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The Public Employees Retirement System (PERS) was established on July 1, 1961 for the purpose of providing retirement benefits for employees of the State and other political subdivisions. PERS has approximately 35,800 active members and approximately 20,500 retirees receiving annuity benefits. PERS is funded by employee and employer contributions. An active member contributes 4.5% of his or her gross monthly salary to the plan. The employer contributes an additional 11% of the member’s gross monthly salary for a total combined contribution equal to 15.5%. All employee contributions are tax deferred. Contributions as a percentage of payroll for members and employers are established by statute, subject to legislative limitations. The expected contributions are reviewed to assure that they result in actuarially sound funding for the plan.
The number of state agencies in 2002 and fiscal year 2003 was: 204
| June 1999 | June 2000 | June 2001 | June 2002 | June 2003 | June 2004 | |
|---|---|---|---|---|---|---|
| Cities and towns | 193 | 193 | 193 | 190 | 120 | 103 |
| Counties | 55 | 55 | 55 | 55 | 55 | 55 |
| Special districts | 231 | 228 | 234 | 251 | 339 | 366 |
| Total | 479 | 476 | 482 | 496 | 514 | 524 |
A regular retirement benefit, paid in equal monthly installments, is an amount equal to 2% multiplied by the member’s years of credited service multiplied by the member’s Final Average Salary (FAS). Final Average Salary refers to the average annual salary from the highest 36 consecutive months within the last 10 years of employment. Normally, this figure will come from the last 3 years of employment. Lump sum payments, with the exception of annual increment pay, will not be used to increase any retirement benefit.
Chapter 5, Article 10 of the West Virginia Code establishes the plan provisions for PERS. In certain circumstances, this Article also permits members of the Teachers’ Retirement System to transfer accumulated service credit and member contributions into the Public Employees Retirement System.
RETIREMENT BENEFITS
Regular Retirement:
A member who is currently working for a participating PERS agency may:
Retire with full benefits at age 55 if age plus contributing service equals 80 or more.
Retire with full benefits at age 60 if he or she has 5 or more years of contributing service.
Retire with reduced benefits at age 55 if he or she has 10 or more years of credited service.
Deferred Retirement:
A member who is not currently working for a participating PERS agency and has not withdrawn his or her contributions may:
Retire at age 62 with full benefits if he or she has 5 or more years of credited service, at least 3 of which must be contributing service and was hired prior to July 1, 2002.
Retire at age 62 with full benefits if he or she has 5 or more years of contributory service and was hired on or after July 1, 2002.
Retire with full benefits at age 55 if age plus contributing service equals 80 or more.
Retire with reduced benefits at age 55 if he or she has between 20 and 25 years of service.
Retire with reduced benefits if less than 55 years of age and he or she has 30 or more years of credited service.
Retirement benefits are not automatic.
You must apply to the Board for
retirement benefits.
A full retirement benefit, paid in equal monthly installments, is an amount equal to 2% multiplied by the member’s years of credited service multiplied by the member’s Final Average Salary (FAS). Final Average Salary refers to the average annual salary from the highest 36 consecutive months within the last 10 years of employment. Normally, this figure will come from the last 3 years of employment. Lump sum payments, with the exception of annual increment pay, will not be used to increase any retirement benefit.
2% x Years of Service x FAS =
Annual Retirement Benefit
(Straight Life Benefit)
ARREARS PAYROLL
Members who are paid in arrears should carefully evaluate their effective termination date and its effect on his or her final average salary calculation.
Straight Life: A lifetime annuity payable monthly to the member determined under the full benefit formula without adjustment. There are no death benefits under this option.
Option A - 100% Joint and Survivor: A reduced annuity payable monthly to the member for his or her lifetime. Upon the death of the member, the named survivor will receive the same amount for his or her lifetime.
Option B - 50% Joint and Survivor: A reduced annuity payable monthly to the member for his or her lifetime. Upon the death of the member, the named survivor will receive one-half of the monthly payment for his or her lifetime.
The named survivor in both Option A and Option B must have an insurable interest in the life of the retiree such as a spouse, child, parent, or other dependent. With all the above options, any unpaid employee contributions, plus 4% interest, remaining at the retiree’s or survivor’s death, will be refunded to the named beneficiary or estate.
