PUBLIC EMPLOYEES RETIREMENT SYSTEM (PERS)

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 36,573 active members and approximately 23,460 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. Until June 30, 2013, the employer will contribute an additional 14.0% of the member's gross monthly salary for a total combined contribution equal to 18.5%. Effective July 1, 2013, the employer will contribute an additional 14.5% of the member's gross monthly salary for a total combined contribution equal to 19%. All employee contributions currently remitted are tax deferred. Contributions for members, as a percentage of payroll, are established by statute, and are subject to legislative limitations. The expected contributions are annually reviewed to assure that they result in actuarially sound funding for the plan.

"Board", when used in the following sections refers to the West Virginia Consolidated Public Retirement Board.

RETIREMENT BENEFITS:

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In order to qualify for retirement benefits, a member of PERS must meet eligibility requirements.

A member who has not separated from employment with a participating PERS agency may:

-Retire with full benefits at age 55 if age plus contributing service equals 80 or more. (Known as the Rule of 80).
-Retire with full benefits at age 60 if he or she has 5 or more years of contributing service.
-Retire at age 55 with reduced benefits if he or she has 10 or more years of service.
-Retire with reduced benefits if less than 55 years of age and he or she has 30 or more years of service.

A member who has separated from employment with a participating PERS agency and has not withdrawn his or her contributions may: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. (Known as the Rule of 80).
-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.

Special Note Regarding Effective Date of Retirement: Effective date of retirement is dependent upon termination of employment, meeting retirement criteria and the Board's receipt of the retirement application. If the member is less than age 60 upon termination of employment, and all retirement criteria are met, the effective date of retirement will be the first day of the month following receipt of the retirement application.

Retirement benefits are not automatic.
Prospective retirees must make application to the Board in order to commence retirement benefits. Distributions must start by April 1 of the year following the later of: (A) The date a member reaches age 70½, or (B) The date upon which a member terminates employment.

Regular retirement benefits are paid in equal monthly installments in 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 means the average annual salary from the highest 36 consecutive months within the last 15 years of employment. Any lump sum payment that is not guaranteed to be paid annually is not considered compensation and is, therefore, not used in FAS. Annual increment pay received by State employees is considered compensation and is, therefore, used in FAS.

2% x Years of Service x FAS = Annual Straight Life Retirement Benefit

Annuity Options:
Straight Life: A lifetime annuity payable monthly to the retiree determined under the full benefit formula without adjustment. There are no beneficiary benefits payable under this option.
Option A - 100% Joint and Survivor: A reduced annuity payable monthly to the retiree for his or her lifetime. Upon the death of the retiree, the named beneficiary will receive the same amount for his or her lifetime.
Option B - 50% Joint and Survivor: A reduced annuity payable monthly to the retiree for his or her lifetime. Upon the death of the retiree, the named beneficiary will receive one-half of the monthly payment for his or her lifetime.
The named beneficiary 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. Under all options any unpaid employee contributions, plus 4% interest, remaining at the retiree's or beneficiary's death, will be paid to the named secondary beneficiary, if available, or the estate, if no secondary beneficiary. Secondary beneficiaries are not eligible to receive a monthly annuity.

Benefit Payments:
The very first benefit payment due 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 recipient accounts on the 25th of each month, except the month of December, when recipient 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.

Social Security income, private sector income, or private sector retirement benefits do not affect PERS regular retirement benefits. (Some stipulations apply to disability retirees.)

Retirement Benefit Estimate:
Approximately 6 months prior to retirement eligibility, members should contact the Board to request an estimate of potential benefits for all three retirement annuity options. An estimate is required prior to receiving a retirement packet.

Use of Unused Sick and Annual Leave at Retirement:
PERS members who have accrued, unused annual and/or sick leave days may, if eligible, 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. Such days will constitute additional service in the computation of retirement benefits. The additional credited service shall not be used in meeting initial eligibility for retirement criteria.

In the alternative to increasing retirement benefits, members who participate in the Public Employee Insurance Agency (PEIA) may be eligible to apply accrued, unused annual and/or sick leave days at retirement toward the purchase of retiree health insurance under PEIA. Members should contact PEIA to determine eligibility for this option prior to retirement.

Unused leave CANNOT be divided and used for both service credit and PEIA coverage. Members who retire from a city, county, or any other non-direct employer 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), unused leave is not eligible to be deferred and used for service or PEIA at a later date.

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 and incapacitation must have occurred during the time the member was employed by a participating public employer in order to qualify 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.

Disability recipients are required to submit a medical recertification as well a copy of his or her annual statement of earnings for specified periods of time following receipt of disability benefits.

Changing a Beneficiary Prior to Retirement:
If a member wishes to change a beneficiary(ies), he or she must complete a new beneficiary form and return it to the Board. The member should keep a copy of this form for his or her records. If a member's family situation changes (birth, death, divorce, marriage.), 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:
Upon the death of a member who falls under this category, a 100% Joint and Survivor annuity will be paid to the deceased member's surviving spouse, calculated as if the member had retired the day preceding the date of his or her death. Any member who falls under this category may also elect one of the following options:
(A) The member may 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:
Upon the death of a member who falls under this category, a 100% Joint and Survivor annuity will be paid to the deceased member's surviving spouse, calculated as if the member had retired the day preceding the date of his or her death. Any member who falls under this category may also elect one of the following options:
(A) The member may elect to name a beneficiary to receive a refund of his or her employee contributions plus 4% interest in the event 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 regularly 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 PERS participating employer so long as he or she does not receive compensation in excess of $20,000 during any one calendar year.

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. Or the member may 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 contributions are not eligible to be withdrawn. Once the member withdraws contributions from the system, he or she forfeits all future retirement and disability benefits.

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 he or she redeposit the withdrawn funds plus interest. Members must be re-employed for 1 year and the first reinstatement payment must be made between the first and second year of re-employment. If the first reinstatement payment is not made before the end of the member's second year of re-employment, the member will not be eligible to reinstate previously withdrawn service. The full reinstatement amount must be repaid (in a lump sum or payments) before the end of the fifth year of the member's return to employment. Members should contact the Board at the end of his or her first year of return to employment to obtain the cost to reinstate withdrawn PERS service.

Military Service:
Military service may be credited to PERS members in accordance with the WV Code 5-10-15. Members who have a break in employment as a result of being called to active military service may be eligible 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 be in receipt of an annuity from such plan. Purchased out-of-state service may not be used to establish eligibility for a retirement benefit in PERS.

Appointments:
Most retirement related matters can be handled from the convenience of your home via mail and telephone. However, members who wish to visit the Board to discuss retirement related matters with a PERS staff member are required to make an appointment.

Questions:
Should you have any questions regarding PERS, please feel free to contact us in writing, by phone, or e-mail, Monday through Friday, 8:00 a.m. to 5:00 p.m. For additional information, you may also want to visit our website.

Note:
Information contained in this document illustrates the CPRB's understanding of the current provisions of the PERS. These provisions are contained in the current plan statutes, and are subject to modification by the West Virginia Legislature each year. This document is for general guidance purposes only. In the event there is a discrepancy between information contained in this document and the WV State Code and Rules, the language in the Code and Rules shall prevail.

 

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  CPRB © 2014 - State of West Virginia - The materials contained herein are intended for general guidance purposes only. In the event there is a discrepancy between information contained here and the WV State Code and Rules, the language in the Code and Rules shall prevail.
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