Impact to existing and new (hired on or after 1-1-13) employees:
- Airtime – prohibits purchases of nonqualified service; however, applications received by CalPERS prior to 1-1-13 would still be eligible.
- Post-retirement employment- requires a 180-day “sit-out” period before a retiree could return to work unless the appointment is:
o Necessary to fill a critically needed position and has been approved by a governing body in a public meeting
o Retiree is eligible to participate in the Faculty Early Retirement Program (FERP)
- Forfeit pension benefits—felony conviction committed within the scope of official duties
- Retroactive pension increases—prohibit retroactive pension benefit changes that apply to service performed prior to the enhancement
Impact to employees newly hired on or after 1-1-13:
- Retirement contribution–employee will be responsible for contributing 50% of the pension contribution rate calculated by CalPERS that is used to fund the employee’s retirement benefit. The employer will pay the remaining 50%.
- New cap on compensation that can be applied to benefit formula—limits amount of compensation used to calculate the retirement benefit equal to the Social Security wage index limit ($110, 000 for 2012). This amount is adjusted annually based on the Consumer Price Index (CPI).
There is other language in the bill that may impact the CSU. We are working to identify those provisions and will provide you with periodic updates. In addition, we will be establishing a Pension Reform FAQ that will be available soon. In the meantime, you can forward your questions to BenefitsInsider@calstate.edu.