administration

Section 2 describes the structure of the Massachusetts contributory retirement systems established under Chapter 32, confirming their continuation as of December 31, 1945, and specifying which governmental units and employee classes belong to each system. It assigns teachers to the Teachers' Retirement System, state employees to the State Employees' Retirement System, and sets rules for county, city, town, district, and authority employees to be included in the corresponding local or regional retirement system. It also addresses special circumstances for employees of named authorities such as MassDOT, MBTA Police, MassPort, and others, and preserves all existing rights, rules, and regulations consistent with Sections 1–28.

Section 3 governs the conditions of membership in a Massachusetts contributory retirement system, covering both member-in-service and member-inactive status, how membership begins and ends, and special membership scenarios. It establishes the four group classifications (Group 1 through Group 4) that determine retirement age thresholds and benefit formulas, and specifies the criteria for assignment to each group. The section also addresses multiple-system membership, part-time and intermittent employment, leaves of absence, dual compensation situations, and the procedures for reinstatement or transfer of membership between systems.

Section 3A addresses ineligible employees — specifically, persons receiving compensation from the Commonwealth who are not eligible for membership in the state retirement system. Such individuals are directed to the deferred compensation program established under Section 64 of Chapter 29. This brief section ensures that non-eligible Commonwealth employees have access to an alternative retirement savings mechanism in lieu of Chapter 32 membership.

Section 4 defines creditable service under Chapter 32 — the service credit that forms the basis of a member's retirement allowance calculation. It covers how current and prior service is credited, conditions for military service credit, leaves of absence, service with multiple governmental units, purchase of prior service, and service buybacks. The section also includes provisions for credited service during various types of leave, including unpaid leave, FMLA, and military duty, and establishes rules for members who transfer between systems or have gaps in service.

Section 5A permits any city, town, district, or other governmental unit to accept its provisions and establish a wellness program for public safety and other employees referenced in Section 94. It sets minimum program requirements established by the Department of Public Health, requires the Commonwealth and its agencies to establish such programs automatically, and provides for reimbursement of up to half the cost (capped at $100 per employee) to municipalities that accept the section and fund wellness programs. Acceptance by a city, town, or district triggers the health and fitness standards framework in Section 5(3)(e).

Section 5B requires every employer of Chapter 32 members to establish an early intervention plan designed to reduce disability retirements through coordinated employee assistance, workplace safety, and medical and vocational rehabilitation. When a member has been absent from work for 30 or more days due to a work-related injury and return to work is not imminent, the employer must assemble an early intervention team to assess the member's condition and design a rehabilitation plan. Members who fail to participate in an assessment or rehabilitation program without good cause forfeit their rights to ordinary or accidental disability benefits under Sections 6, 7, or 26.

Section 6 governs ordinary (non-work-related) disability retirement under Chapter 32. It allows a member who is permanently unable to perform the essential duties of their job to retire for ordinary disability after 15 years of creditable service (or 10 years for veterans or in systems accepting the 10-year option). Benefit amounts are calculated as though the member retired for superannuation at age 55 (or 60 for post-April 2, 2012 Group 1 members), with no less than the superannuation benefit if the member has already reached that age. The section also establishes the Regional Medical Panel process, which requires a three-physician panel to certify incapacity, and sets a 180-day deadline for final board determinations.

Section 7 governs accidental (work-related) disability retirement under Chapter 32. It applies when a member is permanently unable to perform job duties due to a personal injury or hazard sustained in the performance of their duties. The benefit equals 72% of the member's regular compensation (subject to a 75% total cap), plus an annuity based on accumulated deductions and an additional allowance for dependent children. The section includes strict timelines for filing notice of injury, requires Regional Medical Panel certification, provides for proration when injury occurred in a different governmental unit, and includes provisions for mutual aid situations where members are injured while assisting another jurisdiction.

Section 8 establishes the ongoing evaluation and reexamination process for members retired on disability under Sections 6 or 7. The Public Employee Retirement Administration Commission (PERAC) must conduct evaluations at defined intervals — annually for the first two years, then every three years — to assess whether a disability retiree may be able to return to work or would benefit from rehabilitation. If a retiree is found able to return to their former or similar position, their disability retirement is revoked and they are restored to active membership. The section also governs modification or suspension of a pension allowance based on the retiree's earnings or earning capacity, with appeal rights to the Contributory Retirement Appeals Board.

Section 12D requires all Massachusetts Chapter 32 retirement systems to pay benefits in compliance with the required minimum distribution rules of Section 401(a)(9) of the Internal Revenue Code and its applicable regulations, as they apply to governmental plans under IRC Section 414(d). This provision, enacted in 2009, ensures that inactive members who are not yet receiving a retirement allowance and are no longer employed must begin taking required minimum distributions by the applicable federal deadline (currently April 1 of the year following the year they reach age 73), keeping the systems in federal tax compliance.

Section 13 governs when and how retirement allowances, annuities, and pensions are paid under Chapter 32. It establishes monthly payment schedules, pro rata rules for partial months, and authorizes direct deposit requirements. It also provides that members entitled to very small allowances (under $360/year) receive a lump-sum refund of accumulated deductions in lieu of ongoing payments, with an optional lump-sum available for allowances under $600/year upon written request.

Section 14 addresses the interplay between Chapter 32 retirement rights and workers' compensation benefits under Chapter 152. Members receiving workers' compensation for total incapacity retain member-in-service status and accrue creditable service during that period. It also establishes an offset rule: workers' compensation payments for the same injury that gives rise to a disability pension are credited against the pension, so that a member does not receive full benefits from both sources simultaneously.

Section 14A requires that any recovery of lost wages from a third party (not the employer) for the same injury underlying a disability pension under sections 6, 7, or 9 be offset against the pension. It obligates the retirement board to prosecute third-party claims on behalf of a member or beneficiary who fails to do so, and authorizes suspension of pension payments if the member or beneficiary refuses to cooperate.

Section 15 establishes forfeiture of retirement benefits for members who misappropriate public funds or are convicted of crimes related to their office. Following a board hearing, a member found to have misappropriated funds forfeits retirement allowances and accumulated deductions up to the amount misappropriated. Final criminal convictions—including for bribery, extortion, or general workplace misconduct—can result in total forfeiture of pension rights, with a possible return of accumulated deductions (without interest) depending on the offense. The section also prohibits retirement allowances based on intentionally concealed or misreported compensation.

Section 16 establishes the procedures for involuntary retirement initiated by a department head, including the member's right to a hearing before the retirement board. Members meeting minimum age and service thresholds (generally age 55 with 15 years, or 20 years of service regardless of age) may petition the district court to review adverse board decisions. All other aggrieved members may appeal to the Contributory Retirement Appeal Board, which assigns matters to the Division of Administrative Law Appeals for hearing, with final and binding decisions subject to limited further review.

Section 17 provides a mechanism for exercising a member's retirement options and rights when the member is incompetent or otherwise unable to act on their own behalf. The spouse (if living together), guardian, or conservator may act in priority order; absent all of these, the board may designate any person it finds to be acting in the member's best interests.

Section 18 requires members and employees to file written statements and certified records when requested by the retirement board, and establishes an escalating enforcement mechanism—including suspension without compensation—for unreasonable delays. It imposes criminal penalties for knowingly making false statements or falsifying system records with intent to defraud, and requires actuarial correction of any benefit errors resulting from such wrongful acts.

Section 19 provides broad protections for retirement system funds and member benefits, exempting them from taxation (including state income taxes), bankruptcy proceedings, and attachment by creditors. Assignments of retirement rights are generally prohibited, with narrow exceptions allowing written authorizations to withhold amounts for health insurance premiums, federal and state income taxes, and support orders. The section preserves the right to attach or assign benefits to satisfy court-ordered child support or spousal support obligations under several Massachusetts chapters.

Section 19A authorizes retired members to make written assignments directing their retirement board to withhold monthly amounts for health insurance premiums, federal income tax payments, and child support orders. When a retiree's pension check is insufficient to cover health insurance deductions, the last employing governmental unit is responsible for billing the retiree directly. Retirement boards may also deduct the retiree's share of Chapter 32B health insurance premiums directly from pension checks.

Section 19B requires the state treasurer to automatically withhold Chapter 32B health insurance premiums from the monthly pension of teachers' retirement system members and eligible surviving spouses, unless the member affirmatively opts out. The governmental unit treasurer must annually file a premium schedule with the retirement board by May 1, and the retirement board certifies eligible members to their respective governmental units. Upon death of a member, the retirement board notifies the treasurer to discontinue coverage, except where a surviving spouse remains eligible for continued coverage.

Section 19C subjects retirement allowances, annuities, and accumulated deductions under Chapter 32 to child support liens and income withholding orders administered by the IV-D agency under Chapter 119A. Upon receiving notice from the IV-D agency, a retirement board must comply with any lien or withholding order and continue compliance until officially notified that the obligation is satisfied. Boards that make payments to the IV-D agency are discharged from further liability, and section 24 proceedings constitute the exclusive remedy for any disputes about board compliance with these obligations.

Section 20 is the comprehensive governance provision establishing the structure, composition, and duties of retirement boards for each type of retirement system under Chapter 32, including state employees, teachers, counties, cities and towns, and various special authorities (MBTA police, MassDOT, Massport, MWRA, and others). It specifies board membership, election procedures, compensation, legal counsel, reporting obligations, continuing education requirements, and general administrative powers such as taking evidence, subpoenaing witnesses, and correcting errors in member records. Board members must complete 18 hours of training per term, and failure to do so bars them from serving beyond the conclusion of that term.

Section 20A, available to any city, town, or other entity that accepts it by vote, provides indemnification to retirement board members for legal expenses and damages arising from civil actions related to official duties. Indemnification follows the same standards as those for public employees under Chapter 258, but is explicitly denied where the board member's conduct constituted a breach of fiduciary duty, willful dishonesty, or intentional violation of law.

Section 20B provides indemnification for members, employees, and investment committee members of the state retirement board, teachers' retirement board, and pension reserves investment management board in civil actions arising from official duties. Indemnification for both defense expenses and damages follows the Chapter 258 public employee standard, but is explicitly excluded where the conduct involved a breach of fiduciary duty, willful dishonesty, or intentional violation of law.

Section 20C requires every retirement board member to file annual statements of financial interest with the Public Employee Retirement Administration Commission (PERAC), disclosing business associations, investments, debts, gifts, honoraria, and other financial relationships — particularly any involving persons with a direct interest in matters before the board. Filing is required within 30 days of joining a board, annually by May 1, and by May 1 of the year after leaving the board. Failure to file or correct a deficient statement within 30 days of written notice results in removal from the board, and the removed member is barred from future service on any retirement board under Chapter 32.

Section 21 establishes the Public Employee Retirement Administration Commission (PERAC) as the primary supervisory authority over all Massachusetts public retirement systems, with powers to prescribe accounting methods, conduct field examinations every three years, review and remand disability and termination retirement decisions within 30 days, assess expenses against covered systems, and maintain a comprehensive public employee retirement and disability data system. The section also governs actuarial valuation requirements — conducted biennially under the entry age normal method — experience investigations every six years, and requires PERAC to develop rehabilitation programs for disabled employees in cooperation with other state agencies.

Section 21A authorizes PERAC to maintain a consolidated list of vendors debarred or suspended from contracting with any retirement board under Chapter 32. Debarment may be imposed for criminal convictions related to public contracting, antitrust violations, Chapter 268A ethics violations, or substantial evidence of fraud, performance failures, or undisclosed compensation. Suspensions are temporary, capped at 12 months unless related criminal proceedings are pending, and require advance written notice except in emergencies. Full debarment proceedings require a hearing opportunity and a written decision with findings; affiliates of a debarred or suspended vendor may be included in the exclusion.

Section 22 is the primary financing and fund structure provision for Massachusetts public retirement systems, establishing seven distinct funds within each system: the Annuity Savings Fund (member contributions), Annuity Reserve Fund (retirement annuities), Pension Fund (employer pension payments), Special Fund for Military Service Credit, Expense Fund (administration), Pension Reserve Fund (unfunded liability reserves), and the Commonwealth's Pension Liability Fund. Member contribution rates vary from 5% to 12% of regular compensation depending on entry date and employee group, with employees entering on or after July 1, 1996 contributing 9%. The section also governs the Pension Reserves Investment Trust (PRIT) Fund administered by the PRIM board, under-performing system transfer requirements, employer pickup of employee contributions, and detailed appropriation procedures for all system types.

Section 22A was repealed in 1983 by St. 1983, c. 661, § 16A. No substantive content remains.

Section 22B requires the Governor to recommend an annual appropriation to the PRIT Fund to reduce the unfunded pension liability of participating retirement systems. The recommended amount must be at least 1.3% of total appropriations for state employee salaries in the subsidiary accounts "01" and "02" for that fiscal year.

Section 22C establishes the commonwealth's mandatory funding schedule for transferring amounts to the Commonwealth's Pension Liability Fund to eliminate the state's unfunded pension liability by June 30, 2040. The Commissioner of Administration must file and update a triennial funding schedule reviewed and approved by the House and Senate Ways and Means Committees, with annual increases in the amortization component capped at 7.5%. For fiscal years 2024–2026, specific dollar amounts are fixed by statute: $4,104,583,378; $4,499,854,757; and $4,933,190,770. The section also requires an additional Governor's recommendation for an amount equal to the full normal cost and benefits paid, and authorizes an advanced funding schedule for surplus investment returns.

