PERAC Memo #14 - 2002: Follow-up to PERAC Memo #36/2001
Follow-up to PERAC Memo #36/2001
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This memo clarifies that the G.L. c. 32, §5(2)(b) veteran's benefit is an additional amount to be applied on top of other calculations—added after the $3,000 minimum is applied to a member-survivor benefit, added on top of §90C-increased allowances, and added after (not included in) Option C pop-up calculations, with a worksheet provided for the pop-up scenario. It also revises the position taken in Memo #36/2001, following Dargin v. PERAC, to now permit boards to pay recalculated benefits owed to deceased retirees to their estates or beneficiaries. Boards should apply this methodology going forward and process any owed payments to estates/beneficiaries of deceased retirees accordingly.
Full Text
Memorandum # 14/2002
M E M O R A N D U M TO: All Retirement Boards FROM: Joseph E. Connarton, Executive Director RE: Follow-up to PERAC Memo #36/2001
DATE: March 5, 2002
We have received several inquiries concerning the additional veteran’s benefit provided for in G.L. c. 32, § 5(2)(b). Specifically, the effect of the veteran’s benefit on a member-survivor receiving the $3,000 minimum; the effect of the veteran’s benefit on an allowance that was increased under § 90C; and the effect of the veteran’s benefit on Option C Pop-up calculations.
The veteran’s benefit has been interpreted to be an additional benefit paid above and beyond the
regular benefits provided for in Chapter 32. Thus, all other things being equal, if there are two
members, one who is a veteran, the other who is a non-veteran, the veteran’s allowance should always
be greater than the non-veteran’s allowance by this additional veteran’s benefit. As such, it should be
added in the calculation of a member-survivor benefit after the minimum has been applied, it should be
added on top of any benefits that are increased under §90C and should not be included in the
allowances used in the pop-up calculation, but added in after the allowance has been popped-up.
Attached for your convenience is a worksheet detailing how the pop-up should be performed when
there is the additional veteran’s benefit.
Also, we have received a few inquiries into whether the benefits due to deceased retirees should be paid to the estate or beneficiaries. In PERAC Memo #36/2001, the Commission instructed the boards to recalculate only the allowances for veterans or beneficiaries receiving benefits on the day of that decision. Following the decision in Dargin v. PERAC, the Commission is hereby revising its original position and will allow payments to be made to the estate or beneficiaries of deceased retirees.
We trust the foregoing is of assistance. If you have any questions concerning this calculation, do not hesitate to contact the actuarial unit.