PERAC Memo #62 - 1998: Option (C) Pop-Up Date

Option (C) Pop-Up Date

Summary

This memo clarifies that regardless of when a retirement board formally accepts Section 288 (the Option (C) Pop-Up provision), the resulting pension allowance adjustment for eligible members—those retired before January 12, 1988 under Option (C) whose beneficiary predeceased them—must be effective as of July 1, 1998, including retroactive payment of any increase owed for months between July 1 and the acceptance date. Boards must not adjust benefits for periods before July 1, 1998, nor delay the start of the adjustment period beyond that date. Boards adopting Section 288 must send PERAC a certified copy of the legislative body's vote and the retirement board's minutes documenting acceptance.

Full Text

PERAC MEMO #62/1998 M E M O R A N D U M TO: All Retirement Boards FROM: Robert F. Stalnaker, Executive Director RE: Option (C) Pop-Up Date DATE: December 9, 1998 We have received questions regarding from what date adjustments of pension allowance would occur after a system has properly accepted Section 288 of Chapter 194 of the Acts of 1998 (the so-called Option (C) Pop-Up provision). Regardless of the date the system accepts this provision, benefits are adjusted as of July 1, 1998. Boards may not make adjustments for time periods prior to July 1, 1998 or begin the adjustment period after July 1, 1998. As an example, a member retired on October 1, 1985, and the date of their beneficiary’s death is April 1, 1990. The member’s system accepts Section 288 on November 1, 1998. Starting on November 1, 1998, the member’s allowance would be increased to reflect the “Pop-Up” provision. The board would also owe the amount of the increase for the months of July, August, September and October, 1998. Section 288 would allow for a pension adjustment for those members who retired before January 12, 1988, chose Option (C) and whose beneficiary predeceased them. It is important that boards send a certified copy of the legislative body’s vote and the retirement board’s minutes which show acceptance of this section to PERAC.