefit. If you select this payment option, the monthly benefit payable on your actual retirement date is based on the benefit you would have been receiving had you left employment and retired on an earlier date, which is why a salary increase after that date does not affect your benefit. In addition, you will receive a lump sum payment equal to 90% of the life income annuity amount you would have received during the BackDROP period.
Whatever BackDROP date you choose, it must meet both of the following requirements. It must be:
  • On or after the date you were first eligible for normal (unreduced) retirement benefits.
  • Within the five-year period immediately prior to your actual retirement date.
Before you make a final decision regarding the BackDROP you may find it helpful to use the calculator on our website to review all of your payment options. You may also want to attend a Pre-Retirement seminar or contact a benefit counselor to ensure that you understand how the BackDROP works. Print Friendly and PDF

Possibility of receiving BackDROP payment without retiring

Posted on
Can one get a one or two-year backdrop and still continue working another year or two until retirement as long as that individual is qualified?
No, you cannot receive a BackDROP lump sum amount and continue working. The BackDROP is an option available to eligible members at retirement. You cannot elect the BackDROP until you actually retire. During the retirement process, you will receive a Retirement Election Form. On this form, you will make your BackDROP election (assuming you are eligible) and your benefit payment option election. Print Friendly and PDF

Annual leave when attending MOSERS' seminars

Posted on
Are you required to take annual leave to attend the preretirement seminar and money matters workshop?
This is a question for your human resources (HR) representative. Each agency has their own policy regarding leave to attend seminars and workshops. Print Friendly and PDF

Death before retirement

Posted on

Suppose an active employee of the State of Missouri has reached his early or regular retirement date - but has not retired; if this employee should die before he retires, will his surviving spouse get any part of his retirement - other than the life insurance?
Will the surviving spouse get any backdrop earned by the employee if he dies before he retires?
Morbid questions I know, but it came up in a discussion and I didn't know the answer. Thank you for your efforts.
If you pass away before retiring, your spouse would not be eligible for the BackDROP distribution. However, your spouse may be eligible to receive a lifetime survivor benefit.
Survivor benefits are payable to the eligible spouse or children of a vested general state employee who dies prior to retirement. Although survivor benefit payments begin the first of the month following the member’s date of death, they are not automatic. Each eligible benefit recipient must submit an
Application for Survivor Benefits with the required documentation. Once MOSERS receives and processes the application, the monthly benefits would begin.
To be eligible, your surviving spouse must be married to you on your date of death. The surviving spouse benefit (payable for the remainder of your spouse’s life) would be calculated as if you had retired the date of death and elected the Joint & 100% Survivor Option. (No adjustments are made in the calculation to recognize the fact that you may not have reached eligibility for normal retirement at the time of your death.)

If there is no eligible spouse (or the spouse’s benefit is no longer payable due to the death of the spouse), a total of 80% of your monthly base benefit will be paid to your natural or legally adopted child(ren) under the age of 21. If there is more than one eligible child, the benefit will be divided equally among them. The survivor benefit for each child will stop when they become age 21 with their portion then divided among any remaining eligible children. (If a child is totally disabled, the benefit does not stop at age 21 but rather is payable for the life of the child.) Print Friendly and PDF

Protecting solvency of the state pension

Posted on
With the current state of affairs in the Global economy, what types of safety guards do you have in place to protect the solvency of the State Pension. If we actually go into another depression, will the funds be there for the future state workers to draw upon. Would our pensions ever be reduced to keep it solvent?
We know this is a matter of concern to many of our members. In March Rick Dahl, the System’s Chief Investment Officer (CIO), addressed it in a message posted on our web site. What he said then continues to be valid. Please click on the following link to read his statement on the matter:
Message from CIO Print Friendly and PDF