Section 22D allows local and county retirement systems (other than state and teachers') to voluntarily adopt a formal funding schedule designed to eliminate their unfunded actuarial liability by June 30, 2030. Systems accepting this section may receive annual pension funding grants from the Commonwealth, calculated as a share of revenue growth in state income, corporate, and sales taxes. Acceptance also triggers mandatory adoption of several benefit provisions — including 10-year vesting, supplemental dependent allowances, survivor benefits, and fitness/wellness programs — and requires annual reports to members. Acceptance is irrevocable.

Section 22E requires the PERAC actuary to conduct a review and financial impact analysis of proposed statutory changes to the commonwealth's pension liability — including early retirement incentives, COLA adjustments, membership expansions, or other amendments to Chapter 32 — when requested by any joint standing committee or a ways and means committee. The actuary must report within 90 days of the request, consulting with other relevant state agencies.

Section 22F allows local and county retirement systems to revise their existing Section 22D funding schedules based on an actuarial valuation conducted as of January 1, 2009 or later, extending the unfunded liability amortization period to no later than June 30, 2040. Annual amortization increases under a revised schedule may not exceed 4%, no year's payment may be less than the prior year's payment until fully funded, and if a year's payment would exceed the prior year by more than 8%, PERAC approval is required. Systems may also use a revised schedule to increase the COLA base amount in $1,000 increments.

Section 23 governs investment and custodial management of retirement system funds. It establishes the Pension Reserves Investment Management (PRIM) Board as a nine-member unpaid board chaired by the State Treasurer, with full fiduciary authority over the PRIT Fund. The section codifies the prudent investor standard for all fiduciaries, bars investments in tobacco companies deriving more than 15% of revenues from tobacco sales, requires investment managers and consultants to be selected through PERAC-acknowledged processes, addresses investment restrictions tied to South Africa and Northern Ireland, and sets minority investment manager goals of not less than 20%. Local system funds are held by the respective governmental treasurer-custodian and must be invested through an investment manager.

Section 23A was repealed in 1996 by St. 1996, c. 315, § 13. No substantive content remains.

Section 23B establishes a mandatory competitive sealed proposals process that every retirement board must follow when procuring investment, actuarial, legal, and accounting services. Key requirements include public notice posted for at least two weeks, written evaluation criteria, confidentiality of proposals until evaluations are complete, and mandatory contractual fiduciary and disclosure terms for investment service providers. Investment service contracts may not exceed seven years (including renewals). Board members must certify under penalty of perjury that procurements are free from collusion, and persons who cause contracts to be awarded in violation of the section forfeit up to $2,000 per violation plus double damages.

Section 24 provides PERAC with the primary enforcement mechanism for violations of Chapter 32. When PERAC determines that any governmental unit, officer, employee, or retirement board has violated or neglected Chapter 32 requirements, it must notify the appropriate executive authority and, if violations continue, refer the matter to the Attorney General. The Superior Court has equity jurisdiction to compel compliance and restrain violations. Willful refusal or neglect to comply with Chapter 32 or its regulations is punishable by a fine of up to $1,000 or up to one year imprisonment, or both.

Section 25 provides several fundamental protections for retirement system members. It guarantees minimum retirement allowances for members who had rights under pre-1946 law, ensures that members with rights under prior non-contributory pension laws receive at least those amounts, and preserves the rights of veterans who entered government service before July 1, 1939 to choose between Chapter 32 and veterans' pension benefits at retirement. The section declares that retirement system membership constitutes a contractual relationship that cannot be diminished by subsequent legislative amendments for members who have paid required contributions. It also expressly authorizes mandamus actions — by PERAC, the Attorney General, or district attorneys — to compel governmental units that fail to appropriate or pay required pension obligations.

Section 27 is a transitional provision governing the disposition of retirement system fund balances as of January 1, 1946, when the current Chapter 32 structure took effect. It directs how assets from prior annuity savings funds, annuity reserve funds, pension funds, military service credit funds, and expense funds were to be transferred and credited into the corresponding new funds established under Section 22. Any surplus in the annuity savings fund was transferred to the annuity reserve fund, and any deficiency in the annuity reserve fund was addressed through transfers from the pension fund.

Section 28 governs how various governmental units formally opt into Chapter 32. Towns may accept the chapter by voter referendum at a state election; cities or towns with existing special-act retirement systems may accept by city council/mayoral vote or selectmen's vote. Districts, housing authorities, and special authorities (MassDOT, MBTA police, Massachusetts Housing Finance Agency) each have their own acceptance procedures. When a small town with fewer than 10,000 residents accepts, its employees join the county system rather than creating a new town system. The section also addresses transitional membership rights when new systems are established, including prior service credit and transfers of fund shares from old systems to new ones.

Section 28B was repealed in 1991 by St. 1991, c. 412, § 35. No current operative text exists.

Section 28C was repealed in 1948 by St. 1948, c. 589, § 1. No current operative text exists.

Section 28D was repealed in 1952 by St. 1952, c. 634, § 1. No current operative text exists.

Section 28E was repealed in 1952 by St. 1952, c. 634, § 2. No current operative text exists.

Section 28F was repealed in 1987 by St. 1987, c. 697, § 98. No current operative text exists.

Section 28G was repealed in 1950 by St. 1950, c. 813, § 2. No current operative text exists.

Section 28H was repealed in 1952 by St. 1952, c. 634, § 3. No current operative text exists.

Section 28I provides that a Commonwealth employee who is a retirement system member and is selected to serve with an interstate commission that Massachusetts participates in and funds shall continue as a retirement system member while on that assignment. The employee must continue making monthly contributions as if still on the state payroll, and retains all retirement system benefits and privileges during the interstate commission service.

Section 28J was repealed in 1952 by St. 1952, c. 634, § 4. No current operative text exists.

Section 28K governs retirement system membership for Commonwealth or political subdivision employees who take a leave of absence (full-time or part-time) to serve as a representative of an employee organization. Such employees are treated as on unpaid leave, but continue to accrue creditable service as if in active service and must continue making monthly retirement contributions at the rate they would have paid if still working. The employee retains all retirement benefits and privileges except salary during the leave. The provision for crediting service back to January 1, 1975 requires majority board vote and acceptance by the appropriate legislative body, with a certificate of acceptance filed with PERAC.

Section 28L was repealed in 1991 by St. 1991, c. 412, § 35A. No current operative text exists.

Sections 29 through 32 were repealed in 1945 by St. 1945, c. 658, § 1. No current operative text exists for these sections.

Section 33 was repealed in 1936 by St. 1936, c. 400, § 4. No current operative text exists.

Sections 34 through 38A were repealed in 1945 by St. 1945, c. 658, § 1. No current operative text exists for these sections.

Section 39 authorizes private employers and their employees to form voluntary associations for the purpose of providing annuities, pensions, or endowments upon retirement on account of age. Both employees (contributing a percentage of wages) and employers contribute to association funds held by independent trustees. The funds may be used for retirement benefits, death benefits for pre-retirement deaths, withdrawal refunds, and administrative expenses. Such associations are exempt from insurance company regulations, and may cover employees of affiliated corporations in the same or related fields under common management.

Section 40 sets governance requirements for private pension associations formed under Section 39. By-laws must be approved by PERAC and must specify how the association is conducted and how funds are invested and disbursed. An association is formally established when its by-laws are approved by both the employer and a two-thirds vote of employees and by PERAC. The association must file an annual report with PERAC by March 1 covering membership and financial transactions from the prior year. PERAC may audit the association's books, and failure to comply with reporting requirements is punishable by a fine of up to $500.

Section 41 protects the assets of private pension associations formed under Section 39 from taxation, bankruptcy proceedings, and creditor attachment. Employee rights in association funds and any annuity, pension, or endowment payable under Sections 39 or 40 cannot be assigned. However, an exception allows the attachment or assignment of a pension or annuity to satisfy a child support order under Chapters 208, 209, or 273.

Section 42 addresses legacy teacher pension funds in cities and towns (excluding Boston) that accepted Chapter 498 of the Acts of 1908. In those jurisdictions, the pension fund for retiring public school teachers is funded by revenues assigned by the city council or by direct town appropriation. The city or town treasurer holds the fund and makes monthly payments to retirees in amounts certified by the school committee.

Section 43 provides a legacy non-contributory retirement mechanism for teachers in cities and towns that accepted the 1908 pension act (Section 42). The city or town retirement board, on recommendation of the school committee, may retire a teacher who is age 60 or older, or who is incapacitated for useful service, after 25 years of faithful service. The annual pension is capped at one-half of final compensation and in no case may exceed $1,200.

Section 44 authorizes the retirement of public school janitors in cities and towns that have accepted this section. Retirement is available to janitors who are age 60 with 25 years of service and are physically incapacitated, or who have 15 years of service and are physically incapacitated due to a job-related injury. The pension equals one-half of the last year's full-employment compensation, capped at $750 per year, paid from school appropriations. Critically, this section applies only to janitors whose employment began before July 1, 1937; those hired after that date are not eligible.

Section 44A allows cities and towns (by a two-thirds city council vote or annual town meeting vote) to retire school janitors not covered by the contributory retirement system at their own request. Eligibility requires the janitor's employment to have begun before July 1, 1937, and one of three conditions: 35 years of service; age 60 with 25 years of service and incapacitation; or 15 years of service with duty-related incapacitation. The pension equals 72% of the annual compensation at the time of retirement, paid from school appropriations.

Section 44C allows cities and towns (by supermajority city council vote or annual town meeting vote) to retire public school dental assistants at their own request. Eligibility requires employment beginning before July 1, 1937, and one of: 35 years of service; age 60 with 25 years of service and incapacitation; or 15 years of service with duty-related incapacitation. The pension equals 72% of annual compensation at retirement, paid from school or dental assistant appropriations.

Section 45 provides that Section 44 (school janitor retirement) does not apply to the City of Boston, but applies to other cities upon acceptance by the mayor and city council, and to towns upon acceptance at a town meeting, provided that acceptance occurred before January 1, 1946.

Section 45A provides an enhanced pension formula for school janitors retired under Section 44 in cities and towns that separately accept this section. Rather than the basic one-half of last year's compensation capped at $750 under Section 44, the pension under Section 45A equals one-half of the highest salary received by the janitor while holding the grade held at retirement.

Section 45B protects school janitors and custodians employed before July 1, 1937 in cities and towns that have accepted Sections 44 and 45A. If such an employee is later promoted to a supervisory position in the janitorial or custodial service, the promotion does not forfeit their right to a non-contributory pension under Sections 44 and 45A. This section requires separate acceptance by the city or town.

Section 45C provides an enhanced longevity formula for school janitor pensions in cities and towns that have accepted Sections 44 and 45A and also accept this section. For janitors with 20 years of service, the base pension equals one-half of the highest annual compensation in their grade at retirement. For each year of service beyond 20, the pension increases by an additional 1% of that compensation, subject to an overall cap of 65% of highest annual compensation. Acceptance requires a two-thirds city council vote (Plan D/E cities), regular city council vote (other cities), or annual town meeting majority.

Section 47 governs the calculation of service credit for retirement eligibility under Section 46. Correctional officers, instructors, and employees may combine service from multiple qualifying institutions — including correctional institutions, the prison camp and hospital, and juvenile training schools — for purposes of meeting the service thresholds. Service credit is forfeited only for dismissals for misconduct that were not later reversed; a restoration to duty or reappointment serves as sufficient evidence of exoneration.

Section 48 sets the pension amount for correctional officers, instructors, and employees retired under Section 46 at one-half of the salary at retirement. For employees receiving non-cash compensation (full or partial boarding or housing), the Commissioner of Correction may add up to $7 per week in the case of full boarding and housing, or a fair proportion of that amount in the case of partial housing and boarding, to the cash salary for purposes of computing the pension base. State correctional institution pensions are paid by the Commonwealth; jail and house of correction officer pensions are paid by the county.

Sections 49 through 51 were repealed in 1954 by St. 1954, c. 627, § 9. No current operative text exists for these sections.

Section 54 specifies that sections 52 and 53 (veterans of Indian wars retirement provisions) become effective in any city by city council vote or in any town by town meeting vote accepting them or corresponding prior law provisions.

Section 55 provides that city council actions regarding acceptance of sections 52 and 53, or the retirement of any veteran under them, are subject to the mayor's veto and override as provided in the city charter.

Section 57A applies certain provisions of the contributory retirement system (regarding reexamination, reemployment, and reinstatement) to veterans retiring under sections 56 or 57 on or after January 1, 1946, with the retiring authority acting in place of the retirement board.

Section 59 defines "retiring authority" as used in sections 56–60 for veterans: the state board of retirement for the commonwealth, the appropriate retirement board for counties, cities, towns, districts, and regional school districts, and the selectmen, prudential committee, or relevant authority for towns and districts without a retirement board.

Section 59A requires that when a veteran's pension is based partly on service in a different governmental unit than the one paying the pension, the paying unit must be reimbursed annually by the other unit for the proportionate share of the pension, with enforcement through contract action if payment is not made.

Section 60 makes sections 56–59 effective in any county, city, town, or district that accepted them before January 1, 1946, and bars veterans whose employment first began after June 30, 1939 from coverage, while also requiring eligible veterans to have creditable service at least equal to twice their time not in public employ since their service began.

