PERAC Memo #2 - 2009: 2009 Interest Rate set at 0.5%

2009 Interest Rate set at 0.5%

Summary

This memo announces that PERAC has set the 2009 "regular interest" rate at 0.5%, as required under G.L. c. 32, §22(6)(b), based on average savings account rates from a sample of financial institutions. Boards must apply this 0.5% rate to accumulated total deductions and accrued interest when crediting interest for 2009 refunds and retirements, and again on December 31, 2009 for outstanding balances as of December 31, 2008.

Full Text

MEMORANDUM #2, 2009 M E M O R A N D U M TO: All Retirement Boards FROM: Joseph E. Connarton, Executive Director RE: 2009 Interest Rate set at 0.5% DATE: January 12, 2009 In accordance with the provisions of G.L. c. 32, § 22(6)(b) “regular interest” for regular and additional deductions made after January 1, 1984, shall be a rate established by the Public Employee Retirement Administration Commission in consultation with the Commissioner of Banks, and shall be obtained from the average rates paid on individual savings accounts by a representative sample of no less than 10 financial institutions. The average rate paid has been determined to be 0.5% for the calendar year 2009. The average rate of 0.5% is to be applied on the accumulated total deductions and accrued interest. Such interest shall be credited during the calendar year 2009 for refunds and retirements. Such interest shall also be credited on December 31, 2009 for outstanding balances as of December 31, 2008.