SB72 Frequently Asked Questions (FAQs)
SB72 PERA SOLVENCY
Q. I am a Tier 2 member. Did the vesting period change?
A: Yes, effective July 1, 2020, both current and future Tier 2 general and public safety members will have a five-year vesting period under all coverage plans (does not apply to Judicial and Magistrate members who first took the bench on or after July 1, 2014).
Q. I am a state employee under State General Plan 3. When will I see the 2% employee contribution increase in my paycheck?
A: Effective July 1, 2020, employee contributions will increase by 2%, in .5% increments over four fiscal years. The first .5% increment will increase employee contributions under State General Plan 3 to 9.42%. The employer contribution rate will increase by .5% each fiscal year as well.
Q. I am an Adult Correctional Officer member of State Police and Adult Correctional Plan 1. Will my contributions increase?
A: No, members of State Police and Adult Correctional Plan 1 are excluded from contribution increases. This is because the State Police and Adult Corrections Division is currently well-funded at 130%.
Q. I am a municipal/county employee. When will I see the 2% employee contribution increase in my paycheck?
A: There is a two-year delay before any municipal or county employee or their employers will see a contribution increase. Effective July 1, 2022 employee and employer contributions will increase by 2%, in .5% increments, over four fiscal years (FYs23, 24, 25 and 26).
Q. I am a Juvenile Correctional Officer employed by CYFD. Is it true Juvenile Correctional and Adult and Juvenile Probation and Parole Officers will be moved into the State Police and Adult Correctional Officer Plan 1?
A: Yes, Juvenile Correctional, Adult and Juvenile Probation and Parole Officers will be consolidated into the newly created State Police, Correctional Officer Member and Probation and Parole Officer Member Coverage Plan 1. Juvenile Correctional Officers and Probation and Parole Officers will participate in an election to adopt the new coverage plan. SB 72 requires an affected member to contribute under the new plan for at least 18 months to be eligible for payment under the new plan. Only future service credit will be under the new plan; there is no grandfathering of past service credit. In other words, the Tier 1 service credit enhancement will only be applied to future service credit.
RETIRED MEMBERS
Q. I am a retiree over the age of 75 years. Will I still receive a cost-of-living adjustment (COLA)?
A: Yes, effective July 1, 2020, if you are 75 years of age on or before June 30, 2020, you will receive a 2.5% COLA, an increase from the current 2% COLA. Disability retirees and retirees with pensions lower than $25,000 after 25 years of service also will receive a 2.5% COLA.
Q. What is the 13th “check” that everyone is talking about?
A: COLA-eligible retirees will receive a 2%, non-compounding, additional payment for the next three years (2020, 2021 and 2022). This payment will be paid in addition to your regular July pension payment.
Q. Did the COLA wait period change?
A: Effective July 1, 2020, retirees are eligible to receive a COLA after they have been retired two full calendar years.
Q. I am retired and currently in my seven-year wait period for a COLA. When will I receive my first COLA?
A: Current retirees in the seven-year waiting period who have been retired two full calendar years are also eligible for the 13th check July 1, 2020 and will be part of the “profit-share” COLA after the three-year period of 13th checks.
Q. I am a PERA retiree who returned to work for a PERA-affiliated employer before July 1, 2010. Will my COLA be reinstated?
A: Yes, effective July 1, 2020 you will receive a COLA. You are not eligible to receive retroactive COLAs.
Q. I am a PERA retiree. Will I be able to go work for an ERB-affiliated employer and still receive a COLA?
A: Yes, you will now be able to work for an ERB-affiliated employer and still receive a COLA. If you are COLA-eligible, you will automatically have your COLA reinstated July 1, 2020.
Q. How will PERA pay for the 13th “checks”?
A: PERA received a $55 million General Fund appropriation to cover the cost of the 13th check payments to eligible retirees in FY21, 22 and 23.