Section 60A was repealed in 1954 by chapter 627, section 15.

Sections 61 through 65 were repealed in 1937 by chapter 409, section 2.

Section 65D1/2 allows a member inactive in a retirement system who is appointed by the governor to a judicial position to elect, within 30 days, to become an active member of that system, provided they repay any retirement allowance received since their original retirement.

Section 65E allows retired SJC justices to be placed on a retired list and remain eligible for temporary judicial service in two-year renewable terms, while retaining their full pension benefits, but prohibits them from practicing law or holding incompatible office during such eligibility.

Section 65F mirrors section 65E for Appeals Court justices: retired Appeals Court justices may be placed on a retired list, remain eligible for temporary judicial service in renewable two-year terms, retain full pension benefits, and are prohibited from practicing law or holding incompatible office while eligible.

Section 65G establishes the same retired-list and temporary service framework as sections 65E and 65F for Trial Court justices, allowing them to perform judicial duties in two-year renewable terms while retaining full pension benefits and being prohibited from practicing law.

Section 67 provides that pensions granted under section 66 and related expenses shall be paid by the commonwealth and the counties in the same proportion as the pensioner's salary was paid at the time of retirement.

Section 68 was repealed in 1991 by chapter 412, section 35B.

Sections 68A through 68C were repealed in 1945 by chapter 658, section 1.

Section 69 was repealed in 1991 by chapter 412, section 35B.

Section 70 was repealed in 1939 by chapter 441, section 4.

Section 72 directs that pensions and annuities under sections 69–71 be paid from the Metropolitan Parks Maintenance Fund via specific (not general) appropriations, while pensions for officers assigned to state police duty are paid from ordinary state revenues.

Section 73 was repealed in 1931 by chapter 426, section 148.

Section 76 sets the pension for probation officers retired under section 75 at half their compensation at retirement, paid by the county where they served (or apportioned among counties by the superior court if they served in more than one), with an additional requirement of 15 years of full-time devoted service for those retired at age 70.

Section 76A updates probation officer pension amounts: half of regular annual compensation at retirement, with an additional 1% per year beyond 20 years of service for those retiring after age 65 with 20+ consecutive years, capped at 65% of compensation, paid by the county where they served or apportioned among counties.

Section 79 provides that pensions payable by cities or towns to former employees of a fire or water district that accepted the 1914 act shall be transferred to and paid by the district.

Section 85F requires that no police officer or firefighter may be retired for disability under sections 80–85F or 85H without first being examined by a three-physician medical panel, with a majority certifying permanent incapacity and (for accidental disability) that it could result from the claimed accident or hazard.

Section 86 was repealed in 1950 by chapter 395.

Section 87 was repealed in 1930 by chapter 182, section 5.

Section 87A was repealed in 1928 by chapter 402, section 4.

Section 90B allows any retiree or their beneficiary to voluntarily waive all or part of a pension or retirement allowance for a specified period (or until further notice), binding themselves and their heirs.

Section 90E provides that if a retiree's classification has been abolished since their retirement, cities, towns, districts, or the Massachusetts Port Authority accepting sections 90A, 90C, or 90D may increase that retiree's allowance to match increases given to retirees who were in the same grade at the time of retirement.

Sections 90F through 90G1/2 were repealed in 2000 by chapter 123, section 25.

Section 90G3/4 was repealed in 2017 by chapter 47, section 28.

Sections 90H and 90I were repealed in 2000 by chapter 123, section 28.

Section 90J allows retirement systems that accept this section (by board majority vote with legislative body approval) to pay from the expense fund the annual physical and mental examination costs for members serving beyond age 70.

Section 91 generally prohibits retirees receiving pensions from also being paid for public service, with specific exceptions (jury duty, elected office, emergency service, medical panels, etc.); paragraph (b) allows retirees to work up to 1,200 hours/year as long as combined earnings and pension don't exceed the salary for the retired position — or the salary the allowance is based on, whichever is greater — plus **$25,000**. The $25,000 figure was raised from $15,000 by Chapter 137 of the Acts of 2026, effective July 9, 2026 and applying to all of calendar year 2026; the statutory text published at malegislature.gov still shows the former $15,000. See [PERAC Memo #21 of 2026](/memos/2026/21).

Section 91A requires disability retirees to file annual earnings statements with PERAC under perjury penalties; if combined earnings and retirement allowance exceed what would be payable had the member remained in service plus **$25,000**, the excess must be refunded, and failure to file can result in termination of the retirement allowance until compliance. The $25,000 figure was raised from $15,000 by Chapter 137 of the Acts of 2026, effective July 9, 2026 and applying to all of calendar year 2026; the statutory text published at malegislature.gov still shows the former $15,000. See [PERAC Memo #21 of 2026](/memos/2026/21).

Section 91B establishes a wage reporting system through which PERAC annually shares retiree data with the Department of Revenue, which then cross-checks earnings reports filed under section 91A to identify non-compliant disability retirees, with findings reported back to the relevant retirement board for action.

Section 91C grants PERAC access to criminal record offender information and requires it to compare that data against the list of disability retirees at least annually; if the comparison suggests action should be taken under sections 6 or 7, PERAC must notify the appropriate retirement board.

Section 92A (which contains section 93 text) provides that persons who were employed by agencies abolished by the 1919 reorganization act and transferred to new departments retain all pension rights as if their service had been continuous.

Section 93 protects the pension rights of employees who were transferred from abolished agencies to new departments under the 1919 reorganization act, treating their service as continuous for all pension purposes.

Section 95 allows cities and towns to grant annuities to officials or employees who have at least 15 years of full-time service but are not entitled to any other pension or retirement allowance, providing up to half their regular annual compensation or $2,000 (whichever is less), with a minimum of $1,200 if the grant would otherwise be less.

Section 97 specifies the required approval processes for granting or increasing annuities and retirement allowances under sections 95 and 96: a two-thirds vote of city council plus mayoral approval in cities, a two-thirds vote at annual town meeting in towns upon selectmen's recommendation, and majority prudential committee or county commissioner vote in districts and counties.

Section 98 authorizes the state treasurer to make advance retirement allowance payments (not to exceed the amount actually due) to eligible state employees who have applied for retirement, while the application is being processed, subject to rules and regulations established by the treasurer.

Section 99 extends to cities, towns, and counties (upon local acceptance) the authority to make advance retirement allowance payments to eligible employees who have applied for retirement while applications are being processed, with rules established by the local treasurer.

Section 102 establishes the cost-of-living adjustment (COLA) mechanism for the state employees' and teachers' retirement systems: the actuary files an annual report, the legislature determines COLA percentages, increases are applied to up to $13,000 of each member's allowance and funded from investment income, and the adjusted amount becomes the new base for future COLAs.

Section 104 establishes two supplemental funds to pay benefits that federal tax law limits would otherwise prevent: (a) a Section 401(a)(17) Excess Fund to pay the difference between the retirement allowance that would have been paid absent the federal compensation cap and what is actually payable; and (b) a Section 415 Excess Benefit Fund to pay the difference between what would be paid without federal benefit limits and what is actually payable under those limits.

PERAC has set the regular interest rate for 2026 at 0.1% per G.L. c. 32, § 22(6)(b), based on the average rates paid on individual savings accounts at a representative sample of at least 10 financial institutions. This rate applies to accumulated total deductions and accrued interest for refunds and retirements processed during calendar year 2026, and will also be credited on December 31, 2026 for outstanding balances as of December 31, 2025.

This memo addresses a specific anti-spiking calculation scenario for union members subject to both G.L. c. 32, § 106 (vacation buyback) and collectively bargained salary schedules. Collectively bargained increases are exempt from the anti-spiking rules under § 5(2)(f), but vacation buybacks are not. PERAC provides a step-by-step worked example showing how to separate these components: first calculate allowable regular compensation excluding collectively bargained increases, then add them back. Any previously retired member whose pay spiked due to a vacation buyback should have their compensation reviewed under this guidance. PERAC is offering virtual sessions on request.

PERAC has announced the 2026 COLA rate of 2.8%, based on the Social Security Administration's CPI-W increase for the prior year. Pursuant to G.L. c. 32, § 103(c), retirement boards may vote to grant a COLA effective July 1, 2026. Under § 103(i), a board may vote to increase the COLA up to 3.0% with proper notice to the legislative body, but this must occur before June 30, 2026. Every board must notify PERAC through PROSPER within 30 days of their decision, whether or not they grant a COLA.

At its December 17, 2025 meeting, the Commission voted to continue the existing practice of allowing PERAC staff to approve non-invasive medical test reimbursements up to $100.00 per disability case, per 840 CMR 10:10(3) and 10:15(1)(c). Any tests ordered by a Regional Medical Panel that exceed this amount still require advance Commission approval before being ordered. This annual notice confirms no change to the $100 threshold for 2026.

Members born on or after January 1, 1951 who are not yet receiving a retirement allowance and are not actively employed by a sponsoring governmental unit must begin taking required minimum distributions (RMDs) by April 1 of the year after they turn 73, per the SECURE 2.0 Act. Boards should promptly send notices to members who turned 73 in calendar year 2025, as their initial distribution deadline is April 1, 2026. A sample notice letter is attached. Boards should urge members to contact the board for counseling given the complexity of rollover rules.

PERAC is alerting boards to a fraud attempt where a bad actor used stolen personal information (name, date of birth, last four of SSN) to create a self-service portal account for a retiree and then requested a direct deposit change. The attempt was thwarted when the board independently contacted the retiree to confirm the request, which the retiree denied. Boards should review their security procedures, including: requiring matching email/phone on file to create portal accounts, fully hiding bank account numbers on deposit notices, reviewing IT quarantine procedures, and periodically auditing new portal account creation.

PERAC has distributed updated 2026 buyback/make-up repayment worksheets and cumulative interest factor sheets. The worksheets apply to buybacks under numerous specific sections of G.L. c. 32, with separate worksheets for buyback interest and actuarial interest. Sections 4(1)(g½), 4(1)(l), 4(1)(l½), 4(1)(l¾), 4(1)(n), 4(1)(n½), 4(1)(p), 4(1)(r), 4(1)(s), and 4(2)(c) use buyback interest exclusively; sections 3(3), 3(4), 3(4A), 3(5), 3(6)(d), and 3(8)(b) may use either rate as described in Memo #23/2012. These worksheets are not applicable to § 3(6)(c) buybacks.

PERAC is requesting boards submit actuarial data for active members, retirees/survivors, and disability retirees as of December 31, 2025, by March 31, 2026 via the PROSPER portal in standard PERAC record format. Boards scheduled for a 2026 actuarial valuation by PERAC should already have received a separate request. After submission, boards will receive data analysis reports through PROSPER identifying errors and questionable items requiring review or correction.

Pre-employment physicals are a required prerequisite to granting accidental disability retirement under any of the three statutory presumptions (G.L. c. 32, §§ 94, 94A, 94B). While HIPAA prevents boards from requiring employers to submit these records at the time of hire, PERAC strongly encourages boards to provide an optional HIPAA waiver to all new and current members that would allow the board to obtain a copy for future use. This waiver should be developed with board counsel and can be distributed as part of onboarding materials. If no physical can be found, members should be encouraged to supply any physicals taken after entering service.

PERAC's Q2 2026 training memo lists educational opportunities from April through June 2026 for retirement board members, including PERAC webinars on Recent Cases of Interest (April 30) and History of Call Fire and PIPOs (May 12), the NCPERS Annual Conference in Las Vegas (May 17–20), and the MACRS Spring Conference in Springfield, MA (May 31–June 3) offering up to 9 credits. Board members must register via PROSPER and submit Training Affidavits for non-PERAC sessions. Note: the MACRS Spring Conference location has changed to Springfield this year.

PERAC has filed proposed amendments to 840 CMR 6.00 (Standard Rules for Disclosure of Information) to align the regulations with the Public Records Law and Fair Information Practices Act. Key changes include: deleting 840 CMR 6.05 (Notice to PERAC); amending 840 CMR 6.08 to require written member consent before a retirement file may be provided to that member's employer; and renaming 840 CMR 6.13 to direct boards seeking public records guidance to contact the Public Records Division directly rather than requesting a formal advisory opinion. A remote hearing is scheduled for May 21, 2026 at 10 a.m.; written comments accepted through May 22, 2026 at 5 p.m.

This memo details boards' responsibilities for administering §91A disability retiree earnings compliance via PROSPER, covering non-filers, salary verification tasks, and excess earnings determinations. Boards must: provide hearing notice/opportunity to non-compliant retirees before any termination action; enter 2025 annual pension, annuity, current salary, and offset figures into PROSPER Salary Verification tasks (via individual entry or CSV upload) and submit for calculation; and, for retirees found to have excess earnings, send required notice, respond to the related PROSPER task documenting action taken, and upload board correspondence (not tax documents). Any data entry errors should be reported to Sandra King for correction.

PERAC Memo #17/2026 announces two PROSPER login security enhancements rolling out this summer: a longer required password (minimum 15 characters, changed only annually) and multi-factor authentication (MFA) requiring a phone-delivered code, with re-entry needed only every 60 days on trusted devices/browsers. Board members and staff will be prompted to update their password upon next expiration and to register a phone number for MFA on a staggered basis, with no action needed until prompted; questions should be directed to IT Director Dan Boyle.