The very first benefit payments due to a retiree or beneficiary will be mailed directly to the recipient’s home address. Following the first payment, benefit payments are credited by direct deposit to retiree accounts on the 25th of each month, except the month of December, when retiree accounts are credited on the 18th. If the 25th (or December 18th) falls on a weekend or holiday, direct deposits are processed on the prior full business day.
Retirants will receive full benefits from PERS regardless of Social Security income or other private sector income or retirement benefits.
Distributions must start by April 1 of the year following the later of reaching age 701/2 or the date you terminate employment.
RETIREMENT BENEFIT ESTIMATE
Approximately 6 months prior to retirement eligibility, members should contact the Board to request an estimate of potential benefits under all three retirement annuity options. An estimate is essential to ensure that the member can make an informed decision regarding his or her retirement options.
USE OF UNUSED SICK AND ANNUAL LEAVE AT RETIREMENT
Additional Service Credit Alternative: This alternative is available to PERS members who have accrued annual and/or sick leave days at the time of retirement. PERS members may elect to acquire additional credited service to be applied on the basis of 1 month of service credit granted for each 10 days of unused accrued annual and/or sick leave.
Purchase PEIA Insurance Coverage Alternative: This alternative is available to PERS members who participate in a Public Employees Insurance Agency (PEIA) insurance plan at the time of retirement. PERS members may elect to use unused accrued annual and/or sick to purchase health insurance under PEIA based on the following rules:
Unused leave CANNOT be divided and used for both service credit and PEIA coverage. Members who retire from a city, county, or other non-direct employers of the State should contact their employer or PEIA regarding eligibility for PEIA insurance coverage. If the member plans to separate from employment prior to eligibility for a retirement annuity (deferred retirement), the member should refer to his or her employer's leave policy to determine if unused leave is cancelled at the time of separation from employment.
DISABILITY RETIREMENT
Work Related Disability - An active member of PERS may qualify for a work related total and permanent disability retirement with no minimum years of service required. He or she must be receiving (or have received) Workers’ Compensation benefits on account of such disability.
Non-Work Related Disability - A member must have 10 or more years of credited service to quality for a non-work related total and permanent disability retirement.
Disability benefits shall not be less than 50% of a member’s Final Average Salary. At age 65 the benefits are calculated on actual years of service, and may be reduced, but the straight life benefit or equivalent may not be less than 20% of the Final Average Salary.
If a member wishes to change a beneficiary(ies), they must complete a new beneficiary form and return it to the WV Consolidated Public Retirement Board (CPRB). The member should keep a copy of this form for his or her records. If a member’s family situation changes (birth, death, divorce, etc.), his or her beneficiary designation should be reevaluated.
DEATH PRIOR TO RETIREMENT - BENEFICIARY OPTIONS
Beneficiary options are selected based upon specific categories. PERS members may select beneficiary options based only upon the specific category that describes his or her particular circumstance at the time a beneficiary form is completed (i.e., date of hire, years of service and marital status).
Category 1:
Less than 10 years of credited service regardless of original date of hire or marital status:
A member who falls under this category may elect to name a beneficiary(ies) to receive a lump sum payment of his or her employee contributions plus 4% interest.
Category 2:
Hired for the first time before or on June 9, 2006, has 10 or more years of credited service, and is married at the time of death:
A member who falls under this category may elect one of the following options:
(A) The member may elect a 100% Joint and Survivor, calculated as if the member had retired the day preceding the date of his or her death, paid to his or her surviving spouse. The member may also elect to name an alternative beneficiary, who has an “insurable interest” in the life of the member, to receive the 100% Joint and Survivor annuity if the surviving spouse pre-deceases the member OR the member may elect to name a beneficiary to receive a lump sum payment of his or her employee contributions plus 4% interest if the surviving spouse pre-deceases the member.
(B) If the “Spouse’s Waiver of Survivorship Annuity” section is completed, the member may elect to have the 100% Joint and Survivor annuity, calculated as if the member had retired the day preceding the date of his or her death, paid to a named beneficiary who has an “insurable interest” in the life of the member OR the member may elect to name a beneficiary to receive a lump sum payment of his or her employee contributions plus 4% interest.
Category 3:
Hired for the first time before or on June 9, 2006, has 10 or more years of credited service and is NOT married at the time of death:
A member who falls under this category may elect one of the following options:
(A) The member may elect to name a beneficiary(ies) to receive a lump sum payment of his or her employee contributions plus 4% interest.
