MOSERS and Social Security

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I am approaching the magic age of 62 and I will be taking early social security. If the feds raise the early retirement age to 65 will the temporary benefit in the MSEP 2000 plan change or remain at age 62? It will certainly change our plans.
The short answer to your question is that the MOSERS temporary benefit ends at age 62. It is not dependent upon eligibility for or if you take reduced social security benefits. Any change to the temporary benefit would require the Missouri legislature to pass legislation to revise it (i.e. it wouldn’t be a MOSERS Board decision).
This question has been asked and answered in a variety of ways on Rumor Central in the past and those additional details might be of interest to you. If you go to the "Labels" column on the right side of the Rumor Central screen, scroll down and click on "Temporary Benefit" you will see a number of entries on the topic. In particular, you might be interested in the special note we posted in July, 2007 to alert members of the following:
One final note concerning when the MOSERS temporary benefit ends and when early social security benefits begin.
We recently became aware that there is a timing issue here that will affect most retirees. The MOSERS temporary benefit ends the month you turn age 62. According to the social security website, you must be age 62 for a full month before early social security benefits can begin. Also, the week of the month on which you receive your social security benefit depends on which day of the month you were born. (Several years ago, social security started staggering monthly payments throughout the month based on birthday rather than making all payments at the first of the month.) For these reasons, there can be a lag period between the time the MOSERS temporary benefit ends and the first social security payment is received. It’s important to be aware of this and have a plan in place to cover any shortfall that may occur during the transition.
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Is the MOSERS fund ever used to fund other budget priorities?

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When was the last time the MOSERS pension fund was "raided" to fund other budget needs of the state?

MOSERS is set up as a trust fund and is separate from state general revenue, so the funds can’t be “raided.” The statutory language is found in RSMo 104.436.4, which says "These amounts are funds of the system, and shall not be commingled with any funds in the state treasury."
MOSERS is stable and secure, and the state of Missouri has consistently contributed the amount recommended by the actuary and certified to the state by the MOSERS board of trustees.


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Who Makes Proposals to Change Retirement Benefits?

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Every year there seems to be proposals submitted to the legislature that could influence retirement decisions, such as the proposal this year to give a $2,000 bonus per year of employment. Who makes these proposals?
Only members of the legislature can propose new laws or changes to existing laws in the form of bills that make their way through the legislative process. The proposal this past legislative session, which did not pass, was to offer $1,000 cash for each year of service up to 20 years. These types of proposals are designed as incentives for employees to leave state employment, thereby reducing the state’s payroll and fringe benefit obligations. The Missouri House of Representatives offers a chart detailing how a bill becomes law, which may aid in understanding the process.

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Is the legislature and/or MOSERS considering changing retirement benefits for current state employees?

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I read with interest the recent article in the Jefferson City News Tribune regarding pension reform for Missouri State employees. This has prompted a number of questions in my office and I would very much appreciate if you would address them. 1. Is the legislature and/or MOSERS considering changing the pension/retirement benefit for current Missouri State Employees? During the recent special session, all communication from the legislature/MOSERS clearly indicated that changes would be directed at new hires only. However, the mentioned news article would seem to indicate that these earlier statements were not completely true and attempts will be made to impact benefits for current employees in upcoming sessions. Is this the case, and if so, what changes are being considered?
2. Is it legally possible for pension/retirement benefits that are held by vested Missouri State Employees to be changed or taken away?
3. Does state law protect the retirement benefit of a vested Missouri State Employee?
4. Does Missouri State law view state employee retirement/pension benefits as Gratuity, as Contract, as Promissory Estoppel, or as Property Interest?
5. Are there any court cases that establish legal precedent for what changes are can and can't be made to the retirement/pension benefit of a vested Missouri State Employee?Finally, I would suggest that you put more information on your website that speaks honestly and directly to this issue. This is a topic of great interest to most state employees with over 10-15 years experience. There is much discussion and rumor surrounding the issue.

We also read the article to which you refer with great interest and responded with a letter to the editor of the Jefferson City News-Tribune that was published in the August 15, 2010 edition of that paper. We also posted the letter on our website.
Regarding the first question, we are not aware of any proposals to make changes to the retirement plan’s present benefit provisions that would in any way diminish or impair benefits accrued to date or that will be accrued in the future by present active and retired employees.
Your remaining questions are generally addressed in the Revised Statutes of Missouri in sections 104.540 (MSEP) and 104.1054 (MESP 2000) which, in pertinent part, read as follows:
Benefits are obligations of the state—benefits not subject to execution, garnishment, attachment, writ of sequestration—benefits unassignable—reversion of benefits, when—refund received, when.—
1. The benefits provided to each member and each member's spouse, beneficiary, or former spouse under the [law] are hereby made obligations of the state of Missouri and are an incident of every member's continued employment with the state. No alteration, amendment, or repeal of the [law] shall affect the then-existing rights of members, or their spouses, beneficiaries or former spouses, but shall be effective only as to rights which would otherwise accrue hereunder as a result of services rendered by a member after such alteration, amendment, or repeal.

If legislation were enacted that might be construed to be a diminishment or impairment of benefits, it is highly probable that resolution of the matter would ultimately be determined by our court system.
In the absence of any specific proposal to change plan benefits for present members, we are not positioned to offer opinions regarding how any benefit law change might be viewed by the courts. However, if any such proposals are forthcoming you can rest assured that they will be comprehensively vetted and the results will be presented to the policy makers who are proposing or considering plan changes.
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Can the MOSERS Board Make Changes to Benefits?

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I heard that the MOSERS Board of Trustees was only one vote short of changing benefits for existing members. That has everyone worried that next year the Board will vote to apply contributions to existing employees, change eligibility for retirement, or eliminate the BackDROP for existing employees. Is that true?
NO. This is not true. The MOSERS Board of Trustees did not come within one vote of changing benefits for existing members. The board does not have the authority to make changes to retirement laws and cannot make changes to retirement benefits. Only the legislature has the authority to do that. We have no way of knowing what the legislature will do, and MOSERS is not currently aware of any retirement benefit changes being considered by the General Assembly. We will continue to keep members informed.

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