**PERAC Memo #18/2026 – Tobacco Company List (July 2026)** This memo transmits the updated Tobacco Company List, effective upon receipt, which supersedes all prior lists and identifies companies deriving more than 15% of revenue from tobacco products—investments in which are prohibited under Chapter 119 of the Acts of 1997 (applicable to both individual securities and pooled funds assessed at the pool level). Boards must forward the list (or notice of its availability on PERAC's website) to their investment advisors, clarify it is for Massachusetts public fund use only, and ensure portfolios remain compliant; any non-compliant holdings must be divested prudently and only after consulting with PERAC.

This memo (Q3 2026) lists PERAC's mandatory training opportunities for retirement board members, reiterating the Chapter 32 requirement that members earn at least 3 credits per year and 18 credits over their term to remain eligible to serve. Boards should ensure members register for live PERAC webinars/events using their correct name and email for automatic credit updates, and submit Training Affidavits (with certificates where applicable) in PROSPER for all other approved trainings, including the various July–October 2026 sessions listed (e.g., Retirement Board Best Practices, Fraud Awareness, Open Meeting Law, Administrator Training, and the Emerging Issues Forum).

PERAC Memo #20/2026 announces the updated Application for Reinstatement to Service form under G.L. c. 32 §105, effective July 1, 2026–June 30, 2027, which allows retirees to return to member-in-service status. Boards must use this revised form, complete the initial section for interested members, and thoroughly counsel them on the requirements (five years of full-time employment, potential large repayment obligations) before members sign and are reinstated. Boards should contact PERAC's actuarial unit if their investment return assumption isn't among the factors listed on the form.

This memo announces that the FY2027 state budget (signed July 9, 2026) increased the earnings add-on used to calculate permissible post-retirement earnings under G.L. c. 32, §§ 91 and 91A, from $15,000 to $25,000, effective retroactively for all of calendar year 2026. Boards should apply the new $25,000 add-on when calculating allowable post-retirement earnings for both regular retirees (§91) and disability retirees (§91A), while continuing to apply the existing rule that a retiree must be retired a full calendar year before the higher limit applies. No other action is required, but boards should update any earnings-limit calculations/notices already issued for 2026 to reflect the revised figure.

PERAC Memo #22/2026 notifies boards that, following the FY27 budget's 3% COLA (effective July 1, 2026), the supplemental dependent allowance under G.L. c. 32 §§ 7(2)(a)(iii) and 9(2)(d)(ii) increases to $1,193.88 annually per eligible child. Boards that have accepted § 7(2)(a)(iii), § 22D, or § 9(2)(d)(ii) must implement this new annual amount for eligible dependent children beginning July 1, 2026. No further action is required beyond updating payment amounts accordingly; questions should be directed to PERAC actuary John Boorack.

This memo sets the 2025 'regular interest' rate at 0.1% for regular and additional deductions made after January 1, 1984, as required by G.L. c. 32, § 22(6)(b). The rate is derived from the average rates paid on individual savings accounts at a representative sample of at least 10 financial institutions. Boards must apply this rate to accumulated total deductions for refunds, retirements, and year-end crediting on December 31, 2025.

The Social Security Fairness Act, signed January 5, 2025, repeals the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) with a retroactive effective date of January 1, 2024, directly affecting thousands of Massachusetts public employees who receive Chapter 32 benefits. Boards should direct member inquiries to the Social Security Administration and communicate the change broadly. PERAC advises boards to pause on requiring completion of Form SSA-1945 until the SSA releases further guidance on implementing the repeal.

This memo clarifies that the required minimum distribution (RMD) age remains 73 for 2025 notifications, consistent with the SECURE 2.0 Act's rules for members born on or after January 1, 1951. Members who turned 73 during calendar year 2024 must take their first distribution by April 1, 2025, so boards should send notices promptly. A sample notification letter is attached for boards to use.

This memo provides the 2025 IRS compensation and benefit limits applicable to Massachusetts retirement systems under Chapter 46 of the Acts of 2002. The general IRC Section 401(a)(17) compensation limit for 2025 is $350,000, and the IRC Section 415 benefit limit for a member retiring at age 65 is $280,000 per year (reduced for retirement before age 62). These limits are indexed annually and generally affect only the highest-paid employees.

This memo establishes the 2025 cap on 'regular compensation' for members who joined a retirement system after January 1, 2011. Under Section 23 of Chapter 131 of the Acts of 2010, regular compensation for post-2011 members may not exceed 64% of the federal 401(a)(17) limit, which for 2025 results in a $224,000 cap. Boards must apply this limit when calculating contributions and retirement benefits for affected members.

PERAC notifies boards that the Social Security Administration's 2025 COLA, based on the CPI-W, is 2.5%, which sets the maximum COLA that retirement systems may grant under G.L. c. 32, § 103(c) effective July 1, 2025. Boards may vote to increase this rate up to 3.0% pursuant to § 103(i), with proper notice to the legislative body, but must complete this process before June 30, 2025. Each board must notify PERAC of its COLA decision within 30 days.

PERAC introduces a new dedicated PROSPER panel for retirement boards to electronically upload investment manager statements, starting with January 2025 cash books. This replaces the prior practice of submitting statements through various ad-hoc methods, centralizing documentation and streamlining cash book reporting. Boards only need to submit statements for non-PRIM investments; PERAC receives PRIM statements directly. Staff with the Finance role in PROSPER will have automatic access, and a user manual is attached.

PERAC requests that all boards submit actuarial data as of December 31, 2024 — covering active members, retirees/survivors, and disability retirees — via the PROSPER portal by March 31, 2025, using the standard PERAC record format. After submission, boards will receive data analysis reports through PROSPER identifying errors, warnings, and questionable items for review and correction. Boards scheduled for a 2025 PERAC actuarial valuation should have already received a separate data request.

PERAC distributes an updated April 2025 Tobacco Company List under Chapter 119 of the Acts of 1997, which prohibits retirement systems from making new investments in companies deriving more than 15% of revenue from tobacco sales. This list supersedes all prior versions and is effective upon receipt; boards must forward it to their investment advisors. PERAC will assess portfolios for compliance during audits, and any non-compliant investments must be divested in a prudent manner after consulting PERAC.

Following the repeal of the WEP and GPO (Memo #2/2025), the Social Security Administration has released an updated Form SSA-1945 effective March 2025, reflecting the elimination of those provisions. Boards should resume requiring this form for all new employees and should collect signed forms from members who did not file during the prior pause period. The updated form is available at ssa.gov/forms/ssa-1945.pdf and procedural requirements remain the same as before the pause.

PERAC alerts boards to a recent attempted fraudulent capital call scam targeting a retirement board, in which an email impersonated an investment consultant employee to solicit a fund transfer; the attempt was caught due to staff vigilance. Additionally, an investment manager reported two fraudulent capital call attempts impersonating one of its own employees. Boards should verify all financial requests and correspondent identities, review Memo 30/2021 best practices, and report any cyber intrusion or attempted fraud to PERAC.

The Massachusetts Legislature extended the Open Meeting Law waivers to June 30, 2027, through Chapter 2 of the Acts of 2025. Retirement boards may continue to hold public meetings without a physical quorum or a physically present chair, provided the same remote participation and public access conditions in place since March 2020 are met. If a meeting is held in a physically accessible public location without alternative access, a physical quorum is required.

This memo provides the training schedule, options, and requirements for retirement board members to fulfill the Chapter 32 mandatory training obligation for the second quarter of 2025 (18 total credits per term, minimum 3 per year). The memo lists scheduled live webinars, pre-approved online training resources, the June 2025 MACRS conference (Hyannis), the Conflict of Interest training, and guidance on submitting Training Affidavits in PROSPER. No board action is required beyond ensuring members register for and complete qualifying training.

PERAC updates the forms for disability retirement applications to implement Chapter 149 of the Acts of 2024, which created an enhanced accidental disability benefit for firefighters, EMTs, licensed health care professionals, and certain police officers who suffer catastrophic, life-threatening, or life-altering bodily injuries as a direct result of an intentional violent attack with a dangerous weapon. Updated forms include the Member's Application for Disability Retirement, Physician's Statement, Employer's Statement, and a new Regional Medical Panel Certificate specifically for Violent Act Injury applications. Boards must discontinue use of prior versions of these forms immediately.

PERAC distributes an updated July 2025 Tobacco Company List, replacing the April 2025 version. The same statutory prohibition under Chapter 119 of the Acts of 1997 applies: retirement systems may not make new investments in companies deriving more than 15% of revenue from tobacco. Boards must forward the updated list to their investment advisors and confirm it supersedes any prior version they may be using.

PERAC clarifies that its Calculation Unit reviews benefit calculations only for reasonableness — not as a full audit — and will update its approval letters to make this distinction explicit. Boards should not rely on a benefit calculation approval as a guarantee against future audit findings. The Calculation Unit will selectively undertake deeper reviews of complex calculations and can accept flagged cases on a limited basis; boards may contact the Director of Audits or PERAC's actuary with questions.

PERAC reports that a retirement board suffered a ransomware attack by an unauthorized third party who encrypted network files; fortunately, no funds were lost and no data was misused. The board's preparedness — including offsite backups, a disaster recovery plan, cyber insurance, and immediate engagement of legal counsel, law enforcement, IT providers, and PERAC — enabled a swift and organized response. PERAC urges all boards to ensure data backups, review business continuity plans, assess cyber insurance coverage, and maintain accessible emergency contact information.

PERAC releases updated Member Refund and Beneficiary Refund forms, along with a revised IRS Special Tax Notice, reflecting recent federal tax changes under the SECURE and SECURE 2.0 Acts, particularly regarding pre-tax and post-tax contribution treatment for rollovers and direct payments. All boards must use these updated forms in place of prior versions, available on the PERAC website. The IRS Special Tax Notice must be individually provided to each member or beneficiary applying for a refund; electronic delivery is permitted if Treasury Regulation requirements are satisfied.

This memo provides the training schedule and resources for the third quarter of 2025 to help board members meet the Chapter 32 mandatory training requirements. Highlights include the September 17, 2025 Emerging Issues Forum in Westborough, New Administrator Training on August 20, 2025 in Northampton, and a range of webinars from PERAC, AGO, OIG Academy, NCTR, and other organizations. Board members should register through PROSPER and submit Training Affidavits for pre-recorded or externally provided training.

Section 26 of Chapter 9 of the Acts of 2025 (the FY2026 Budget) amends the definition of 'wages' in G.L. c. 32, § 1 to clarify that accrued sick, personal, or vacation leave constitutes regular compensation when used — except when used as a supplement to Workers' Compensation under Chapter 152. This supersedes Memo #23/2023 and means that accrued leave used to supplement PFML payments is now regular compensation effective July 1, 2025, requiring retirement deductions to be withheld from such supplemental leave payments.

PERAC alerts boards to a direct-deposit fraud scheme in which a fraudster impersonated a retirement board employee and tricked a colleague into changing the employee's direct deposit information to a fraudulent account, resulting in an intercepted paycheck. The memo describes the specific methods used — email impersonation and use of Green Dot Bank — and urges boards to strengthen verbal confirmation procedures for direct deposit changes and to apply extra scrutiny to any request involving Green Dot Bank. Boards should review their identity verification policies, especially comparing procedures for retirees versus staff.

PERAC has updated the Application for Reinstatement to Service form under G.L. c. 32 § 105, effective July 1, 2025 through June 30, 2026. Section 105 allows a retired member to return to active member-in-service status, but requires repayment of all retirement allowances received and at least five years of full-time employment after reinstatement. Boards should carefully counsel interested members about the financial implications and complete the first portion of the form before providing it to the member for signature.

PERAC has issued an updated Tobacco Company List dated October 2025, which replaces all previously distributed lists and is effective upon receipt. Under Chapter 119 of the Acts of 1997, retirement systems are prohibited from making new investments in stocks, securities, or other obligations of any company that derives more than 15% of its revenue from tobacco products. Boards must forward the list to their investment advisors and note that the list is strictly for Massachusetts public fund clients only. PERAC will review portfolios for compliance during audits and any non-compliant holdings must be divested in a prudent manner after consulting with PERAC.

PERAC's 4th Quarter 2025 training memo reminds retirement board members of their statutory obligation under Chapter 32 to complete 18 credits over their term and at least 3 credits per year. The memo lists live webinars, on-demand online courses, and conferences scheduled from October through December 2025, including the MACRS Fall Conference in Springfield (December 7–10) offering up to 9 credits. Board members must use PROSPER to register and submit Training Affidavits for non-PERAC-sponsored sessions; the next New Administrator Training is November 5, 2025 in Danvers.

PERAC is requesting boards complete the FY27 appropriation questionnaire through PROSPER to allow PERAC to calculate the amounts that governmental units must appropriate under G.L. c. 32 §§ 22D, 22(6A)(b), or 22F. Boards will receive the completed FY27 appropriation letter back through PROSPER once reviewed; PERAC will no longer distribute the letter to other interested parties — the board is responsible for forwarding it. Five-year projections are no longer included in the memo but remain in the system's funding schedule.

PERAC's annual pension fraud awareness campaign is underway with the theme "See Something Fishy?" Boards are asked to display the enclosed posters and brochures prominently in their offices. The PERAC fraud hotline is 1-800-445-3266 and the email is pensionfraud@mass.gov; digital materials for social media use will be emailed separately. County and regional systems will receive additional materials to distribute to associated governmental units.