(B) The member may elect to have a 100% Joint and Survivor annuity, calculated as if the member had retired the day preceding the date of his or her death, paid to a named beneficiary who has an “insurable interest” in the life of the member.
(C) The member may elect not to name a beneficiary and have his or her pre-retirement death benefit paid as a monthly annuity, calculated as though the member had retired as of the date of his or her death and elected a Straight Life annuity, to a minor child or children until the minor child or children attains age 21 or sooner marries or becomes emancipated.
*In no event shall any child or children receive more than $250.00 per month.
Category 4:
Hired for the first time after June 9, 2006, has 10 or more years of credited service and is married at the time of death:
A member who falls under this category may elect one of the following options:
(A) The member may elect a 100% Joint and Survivor annuity, calculated as if the member had retired the day preceding the date of his or her death, paid to his or her surviving spouse. The member may also elect to name a beneficiary to receive a refund of his or her employee contributions plus 4% interest in the even the surviving spouse pre-deceases the member.
(B) If the “Spouse’s Waiver of Survivorship Annuity” section is completed, the member may elect to have the 100% Joint and Survivor annuity, calculated as if the member had retired the day preceding the date of his or her death, paid to a child who is financially dependent upon the member by virtue of a permanent mental or physical disability, OR the member may elect to name a beneficiary to receive a lump sum payment of his or her employee contributions plus 4% interest.
*Evidence of disability must be provided and the disabled child must be named sole beneficiary.
Category 5:
Hired for the first time after June 9, 2006, has 10 or more years of credited service and is NOT married at the time of death:
A member who falls under this category may elect one of the following options:
(A) The member may elect to name a beneficiary(ies) to receive a lump sum payment of his or her employee contributions plus 4% interest.
(B) The member may elect to have a 100% Joint and Survivor annuity, calculated as if the member had retired the day preceding the date of his or her death, paid to a child who is financially dependent upon the member by virtue of a permanent mental or physical disability.
*Evidence of disability must be provided and the disabled child must be named sole beneficiary.
(C) The member may elect not to name a beneficiary and have his or her pre-retirement death benefit paid as a monthly annuity, calculated as though the member had retired as of the date of his or her death and elected a Straight Life annuity, to a minor child or children until the minor child or children attains age 21 or sooner marries or becomes emancipated.
*In no event shall any child or children receive more than $250.00 per month.
EMPLOYMENT AFTER RETIREMENT
If a retiree becomes permanently employed by a participating employer, payment of his or her annuity shall be suspended during his or her reemployment, and he or she shall again become a contributing member of the retirement system. If the reemployment is for a period of one year or longer, a new retirement benefit shall be calculated based on the additional employment.
A retiree may accept temporary employment from a participating employer so long as he or she does not receive compensation in excess of $15,000 during any one calendar year.
REINSTATEMENT OF PREVIOUSLY WITHDRAWN SERVICE
Any member who has been re-employed for one full year by a participating PERS employer may purchase previously withdrawn PERS service, provided that they redeposit the withdrawn funds plus interest. Reinstatement payments must begin within two years of the return of employment the full amount repaid (in a lump sum or payments) within five years of the return to employment.
MILITARY SERVICE
Any member of PERS who served on active duty in the armed forces of the United States during any period of compulsory military service (“The Draft”) or during any period of armed conflict as outlined in West Virginia Code § 5-10-15 may be entitled to receive credited service in PERS at no cost for such military service, not to exceed five years. Members who have a break in employment as a result of active military service may be entitled to purchase additional military service credit as provided by federal law.
OUT OF STATE SERVICE
A member of PERS may purchase up to five years of service credit for public employment performed in another State. However, the member cannot be vested in the other State’s retirement system or receiving an annuity from such plan. Purchased out-of-state service may not be used to establish eligibility for a retirement benefit in PERS.
TERMINATION OF EMPLOYMENT
If a member terminates employment prior to the time he or she qualifies for retirement benefits and has accrued at least five years of contributing service, contributions may be left on deposit until he or she qualifies for retirement benefits. The member may also choose to withdraw his or her employee contributions (plus 4% interest with two or more years of contributing service) from the plan after termination of his or her employment.
Employer’s contributions are not eligible to be withdrawn and they remain with the retirement system. Once the member withdraws contributions from the system, he or she forfeits all future retirement and disability benefits.
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Public Employees Retirement System
Plan Description