MOSERS' view on House Bill 1669

Posted on
What is MOSERS view on House Bill 1669 giving certain veterans who have been state employees for a specified period of time two years of free creditable service in the Missouri State Employees Retirement System. Thank You.
The MOSERS Board of Trustees has adopted a governance policy with respect to legislation. This policy was developed to ensure that board members and staff act as fiduciaries first, and speak with one voice when taking official positions on legislation. The policy also reduces the potential for conflicts of interest by serving as the framework through which all legislative proposals are evaluated.
In most instances, MOSERS staff members serve as technical advisors. We review all proposed legislation affecting MOSERS programs, providing technical comments and fiscal (cost) information to members of the General Assembly who sponsor legislation, and the appropriate legislative oversight agencies. In accordance with the policy, staff will also offer alternatives and provide an unbiased analysis, including the pros and cons of proposals, when appropriate.
Exceptions to this neutral/technical approach allow the board and/or staff to support legislation that corrects potential legal problems or structural deficiencies or that adds protections to the trust. Legislation may be opposed if it threatens the trust or deprives members of vested benefits without an equivalent compensating benefit.
While many members may be supportive of HB 1669, it does not fall into the category of legislation on which we would take a position. It is highly likely that there are also members who are opposed to it, given that it would increase the state’s cost of benefits but only apply to a select group. The policy challenge for the General Assembly is in allocating limited expendable resources among employees and programs – they generally tend to be more receptive to benefits that apply to the masses rather than a select group – the same is true of members of the System. Print Friendly and PDF

Cost of purchasing military or public service time

Posted on

Why is it so expensive to purchase time (military or public) and what are the benefits for doing so?
Your total credited service (active and prior) is one of the factors used in the formula to calculate the amount of your retirement benefit. In other words, the more credited service you have, the higher your monthly benefit amount. Purchasing military or prior public service will increase your service with MOSERS, and in most cases, allow you to retire at an earlier date.
The process for determining how much is due in connection with a service credit purchase is established by state law. The statutory provision requires that we first determine what the contribution would have been for the number of years being purchased based on your salary and the contribution rate in effect when you were first hired.
The second step is to add simple interest to that amount for the period ranging from your date of hire to the date you make the purchase. It is often to your advantage, in terms of cost, to purchase service sooner rather than later to avoid additional interest costs.
The service purchase cost is generally significantly less than the System’s liability for that service. Any shortfall between what you pay for that service and the actual liability is factored into the state’s contribution rate. The MOSERS board certifies the actuarially determined rate required to fund your promised benefits in October each year and that rate is paid to MOSERS through state appropriations during the next fiscal year. In summary, while what it costs you to purchase military or other public service credit may seem high, it is generally heavily subsidized by additional state contributions.

Before you decide to purchase additional service credit, we recommend you contact a qualified financial advisor to determine how the purchase will affect your overall financial plan. The purchase of prior service credit must be completed before applying for retirement. Print Friendly and PDF

Military time counting toward retirement

Posted on
I hear that some of our military time will count towards retirement. Is that true?
There are provisions that allow you to purchase or receive automatic credit for your eligible active duty military service. This additional service credit will be used in determining your eligibility for retirement and calculating the amount of your benefit.
Purchase Provision:You may purchase up to four years of active duty military service credit performed prior to your last becoming a member of MOSERS. This includes active duty military training. Along with your
Application to Purchase Active Duty Military Service, MOSERS will need a copy of your DD214 or NGB 23 discharge form that verifies the following:
  • Your service was active duty.
  • Your service was in an eligible branch of the U.S. Armed Forces or reserve components (Army, Air Force, Navy, Marine Corps, Coast Guard, Army National Guard, or Air National Guard).
  • Your dates of service.
  • You were honorably discharged.
Automatic Credit Provision:If you are called to or volunteer for active military duty, you may be eligible to receive credit for your military service at no cost.
To be eligible for automatic military service credit, you must:
  • Have been employed by the state immediately prior to entering the armed forces.
  • Return to state employment within the timeframe specified by the Uniformed Services Employment and Reemployment Rights Act (USERRA).
  • Provide a copy of your military DD214 or NGB 23 honorable discharge form or other pertinent documentation to your employer upon reemployment.
  • Meet any other requirements under USERRA.
Detailed information regarding active duty military service may be found in our Acquiring Service Credit brochure. If you wish to obtain credit for your active duty military service, the acquisition must be completed prior to applying for retirement.
Proposed Legislation:
It may interest you to know that a bill was introduced during the 2008 legislative session. As presently drafted, the proposed House Bill 1669 would allow eligible members (including members who have already purchased up to four years of retirement credit based on past military service) to receive an additional two years of creditable service free of charge, subject to the provisions in the bill. Refunds would not be given to members who have already purchased service. The service provision will not be available unless the bill is passed by the General Assembly and signed into law by the Governor. You can track this legislation at the Missouri General Assembly’s website. Print Friendly and PDF