PERAC has issued updated lists of public employees ineligible to join a Chapter 32 retirement system due to forfeiture under G.L. c. 32, § 15 — typically resulting from misappropriation of funds or conviction of certain crimes. Boards must review the attached alphabetical and board-sorted lists against their active membership. Any match must be reported to PERAC's Doreen Duane with the member's full name and last four digits of SSN for confirmation before any action is taken.

Free cybersecurity awareness training is again available in 2026 for retirement board administrators and staff through EOTSS's Cybersecurity Awareness Program. Boards must designate a local coordinator, and participants must have an email tied to the board's domain (not Gmail or Yahoo). Two informational webinars are scheduled: November 18 at 10 a.m. and December 15 at 2 p.m. Applications are reviewed on a rolling basis until licenses are exhausted — boards should apply promptly.

Chapter 73 of the Acts of 2025, effective November 25, 2025, made two significant changes to the Violent Act Injury disability benefit: it revised the definition of "Violent Act Injury" in G.L. c. 32, § 1 (removing the alternative "life altering" standard and narrowing weapon language), and it extended eligibility to Massachusetts State Police officers via new G.L. c. 32, § 26(2½). The new provisions apply to any member not yet approved for disability as of November 25, 2025. PERAC is updating affected disability forms and will issue a new memo superseding Memo #15/2025 once complete.

PERAC is proposing a new subsection to 840 CMR 28.00 (Electronic Signatures) that would waive the witness signature requirement for forms submitted electronically, provided a security procedure as defined in 840 CMR 28.02 is in place. This directly affects forms such as the Beneficiary Selection Form for Refund of Accumulated Deductions. A public hearing is scheduled for January 7, 2026 at 10 a.m. via remote access; written comments are accepted through January 9, 2026 at 5 p.m.

Boards must review and update their disability retiree records in PROSPER for 2025, including address changes, deaths, nursing home placements, waived allowances, returns to active status, and Power of Attorney updates. All changes must be returned to PERAC's Sandra King by January 16, 2026, to ensure accuracy before the mailing of 2025 Annual Statements of Earned Income (91A forms). PERAC will mail 91A forms by end of February 2026; electronic filing is strongly encouraged and available to all disability retirees.

PERAC's Q1 2026 training memo outlines live webinars, on-demand training, and conferences available January through March 2026 for retirement board members to meet their Chapter 32 educational credit requirements (18 over a term, minimum 3 per year). The next New Administrator Training is March 3, 2026 in Norwood, MA. Board members must use PROSPER to register and submit Training Affidavits for non-PERAC sessions; Conflict of Interest training certificates are now required every two years through the State Ethics Commission online portal.

This memo announces that PERAC's annual review of medical testing fees under 840 CMR 10:10(3) and 10:15(1)(c) has resulted in no change for 2024. The Commission voted at its December 13, 2023 meeting to continue allowing PERAC staff to approve up to $100.00 per case for non-invasive medical tests ordered by a Regional Medical Panel. Tests exceeding that amount still require advance Commission approval. No action is required from boards beyond being aware of this continuing limit.

This memo sets the 2024 "regular interest" rate at 0.1% for regular and additional deductions made after January 1, 1984, as required by G.L. c. 32, § 22(6)(b). The rate is derived from the average rates paid on individual savings accounts at a representative sample of at least 10 financial institutions. Boards must apply this rate to accumulated total deductions for refunds, retirements, and year-end crediting on December 31, 2024.

This memo clarifies that the required minimum distribution (RMD) age is now 73 for 2024 notifications, reflecting the SECURE 2.0 Act's updated rules for members born on or after January 1, 1951. Members who turned 73 in 2023, or who turned 72 in 2022, must take their first distribution by April 1, 2024, so boards should send notices promptly. A sample notification letter is attached, and boards are encouraged to offer individual counseling given the complexity of rollover options.

This memo publishes the 2024 federal compensation and benefit limits applicable to Massachusetts public retirement systems under Chapter 46 of the Acts of 2002. The IRC § 401(a)(17) compensation limit for 2024 is $345,000, and the IRC § 415 annual benefit limit is $275,000 for a member retiring at age 65 (reduced for retirements before age 62). These limits are indexed annually and affect only the highest-paid employees; most members will not be impacted.

This memo establishes the 2024 regular compensation cap for members who joined a Massachusetts retirement system after January 1, 2011, under Section 23 of Chapter 131 of the Acts of 2010. Because the federal IRC § 401(a)(17) limit for 2024 is $345,000, the cap on regular compensation for these newer members is 64% of that figure, or $220,800. Boards must use $220,800 as the maximum pensionable compensation for any post-2010 member when calculating contributions and retirement allowances this year.

This memo notifies retirement boards of the 2024 Cost of Living Adjustment (COLA) available under G.L. c. 32, § 103(c). The Social Security Administration's CPI-W increase was 3.2%, but the maximum COLA a Massachusetts retirement board may grant is capped at 3.0%, effective July 1, 2024. Boards wishing to adopt the COLA must vote to do so in a properly posted public meeting before June 30, 2024, and must report their decision to PERAC through the new PROSPER portal within 30 days.

PERAC distributes the updated 2024 worksheets and cumulative interest factor sheets for calculating buyback and make-up repayments under the various provisions of G.L. c. 32, §§ 3 and 4. Boards should use buyback interest for make-ups under § 4 provisions, while certain § 3 make-ups (covering prior service, military service, and similar situations) may use either buyback or actuarial interest depending on circumstances described in Memo #23/2012. The packet includes three repayment worksheets each for buyback and actuarial interest, plus separate cumulative interest factor pages for each method.

Starting January 30, 2024, retirement boards can submit annual COLA approvals and COLA base changes entirely through PROSPER, replacing the previous paper-based process. Step-by-step instruction manuals are attached. Board staff with the Finance role in PROSPER will automatically have access; boards needing to add new users should complete the Individual Account Request Form and return it to PERAC's PROSPER Help Desk.

PERAC requests that all retirement boards submit actuarial data for active members, retirees, survivors, and disability retirees as of December 31, 2023, by March 31, 2024. Data should be submitted through the PROSPER portal in the standard PERAC record format. After submission, boards will receive data analysis reports in PROSPER to review and correct any errors; PERAC notes that boards scheduled for a full actuarial valuation in 2024 will have received a separate data request.

PERAC distributes the updated April 2024 Tobacco Company List, which supersedes all prior versions and is effective upon receipt. Under Chapter 119 of the Acts of 1997, retirement systems are prohibited from making new investments in any company that derives more than 15% of its revenue from tobacco product sales. Boards must forward the list to their investment advisors and, if any portfolio holdings are found to be non-compliant, must consult with PERAC before divesting in a prudent manner. The list covers more than 100 companies across roughly 30 countries.

This memo provides the 2nd Quarter 2024 mandatory training schedule for retirement board members, who are required by Chapter 32 to earn 18 credits over a board term and at least 3 credits each year. Upcoming opportunities include live webinars on the Open Meeting Law and disability basics, the MACRS Spring Conference (June 1–5 in Hyannis, which can yield up to 9 credits), and several pre-approved on-demand courses. Board members must register under their full name and submit Training Affidavits in PROSPER for any training not automatically tracked by PERAC.

PERAC announces amendments to two regulations — 840 CMR 4.00 (Financial Operations/Standard Method of Accounting) and 840 CMR 25.00 (Field Examinations) — effective March 29, 2024. Key changes to 840 CMR 4.00 include a new definitions section, requirements for daily transaction entry and monthly Trial Balance/General Ledger runs, a chart of cash book submission deadlines, and a new mandate that board staff share monthly cash books and quarterly budget comparisons with all board members. Changes to 840 CMR 25.00 clarify the triennial examination process and how PERAC may incorporate CPA examination work while still conducting its own required examination.

PERAC announces amendments to five regulations effective March 29, 2024. Notable changes include: updated travel rules (840 CMR 2.00) including IRS-rate mileage and prohibition on reimbursing personal accommodations; repeal of the now-obsolete $30,000 salary cap regulation (840 CMR 8.00), service-after-age-70 regulation (840 CMR 11.00), and most of the age-65-to-70 service regulation (840 CMR 12.00); and significant updates to the Miscellaneous regulation (840 CMR 15.00), including replacing notarized affidavits with signed attestations subject to 5% random audit, a new credit card usage subsection requiring PERAC-approved supplemental regulations, and a new non-disability hearing procedure. Boards must review their supplemental regulations and submit amendments to PERAC as needed.

PERAC distributes the updated July 2024 Tobacco Company List, which supersedes all prior versions and is effective upon receipt. Under Chapter 119 of the Acts of 1997, Massachusetts retirement systems are prohibited from making new investments in any company that derives more than 15% of its revenue from tobacco product sales. Boards must share the list with their investment advisors and, if any holdings are found non-compliant, must consult with PERAC before divesting. This mid-year update replaces the April 2024 list issued with Memo #10.

PERAC has issued PROSPER tasks to all boards for disability retirees who failed to file their 2023 Annual Statement of Earned Income (91A form) or who reported earnings that may require a benefit adjustment. Boards must provide written notice and a hearing opportunity to non-compliant retirees; benefits may be terminated after the hearing, subject to CRAB appeal. Boards are also asked to respond to upcoming "Salary Verification" tasks in PROSPER by entering 2023 pension and salary figures so PERAC can calculate whether each retiree is within their allowable earnings limit.

This memo provides the 3rd Quarter 2024 mandatory training schedule for retirement board members, who must earn 18 credits over their term and at least 3 per year. Key offerings include July and August webinars on open meeting law, fiduciary duty, and procurement, plus the PERAC Emerging Issues Forum on September 18 in Westborough (3 credits). PERAC is also launching a new New Administrator Training series, with the first session on August 21 in Northampton, designed for staff with fewer than five years of experience. All non-live-PERAC training requires a Training Affidavit submitted through PROSPER.

PERAC introduces a new Audit Process application within PROSPER that allows retirement boards to electronically submit all audit documentation, replacing the previous email and Interchange workflows. When a board is due for an audit, tasks will appear in PROSPER prompting completion of a Pre-Audit Planning Questionnaire followed by a Material List checklist. Board staff with the Finance role in PROSPER will have automatic access; new users must submit an Individual Account Request Form to the PROSPER Help Desk.

PERAC releases an updated Application for Reinstatement to Service form under G.L. c. 32 § 105, effective July 1, 2024 through June 30, 2025. This form is used when a superannuation or termination retiree wishes to return to active public employment; signing it converts the individual from retiree status back to member-in-service status. Because reinstatement may require repayment of large sums and mandates at least five years of subsequent full-time employment, boards are urged to counsel members carefully before they proceed.

The FY25 state budget, signed July 29, 2024, included a 3% COLA for State and Mass Teachers' Retirement System retirees, which triggers an increase in the supplemental dependent allowance for accidental disability retirees and accidental death survivors. Effective July 1, 2024, retirement systems that have accepted G.L. c. 32, §§ 7(2)(a)(iii) or 9(2)(d)(ii) must pay $1,125.36 per year per eligible child — an increase from the prior year's amount. Boards that have accepted these provisions should update their payment amounts accordingly.

Chapter 141 of the Acts of 2024 (Salary Transparency Act), signed July 31, 2024, amends G.L. c. 32, § 5(2)(f) to exempt from the anti-spiking provision salary increases required under the Massachusetts Equal Pay Act (MEPA) and employer-wide "systemic wage adjustments," retroactive to July 1, 2018. Because DALA had previously ruled that MEPA increases were not exempt, some members had their retirement allowances improperly reduced. Boards must now identify affected retirees, recalculate their allowances, and pay a lump-sum correction plus correction-of-errors interest, offsetting any contributions that were previously refunded when anti-spiking was applied.

Chapter 141 of the Acts of 2024 amends G.L. c. 32, § 91(b) to allow retirees returning to public-sector employment to use whichever is greater — the current salary for the position from which they retired, or the salary upon which their retirement allowance was based — when calculating their allowable earnings. The change directly overrides a 2024 CRAB decision in Dixon v. Lynn Ret. Sys. that had forced use of the current position salary only, which sometimes left retirees with no earnings capacity. Retirees who had previously been calculated using the pension-based salary are held harmless and do not need to be recalculated.

The HERO Act (Chapter 178 of the Acts of 2024), signed August 8, 2024, makes substantial changes to veterans' creditable service buybacks under Chapter 32. It replaces the old 180-day window with a new deadline of within one year of vesting (effectively 11 years of creditable service), and creates a one-year grace period — until August 8, 2025 — for active members who missed their original opportunity. Most urgently, boards must send written notice to all active members by November 6, 2024, using the sample notice attached, and must begin providing veterans' buyback information to all new members at enrollment.

PERAC distributes the updated October 2024 Tobacco Company List, which supersedes all prior versions and is effective upon receipt. Under Chapter 119 of the Acts of 1997, Massachusetts retirement systems are prohibited from making new investments in any company deriving more than 15% of its revenue from tobacco product sales. Boards must share the list with their investment advisors and consult with PERAC before divesting any non-compliant holdings. This replaces the July 2024 list issued with Memo #14.

This memo provides the 4th Quarter 2024 mandatory training schedule for retirement board members, who must earn 18 credits over their term and at least 3 per year. Key offerings include a PERAC Legislative Update webinar on October 23, the New Administrator Training in Danvers on November 19, and the Fall MACRS Conference in Springfield December 8–11 (potentially up to 9 credits). New on-demand resources include a PERAC webinar on the HERO Act/Veterans' Buyback changes. Board members must submit Training Affidavits in PROSPER for all non-PERAC-live training.

The SJC's September 2024 ruling in Hartnett v. CRAB overturned PERAC's longstanding interpretation of the G.L. c. 32, § 5(2)(a) anti-spiking provision, holding that "2 consecutive years" means consecutive calendar years — not consecutive years of creditable service. As a result, members who had anti-spiking applied based on salary differences between non-consecutive calendar years (e.g., a break in service followed by a return just before retirement) were improperly penalized. Boards must identify affected retirees, recalculate their allowances to remove any improper downward adjustment, and pay the underpayment plus correction-of-errors interest, offsetting any contributions previously refunded.

The FY25 budget (Chapter 140 of the Acts of 2024) expands the return-to-service options for disability retirees under G.L. c. 32, § 8. A disability retiree may now request evaluation for a different, specifically identified position — even with a different employer or in a different retirement system — rather than being limited to the position from which they retired. If found medically able, the member may return to active service, the original disability pension ceases, and upon eventual superannuation retirement both systems will share the pension cost under the existing multi-system rules. The CME and RTS processes remain unchanged; boards should direct all related inquiries to PERAC, which is updating its forms.

PERAC is transitioning the FY26 appropriation questionnaire and letter process entirely to PROSPER, replacing the prior paper/email workflow. Boards should complete and submit the questionnaire, which was sent via PROSPER, as soon as possible so PERAC can calculate and return the FY26 appropriation amounts under G.L. c. 32, §§ 22D, 22(6A)(b), or 22F. Two process changes to note: the 5-year projection page will no longer be included in the appropriation memorandum, and starting this year PERAC will only send the appropriation letter to the board — boards are responsible for forwarding copies to the appropriate governmental bodies.

PERAC encourages retirement board administrators and staff to apply for the free Municipal Cybersecurity Awareness Grant Program offered by the state's Executive Office of Technology Services and Security (EOTSS). Now in its sixth year, the program provides customized cybersecurity training including best-practice modules and simulated phishing attacks to help boards protect member information and system data. Boards should apply through the EOTSS grant portal as soon as possible (applications are reviewed on a rolling basis), and must designate a local coordinator and use organization-domain email addresses — not personal Gmail or Yahoo accounts — to participate.

PERAC asks boards to review and update all disability retiree records in PROSPER — including deaths, nursing home placements, address changes, allowance waivers, and returns to active status — no later than January 17, 2025, so the database is accurate before 91A forms are mailed. New for the 2024 filing year, all disability retirees will be able to file their 91A (Annual Statement of Earned Income) form electronically; PERAC will notify members via postcard in January and boards should include email addresses when updating PROSPER records. Completed 91A forms should be returned to PERAC's new Medford address by April 15, 2025.

PERAC distributes the updated January 2025 Tobacco Company List, which supersedes all prior versions and is effective upon receipt. Under Chapter 119 of the Acts of 1997, Massachusetts retirement systems are prohibited from making new investments in any company deriving more than 15% of its revenue from tobacco product sales. Boards must forward the list to their investment advisors and consult with PERAC before divesting any non-compliant holdings in a prudent manner. This update replaces the October 2024 list issued with Memo #24.

This memo provides the 1st Quarter 2025 mandatory training schedule for retirement board members, issued at the close of 2024. Key upcoming sessions include a PERAC "Preparing the Annual Statement" webinar on January 22, a "Recent Cases of Interest" webinar on February 20, a PERAC Cybersecurity webinar on March 19, and the final New Administrator Training in this series on March 26 in Norwood. Board members must earn at least 3 credits per year and 18 credits per term; all non-PERAC-live training requires a Training Affidavit submitted through PROSPER.

This memo announces that PERAC's annual review of medical testing fees under 840 CMR 10:10(3) and 10:15(1)(c) has resulted in no change for 2025. The Commission voted at its December 18, 2024 meeting to continue allowing PERAC staff to approve up to $100.00 per case for non-invasive medical tests ordered by a Regional Medical Panel. Tests exceeding that amount still require advance Commission approval. No action is required from boards beyond being aware of this continuing limit.

This memo notifies all retirement boards and public employers that the pandemic-era waiver of post-retirement earnings limitations for superannuation retirees expired on December 31, 2022, and the standard G.L. c. 32, §§ 91(b) and (c) restrictions are fully back in effect for 2023 and beyond. Post-retirement public employment is capped at 1,200 hours per calendar year, and combined earnings and retirement allowance cannot exceed the current salary for the retiree's former position plus $15,000. Boards are urged to share this memo with all employer units in their systems and to rigorously scrutinize hours and earnings paid to public sector retirees.

This memo announces the 2023 federal compensation and benefit limits that apply to Massachusetts public retirement systems under Chapter 46 of the Acts of 2002, which brought G.L. c. 32 into compliance with IRC requirements. The general compensation limit under IRC § 401(a)(17) for 2023 is $330,000, and the annual benefit limit under IRC § 415 is $265,000 for members retiring at age 65 (reduced for earlier retirement). These limits affect only the highest-paid employees and no board action is required beyond awareness that they are in effect.

This memo announces the 2023 regular compensation cap applicable to members who joined a retirement system after January 1, 2011, as established by Section 23 of Chapter 131 of the Acts of 2010. Because the federal IRC § 401(a)(17) limit for 2023 is $330,000 (per Memo #2/2023), the 2023 cap on regular compensation for post-2010 members is $211,200 (64% of $330,000). Boards must ensure that compensation above this threshold is excluded when calculating retirement benefits for affected members.

This memo provides the annual COLA notice required under Chapter 17, Section 8(c) of the Acts of 1997, advising retirement boards that the Social Security Administration announced an 8.7% CPI-W increase, which triggers the maximum statutory COLA of 3.0% available under G.L. c. 32, § 103(c) effective July 1, 2023 (FY24). Boards wishing to grant the COLA must vote to do so in a properly posted public meeting before June 30, 2023, and must notify PERAC of their decision within 30 days; notification to the legislative body is not required when the SSA COLA exceeds 3.0%.

This memo announces that retirement boards will soon be able to submit Cash Books and Annual Statements entirely through PROSPER, including board approval of the Annual Statement within the system, with the new module expected to be available in March 2023. Boards are instructed not to submit 2022 Annual Statements until after the module launches and they have attended or viewed the training webinar scheduled for February 16, 2023. Staff who currently hold the disability role in PROSPER will automatically receive the new Finance role; additional staff needing access should submit the Individual Account Request Form to PERAC.

This memo transmits the 2023 buyback and make-up repayment worksheets and cumulative interest factor sheets for use in calculating buyback and make-up payments under the various creditable service provisions of G.L. c. 32. Boards should use these updated worksheets for all buyback and make-up calculations in calendar year 2023, noting that some provisions use buyback interest exclusively while others allow either buyback or actuarial interest depending on circumstances described in Memo #23/2012. Three repayment worksheets and corresponding cumulative interest factor sheets are provided for each interest type due to varying investment return assumptions.

This memo sets the "regular interest" rate for calendar year 2023 at 0.1%, as determined by PERAC in consultation with the Commissioner of Banks based on the average rates paid on individual savings accounts at a representative sample of at least ten financial institutions, pursuant to G.L. c. 32, § 22(6)(b). This rate applies to accumulated total deductions and accrued interest for refunds and retirements credited during 2023, and to outstanding balances as of December 31, 2022 credited on that date. No action is required of boards beyond applying this rate in their calculations.

This memo requests that retirement boards submit actuarial data — active member, retiree/survivor, and disability retiree records as of December 31, 2022 — by March 31, 2023 using the standard PERAC record format through the new PROSPER portal (the Interchange File Transfer website has been deactivated). After submission, boards will receive data analysis reports identifying warnings or errors for correction; boards scheduled for a PERAC actuarial valuation in 2023 will have received a separate data request. PERAC strongly recommends sound data maintenance practices to ensure reliable and timely actuarial valuations.

This memo transmits the April 2023 Tobacco Company List, which supersedes all prior versions and takes effect upon receipt, prohibiting retirement systems from making any new investments in companies deriving more than 15% of their revenue from tobacco products as required by Chapter 119 of the Acts of 1997. Boards must forward the list to their investment advisors (noting it is for Massachusetts public fund clients only), and PERAC will assess compliance during audits; any portfolio found out of compliance must be divested in a prudent manner after consulting with PERAC. The 15% rule is applied to pooled funds based on the overall pool, not individual holdings.

This memo lists available training opportunities for retirement board members to fulfill the mandatory Chapter 32 educational credit requirements for Q2 2023 (April–June), which require 18 credits over a board term and at least 3 credits per year of service. Highlighted events include PERAC webinars, AGO Open Meeting Law sessions, MCPPO courses, the NCPERS TEDS/NAF/ACE Conference, a Veterans' Benefits webinar on May 25, and the annual MACRS Conference (June 4–7 in Hyannis, worth up to six credits). Board members can also complete pre-approved on-demand training through the AGO, IGO, NCTR, and the State Ethics Commission's new Conflict of Interest online system.

This memo advises retirement boards that Chapter 2 of the Acts of 2023, signed March 29, 2023, extends the Open Meeting Law waivers — originally enacted during the COVID-19 state of emergency — through March 31, 2025. Boards may continue to hold meetings without a physical quorum or a physically present chair, provided remote participation is utilized and the public has adequate alternative means of access; if a meeting is held in a publicly accessible physical location without alternative remote access, a physical quorum is required. No board vote is needed to continue using remote meeting options under the extended waiver.

This memo transmits an updated list of public employees who have forfeited their retirement allowance eligibility under G.L. c. 32, § 15 due to misappropriation of funds, conviction of crimes related to governmental funds, or other enumerated offenses, and are therefore no longer statutorily eligible to join a Chapter 32 retirement system. Boards are required to review the attached list (sorted both alphabetically by name and by board) and notify PERAC of any discrepancies, and boards that have any of the listed forfeited members currently active in their system must contact PERAC to verify identity using the last four digits of the member's Social Security number. This is an annual compliance task requiring boards to cross-reference their active membership against the forfeiture list.

This memo instructs retirement boards to complete the 2022 Salary Verification task in PROSPER for disability retirees, entering each retiree's 2022 annual pension, annuity, and current salary (including all incentives and COLA) so that PERAC can determine whether earnings when combined with the retirement allowance exceed the G.L. c. 32, § 91A limit of the retiree's former position salary plus $15,000. If a retiree's allowable earnings have been exceeded, PERAC will issue an Excess Earnings letter and the board must notify the retiree in writing and provide an opportunity for a hearing before commencing any recovery of excess amounts. Boards must report their action through the PROSPER task system.

This memo transmits the July 2023 Tobacco Company List, which supersedes all prior versions and takes effect upon receipt, prohibiting retirement systems from making any new investments in companies deriving more than 15% of their revenue from tobacco products under Chapter 119 of the Acts of 1997. Boards must forward the list to their investment advisors (for Massachusetts public fund use only), and PERAC will assess portfolio compliance during audits; non-compliant portfolios must be divested in a prudent manner after consulting with PERAC. This is the second tobacco list issued in 2023, following the April 2023 list in Memo #9/2023.

This memo alerts retirement boards to 91A tasks appearing in PROSPER for disability retirees who have failed to file the 2022 Annual Statement of Earned Income or whose reported earnings may require an allowance adjustment under G.L. c. 32, § 91A. Boards must provide written notice and an opportunity for a hearing to non-compliant members; PROSPER will continue sending task alerts every 30 days until a response is entered, and the board must document its action through PROSPER. The memo also previews upcoming Salary Verification tasks in PROSPER and outlines the process for entering 2022 pension and salary data to determine whether disability retirees have exceeded their allowable earnings.

This memo lists available training opportunities for retirement board members for Q3 2023 (July–September) to fulfill Chapter 32's mandatory educational credit requirements of 18 credits per term and at least 3 per year. Highlighted events include a July 13 Fiduciary Duty webinar co-hosted with the Inspector General's Office, a New Administrator Training in Northampton on August 23, and the Emerging Issues Forum in Worcester on September 21 (registration opens July 10); the memo also previews Q4 conferences including the MACRS Fall Conference in Springfield (October 1–4). Board members may also earn credits through on-demand training available through the AGO, NCTR, PERAC, and the State Ethics Commission's online Conflict of Interest system.

This memo transmits the updated Application for Reinstatement to Service from Superannuation/Termination Retirement under G.L. c. 32, § 105, which is effective July 1, 2023 through June 30, 2024. Boards are instructed to complete the first section of the form and provide it to any interested retirees, who upon signing are converted from retiree to member-in-service status; boards should carefully counsel members about the requirements, including repayment of large amounts and the requirement to work at least five years of full-time employment before the reinstatement fully takes effect. Boards with investment return assumptions not shown on the form should contact PERAC's actuarial unit for custom factors.

This memo advises retirement boards that the FY24 budget signed by Governor Healey on August 9, 2023 includes a 3% COLA for State and Mass Teachers' Retirement System retirees effective July 1, 2023, which triggers a corresponding increase in the supplemental dependent allowance. Effective July 1, 2023, any retirement system that has accepted the supplemental dependent allowance under G.L. c. 32, §§ 7(2)(a)(iii) or 9(2)(d)(ii) must pay $1,092.60 annually per eligible dependent child. Boards that have accepted the relevant statutory provisions must update their payment amounts immediately to reflect this increase.

This memo transmits the October 2023 Tobacco Company List, which supersedes all prior versions and takes effect upon receipt, prohibiting retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco products under Chapter 119 of the Acts of 1997. Boards must forward the updated list to investment advisors (for Massachusetts public fund clients only) and PERAC will verify compliance during audits; non-compliant portfolios must be divested prudently after consulting PERAC. This is the third tobacco list issued in 2023, following the April 2023 (Memo #9) and July 2023 (Memo #14) lists.

This memo lists available training opportunities for retirement board members for Q4 2023 (October–December) to fulfill the Chapter 32 mandatory educational credit requirements. Key events include the MACRS Fall Conference in Springfield (October 1–4, up to nine credits), a New Administrator Training in Danvers on November 14, a Recent Cases of Interest PERAC webinar on December 14, and multiple OIG Academy and AGO Open Meeting Law sessions throughout the quarter. The memo also notes that the Inspector General's MCPPO program has been renamed OIG Academy, and reminds boards that credits for live PERAC webinars are automatically recorded while other trainings require a Training Affidavit in PROSPER.

This memo transmits the updated text of PERAC's travel and expense regulations at 840 CMR 2.00, showing tracked changes to the existing rules governing retirement board member and staff travel, lodging, meals, and reimbursements. Notable revisions include clarified language on board authorization procedures for travel, updated provisions for mandatory resort fees (now potentially reimbursable if they include internet/Wi-Fi), updated credit card usage rules under the newly numbered § 2.11, and refined conflict-of-interest restrictions on third-party reimbursements. Boards whose supplementary travel regulations were approved by PERAC before June 6, 2003 remain valid, and boards may adopt updated supplementary regulations consistent with the revised CMR by submitting them to PERAC for approval.

This memo requests that retirement boards submit the annual appropriation data questionnaire by October 31, 2023, which PERAC uses to calculate FY25 appropriation amounts to be assessed against governmental units under G.L. c. 32, §§ 22D, 22(6A)(b), or 22F. Boards are strongly encouraged to submit through the PERAC website rather than by mail; the previously included five-year projection page has been discontinued, and boards needing to make pension reserve fund transfers should petition PERAC's actuary for approval under § 22(6A)(b). Timely submission is critical to ensure accurate FY25 funding schedule calculations.

This memo addresses a change in Massachusetts Paid Family and Medical Leave (PFML) law — effective November 1, 2023 under Chapter 55 of the Acts of 2023 — which now allows employees on PFML to supplement their benefits with accrued paid leave (sick, vacation, PTO, etc.), up to the employee's Individual Average Weekly Wage. Despite this change, PERAC clarifies that neither PFML benefits nor supplemental accrued leave payments constitute "regular compensation" under Chapter 32, relying on SJC precedent from Vernava I and Vernava II, because the employee is not performing services during leave; therefore, the period of PFML with supplemental pay does not generate creditable service. No board action is required beyond ensuring that retirement benefits are not enhanced based on income received while on PFML leave.

This memo establishes PERAC's policy on the use of Outsourced Chief Investment Officers (OCIOs) by retirement boards, describing two permissible models: a "Proprietary OCIO" (which invests in the OCIO's own funds without asset limits) and a "Full OCIO" (which acts as a discretionary investment manager, limited to 10% of board assets). Boards selecting either type of OCIO must follow the same Section 23B procurement process as for any investment manager, and the OCIO must meet nine specific requirements, including fiduciary acknowledgment, flat-fee compensation, full disclosure submissions, and a board-approved process for reviewing manager selections. This memo supersedes Memorandum 18 of 2014 with respect to discretionary manager selections.

This memo informs retirement board administrators and staff of a free cybersecurity training opportunity through the state's Municipal Cybersecurity Awareness Grant Program, offered by the Executive Office of Technology Services and Security (EOTSS), with optional informational webinars on November 8 and 15 and December 6 and 13, 2023. Applications are accepted until January 10, 2024 or until capacity is reached; participants must have a retirement board domain email address and designate a local coordinator. PERAC encourages participation based on positive feedback from boards that completed the program previously, including the Middlesex County Retirement Board.

This memo launches PERAC's 2023 pension fraud prevention campaign, themed "Pension Fraud is a Crime. Be a Superhero!", and encloses posters, brochures, and Referral Report of Potential Fraud forms for boards to display and distribute. Boards are asked to post the materials prominently, share the fraud reporting hotline (1-800-445-3266) and email (PensionFraud@mass.gov), and refer suspected fraud to PERAC's Fraud Unit; county and regional systems will receive additional materials for their constituent governmental units under separate cover. This is part of PERAC's ongoing statutory obligation to maintain a confidential fraud reporting hotline, which has operated since 1998.

This memo explains the implementation of Section 82 of Chapter 28 of the Acts of 2023, which gives active members who elected to stop retirement contributions at age 70 under the repealed G.L. c. 32, § 90G 3/4 a one-time opportunity to rescind that election and receive creditable service for years worked after age 70. To be eligible, members must have maintained continuous service since their election, be active as of November 29, 2023, and elect to restart contributions and make up all missed contributions plus buyback interest by January 29, 2024 (60 days from PERAC's IRS clearance date). Boards must immediately identify any qualifying active members and provide them with the necessary information and the attached application form.

This memo requests that retirement boards review and update their disability retiree records in PROSPER by January 15, 2024 to reflect all changes that occurred in 2023, including deaths, nursing home placements, allowance waivers, returns to active status, and address changes. Boards can now update addresses directly in PROSPER via the Member Update function; status changes and discrepancies should be annotated on the exported member list and emailed to Sandra King, and boards with no changes must still send a confirmation email. Accurate data must be submitted by the deadline to ensure PERAC's disability retiree database is correct before the February mailing of the 2023 Annual Statements of Earned Income (91A forms).

This memo transmits the January 2024 Tobacco Company List, which supersedes all prior versions and takes effect upon receipt, prohibiting retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco products under Chapter 119 of the Acts of 1997. Boards must forward the list to investment advisors (for Massachusetts public fund clients only), and PERAC will assess portfolio compliance during audits; boards found out of compliance must divest prudently after consulting PERAC. This is the fourth and final tobacco list issued in the 2023 memo series, replacing the October 2023 list from Memo #19/2023.

This memo lists available training opportunities for retirement board members for Q1 2024 (January–March) to satisfy the Chapter 32 mandatory educational credit requirements, including a January 18 Contract Administration webinar co-hosted by PERAC and OIG, AGO Open Meeting Law sessions, a February 15 Annual Statement webinar, NASRA's Winter Meeting in Washington D.C. (February 24–26), and a New Administrator Training in Norwood on March 21. Pre-approved on-demand training is also available through the AGO, IGO, National Institute on Retirement Security, and PERAC's website; the Conflict of Interest online training through the State Ethics Commission remains available for three credits once every two years. Board members should register through PROSPER for PERAC-hosted events.

This memo alerts all retirement boards to an attempted cyberattack in which a fraudster impersonated a board administrator to obtain funds from the board's custodian. Boards are directed to implement secondary confirmation measures — including phone verification — for all financial and investment transactions, and to treat any messages expressing urgency or requesting wire changes with heightened scrutiny. PERAC urges boards to share the memo with their investment providers and immediately review transaction protocols.

This memo announces the 2022 federal compensation and benefit limits applicable to Massachusetts public retirement systems under Chapter 46 of the Acts of 2002. The general compensation limit under IRC § 401(a)(17) is $305,000 for 2022, while the § 415 benefit limit is $245,000 per year for members retiring at age 65 (reduced for retirement before age 62). These limits affect only the highest-paid employees and are indexed annually.

This memo notifies retirement boards that the 2022 COLA under G.L. c. 32, § 103(c) is capped at 3.0%, despite the Social Security Administration announcing a 5.9% CPI-W adjustment. Boards wishing to adopt the COLA must vote in a properly posted public meeting with 30 days' notice to the legislative body, both steps completed before June 30, 2022 for a July 1 effective date. All boards must notify PERAC of their decision within 30 days.

This memo establishes the "regular interest" rate for calendar year 2022 at 0.1%, as determined by PERAC in consultation with the Commissioner of Banks pursuant to G.L. c. 32, § 22(6)(b). This rate applies to accumulated total deductions and accrued interest for regular and additional deductions made after January 1, 1984, and must be credited for all refunds, retirements, and outstanding year-end balances in 2022.

This memo outlines mandatory training opportunities for retirement board members in the first quarter of 2022, reminding boards that Chapter 32 requires 18 credits over a board member's term and at least 3 credits per year. Scheduled sessions include webinars on Open Meeting Law, Conflict of Interest, procurement, and new offerings on cybersecurity and internal control plan development in collaboration with the State Comptroller and State Police. Board members must register through PERAC's website and submit Training Affidavits in PROSPER for any non-live sessions.

This memo distributes the 2022 buyback and make-up repayment worksheets and cumulative interest factor sheets for use in calculating service purchases under various provisions of G.L. c. 32. Boards must use the buyback interest or actuarial interest worksheet depending on the specific statutory subsection involved, with three repayment worksheets provided for each rate type along with cumulative interest factor sheets. Questions should be directed to John Boorack at PERAC.

This memo requests that all retirement boards submit actuarial data for active members, retirees/survivors, and disability retirees as of December 31, 2021, by March 31, 2022. Data should be submitted in the standard PERAC record format via the Interchange File Transfer website to PER-edoc-Actuary@per.state.ma.us; after submission, boards will receive data analysis reports to review and correct errors before actuarial valuations are completed.

This memo notifies retirement boards that the Open Meeting Law waivers have been extended to July 15, 2022 under Chapter 22 of the Acts of 2022, allowing boards to continue holding meetings without a physical quorum or the chair physically present provided remote participation is used and the public has adequate alternative access. Where a meeting is held in a publicly accessible physical location, alternative public access is encouraged but not required. Boards meeting in person without alternative access must have a physical quorum present.

PERAC Memo #10/2022 transmits the updated April 2022 Tobacco Company List, which replaces all prior versions and takes effect immediately upon receipt. Boards must forward the list to their investment advisors (or notify them it is on the PERAC website), ensure no new investments are made in listed companies (those deriving over 15% of revenue from tobacco, including pooled funds meeting that threshold), and consult with PERAC before divesting to bring any non-compliant portfolio into compliance.

This memo outlines mandatory training opportunities for retirement board members in the second quarter of 2022, including webinars on Open Meeting Law, Conflict of Interest, procurement fraud, and public sector ethics, as well as the return of the in-person MACRS Spring Conference in Hyannis (June 12–15) offering up to six educational credits. Board members must register through links on the PERAC website and submit Training Affidavits in PROSPER for recorded sessions, with a certificate required for any non-PERAC training.

This memo transmits an updated list of all public employees who have forfeited eligibility to join a Chapter 32 retirement system under G.L. c. 32, § 15 due to misappropriation of funds or conviction of enumerated crimes. Boards are asked to review the attached alphabetical lists and notify PERAC of any discrepancies; if any forfeited member appears active in a board's system, boards must contact Doreen Duane with the last four digits of the member's Social Security number to confirm the individual's identity.

This memo requests that retirement boards verify 2021 salary information for disability retirees through the PROSPER system to determine whether any retiree exceeded their allowable post-retirement earnings limit under G.L. c. 32, § 91A. Boards must enter each disability retiree's 2021 annual pension and current salary figures into PROSPER, which will calculate whether earnings thresholds have been exceeded. Where excess earnings are found, PERAC will issue an Excess Earnings letter and boards must notify the retiree and suspend the allowance until any overpayment is recovered.

This memo transmits the quarterly Tobacco Company List dated July 2022, which supersedes all prior lists and takes effect immediately upon receipt by retirement boards. Under Chapter 119 of the Acts of 1997, boards are prohibited from making new investments in companies deriving more than 15% of revenue from tobacco products, and must forward this list to their investment advisors for use only with Massachusetts public fund clients. PERAC will review each board's portfolio for compliance during audits and requires non-compliant boards to divest in a prudent manner after consulting PERAC.

Chapter 80 of the Acts of 2022, signed June 7, 2022, waives the post-retirement earnings and hours restrictions of G.L. c. 32, § 91(b) and (c) for superannuation retirees working in the public sector for calendar year 2022, effective retroactively to January 1, 2022. The waiver will remain in place through December 31, 2022 or up to 90 days after the end of the declared Public Health Emergency, whichever comes first, and does not apply to disability retirees. Compliance with post-retirement restrictions remains the statutory responsibility of the employee and the employer.

This memo announces the 3rd Quarter 2022 mandatory training schedule for retirement board members, who are required by Chapter 32 to earn at least 3 credits per year of service and 18 credits over each full term. The schedule includes webinars, in-person sessions, and conferences from July through October 2022, highlighted by the return of the in-person Emerging Issues Forum on September 15, 2022 at the College of the Holy Cross in Worcester. Board members must register for live events through PROSPER and submit Training Affidavits for pre-recorded or independently attended sessions.

This memo advises retirement boards that the COVID-era Open Meeting Law waivers permitting fully virtual meetings were set to expire on July 15, 2022, and instructs boards to prepare to resume in-person meetings with a physical quorum, including the chair, present. Boards that have adopted remote participation policies under 940 CMR 29.10 may still allow some members to participate remotely, but a quorum must be physically present and all votes in such meetings must be taken by roll call. PERAC notes that competing legislative proposals to extend the waiver are pending and commits to notifying boards immediately if the waiver is extended.

This memo updates Memo #18 of 2022 to inform retirement boards that the Legislature and Governor extended the Open Meeting Law virtual meeting waivers through March 31, 2023, via Section 4 of Chapter 107 of the Acts of 2022. Until that date, retirement boards may continue to hold meetings without a physical quorum or the chair physically present, provided remote participation and adequate alternative means of public access are utilized. Boards that choose to meet in a publicly accessible location without alternative means of access must have a physical quorum present.

This memo announces an updated version of the PERAC Application for Reinstatement to Service from Superannuation/Termination Retirement under G.L. c. 32, § 105, effective July 1, 2022 through June 30, 2023. Boards are directed to carefully counsel members interested in reinstatement, as applicants must repay retirement allowances received and work at least five years of full-time employment after reinstatement. Upon signing the form, the member transitions from retiree status back to member-in-service status.

This memo provides a critical update to Memo #14 of 2022, informing boards that Section 149 of Chapter 126 of the Acts of 2022 (the FY2023 budget), signed July 28, 2022, protects all retirees who retired prior to July 1, 2022 from any reduction, modification, or recoupment of allowances due to the Vernava decisions. As a result, the instructions in Memo #14 regarding retired members and their beneficiaries are hereby superseded, and no retiree who retired before July 1, 2022 will lose their allowance, lose health insurance, or be required to reimburse the retirement system. All instructions in Memo #14 concerning active and inactive members who have not yet retired remain in full effect.

This comprehensive memo addresses the regular compensation status of vacation buyback payments following the enactment of G.L. c. 32, § 106 (Chapter 147 of the Acts of 2022) and the SJC's August 2022 decision in O'Leary v. CRAB. Under the new law, existing retirees whose allowances included vacation buyback payments are protected and their allowances will not be reduced; active members who were participating in such programs as of May 1, 2018, and whose retirement systems accepted contributions on those programs, may continue to have qualifying payments treated as regular compensation going forward. Boards are given detailed implementation instructions covering retirees, active members, and the interaction with CRAB's November 2018 partial stay order, which is now superseded.

This memo outlines mandatory training opportunities for retirement board members in the fourth quarter of 2022, including the Fall MACRS Conference in Springfield (October 2–5, up to nine credits), the NCTR 100th Conference in Tucson, and an in-person Administrator Training on November 15 in Danvers. Boards must register through PERAC's website or PROSPER, and board members attending the MACRS and Administrator Training sessions will earn educational credits automatically.

This memo distributes the updated October 2022 Tobacco Company List, which replaces all previous lists and is effective immediately upon receipt. Under Chapter 119 of the Acts of 1997, retirement systems are prohibited from making new investments in companies deriving more than 15% of their revenue from tobacco products; boards must forward the list to their investment advisors and consult with PERAC before divesting any non-compliant holdings identified in PERAC's audit process.

This memo requests that retirement boards submit appropriation data by October 31, 2022, needed for PERAC to calculate FY24 appropriation amounts for all governmental units under G.L. c. 32, §§ 22D, 22(6A)(b), or 22F. Boards should submit the questionnaire through the PERAC website rather than by hard copy, and PERAC notes it will no longer include the five-year projection page in appropriation memos — future payment projections are available in each system's current funding schedule.

This memo makes retirement board administrators and staff aware of a free state-sponsored cybersecurity training program — the Municipal Cybersecurity Awareness Grant Program offered by the Executive Office of Technology Services and Security (EOTSS). The program includes assessment, quarterly training modules, and simulated phishing campaigns over a full year or shorter periods; participants must have a retirement board domain email address, and boards must designate a local coordinator. Applications close when spaces are filled or December 31, 2022, whichever comes first.

This memo explains PERAC's newly published regulations (840 CMR 28.00) authorizing electronic signatures on retirement forms, which took effect September 30, 2022. Boards are not required to allow electronic signatures and may limit them to specific forms or prohibit them entirely; however, boards that choose to permit them must vote to do so, promulgate their own regulations specifying which forms are covered and detailing security procedures, and submit those regulations to PERAC for approval before use. Members and beneficiaries always retain the right to use a wet signature.

This memo explains Chapter 269 of the Acts of 2022, signed November 16, 2022, which gives local retirement systems a one-time option to increase the FY2023 COLA to up to 5% on the applicable base amount under G.L. c. 32, § 103, retroactive to July 1, 2022. The approval process differs by municipality type — cities require city council action on the mayor's or city manager's recommendation, towns require select board approval, and regional/county systems require approval by two-thirds of member cities and towns. PERAC Actuary John Boorack provides a formula for estimating the full cost of the enhanced COLA.

This memo notifies boards that PERAC has filed proposed amendments to 840 CMR 3.00 (IRS Code Compliance Provisions) and 840 CMR 13.00 (Service Purchases and Buybacks) to ensure Chapter 32 plans meet IRS requirements under G.L. c. 32, § 12D. Two public hearings are scheduled via Zoom on December 15 and December 19, 2022, with written comments accepted through December 21, 2022; boards are invited to review the attached proposed amendments and submit comments to PERAC Associate General Counsel Felicia McGinniss.

This memo notifies boards that the Commission voted at its December 7, 2022 meeting to continue allowing PERAC staff to approve up to $100.00 per case for non-invasive medical testing associated with the Regional Medical Panel process under 840 CMR 10:10(3) and 10:15(1)(c). Medical panels rarely order tests directly since member providers typically supply test results; any test cost exceeding the $100.00 annual limit requires advance Commission approval.

This memo distributes the updated January 2023 Tobacco Company List, which replaces all previous lists and is effective immediately upon receipt. Under Chapter 119 of the Acts of 1997, retirement systems are prohibited from making new investments in companies deriving more than 15% of their revenue from tobacco products; boards must forward the list to their investment advisors and consult with PERAC before divesting any non-compliant holdings identified in PERAC's audit process.

This memo outlines mandatory training opportunities for retirement board members in the first quarter of 2023, including webinars on Open Meeting Law, Contract Administration, Conflict of Interest, and Fraud Awareness, as well as an in-person administrator training on March 28 in Norwood for new board staff. Board members earn three credits per session and must submit Training Affidavits in PROSPER for non-live sessions, while certificates of completion are required for any non-PERAC-sponsored training.

This memo requests that retirement boards review and update their disability retiree records in PROSPER by January 27, 2023, reflecting any address changes, deaths, nursing home placements, allowance waivers, or returns to active status that occurred during 2022. Boards can update most information directly in PROSPER; for Power of Attorney address changes, boards must contact Sandra King. Boards with no changes must email Ms. King confirming no updates, as the data must be accurate before PERAC mails the 2022 Annual Statements of Earned Income (91A) in February.

Sets the 2021 PERAC-approved maximum reimbursement for non-invasive medical testing at $100.00 per case under 840 CMR 10:10(3) and 10:15(1)(c), continuing the prior year's practice. Voted at the November 18, 2020 Commission meeting.

Sets the 2021 IRC Section 401(a)(17) compensation limit at $290,000 and the Section 415 annual benefit limit at $230,000 (at age 65, reduced before age 62) per Chapter 46 of the Acts of 2002. Applies only to the highest-paid members whose compensation or benefit would otherwise exceed the federal caps.

Sets the 2021 cap on regular compensation for members who joined on or after January 1, 2011 at $185,600 — 64% of the $290,000 federal 401(a)(17) limit established in Memo #2/2021. Derives from Section 23 of Chapter 131 of the Acts of 2010.

Reports the 2021 Social Security COLA of 1.3%, establishing the baseline COLA boards may grant under G.L. c. 32, § 103(c) effective July 1, 2021. Boards may vote to increase the COLA up to 3.0% before June 30, 2021 and must notify PERAC within 30 days of any vote.

Announces that Statement of Financial Interests (SFI) submissions are available entirely within PROSPER beginning February 1, 2021, carrying over prior year data. Training webinars offered February 2 and 9 (3 education credits each); SFI due date remains May 1, 2021.

Sets the 2021 "regular interest" rate on member contributions at 0.1% per G.L. c. 32, § 22(6)(b). Applies to accumulated deductions and accrued interest for refunds, retirements, and December 31, 2021 year-end balances.

Distributes 2021 buyback and make-up repayment worksheets and cumulative interest factor sheets for G.L. c. 32, §§ 3 and 4. Three worksheet sets each for buyback interest and actuarial interest (expanded from two sets in 2020); consult PERAC Memo #23/2012 to determine which interest rate applies.

Implements the SECURE Act change requiring Required Minimum Distributions at age 72 for members born after June 30, 1949. Initial distributions for those who reached 72 in 2020 are due by April 1, 2021; the old age-70½ rule continues for members who reached that age before January 1, 2020.

Requests boards submit actuarial data for active members, retirees/survivors, and disability retirees as of December 31, 2020, due March 31, 2021 via PERAC's Interchange File Transfer system in the standard PERAC format.

Transmits the updated list of public employees ineligible to join a Chapter 32 retirement system under G.L. c. 32, § 15 due to misappropriation, criminal conviction, or related offenses. Most recent additions are bolded; boards should check the list against their active members.

PROSPER benefit calculation submission is now mandatory — PERAC will not accept mailed calculations received after March 5, 2021. Since November 2020, over 550 calculations have been submitted via the system. Boards needing help can watch the tutorial at mass.gov/info-details/prosper-benefit-calculations or contact the PROSPER help desk.

Transmits the Q2 2021 (April 2021) Tobacco Company List, updating the roster of companies prohibited from new investment under Chapter 119 of the Acts of 1997 (15% tobacco revenue threshold). Supersedes all prior lists and is effective upon receipt by retirement boards.

Extends the 2020 Annual Statement of Earned Income (91A) filing deadline for disability retirees to May 17, 2021, matching the federal and Massachusetts state income tax filing extensions announced March 17–19, 2021.

Q2 2021 mandatory board member training schedule (April–June 2021), all-virtual due to COVID. Includes PERAC webinars on SFI submission, legislative update, and liability/dual membership, plus the June MACRS Conference (6 credits). Registration must be done through website links; recorded sessions require a Training Affidavit in PROSPER.

Guidance as COVID Emergency Orders expire June 15, 2021, covering: 91A filing status, annual affidavit notarization rules, board elections resuming, medical panel restart, PERAC office reopening June 1, post-retirement earnings limits reinstated June 15, and return to in-person Open Meeting Law quorum requirements (remote participation rules pending legislative action).

Chapter 20 of the Acts of 2021 (signed June 16) extends two COVID emergency measures: (1) fully remote Open Meeting Law participation is permitted through April 1, 2022; (2) virtual notarization for annual affidavits is extended through December 15, 2021. Updates and supersedes portions of Memo #16/2021.

PERAC revised the Member's Application for Distribution of Accumulated Total Deductions and created a new Beneficiary Application to standardize refund procedures across all Massachusetts retirement systems and update payment options to comply with federal tax law. Both forms are available on the PERAC website under Forms.

Q3 2021 mandatory board member training schedule (July–September 2021), all-virtual. Highlights include a PERAC/OIG webinar on fiduciary duty and fraud awareness, a new self-guided cybersecurity training through Wizer (register by July 15), and the Retirement Onramp session for new members. No Emerging Issues Forum in September.

Transmits the Q3 2021 (July 2021) Tobacco Company List, updating the roster of companies prohibited from new investment under Chapter 119 of the Acts of 1997 (15% tobacco revenue threshold). Supersedes all prior lists and is effective upon receipt by retirement boards.

The FY22 budget (signed July 16, 2021) included a 3% COLA for State and Teachers' Retirement System retirees, triggering a corresponding increase to the supplemental dependent allowances under G.L. c. 32, §§ 7(2)(a)(iii) and 9(2)(d)(ii). The new annual amount per eligible child is $1,010.28 effective July 1, 2021, for systems that have accepted those provisions or § 22D.

Announces the updated Application for Reinstatement to Service from Superannuation/Termination Retirement under G.L. c. 32, § 105 (effective July 1, 2021 through June 30, 2022). Members considering reinstatement must repay contributions and commit to at least five years of full-time service; boards should carefully counsel members on the requirements before they sign the form.

Instructs boards on handling 91A PROSPER tasks for disability retirees who failed to file the 2020 Annual Statement of Earned Income or whose earnings may require a benefit adjustment. Boards must provide written notice and a hearing opportunity; PROSPER will also issue Salary Verification tasks requiring boards to enter 2020 annual pension and current salary figures for excess earnings calculations.

Chapter 29 of the Acts of 2021 (signed July 29) amends G.L. c. 32, § 100 to extend surviving-spouse pension eligibility to police officers killed or fatally injured while at the scene of an emergency in the performance of their duties, aligning police with the existing language for firefighters. The amendment is retroactive to June 3, 2021.

Transmits the Q4 2021 (October 2021) Tobacco Company List, updating the roster of companies prohibited from new investment under Chapter 119 of the Acts of 1997 (15% tobacco revenue threshold). Supersedes all prior lists and is effective upon receipt by retirement boards.

Q4 2021 mandatory board member training schedule (October–December 2021), all-virtual due to the Delta variant. Includes the October MACRS Conference (6 credits), a PERAC/OIG contract administration webinar, Recent Cases of Interest webinar, and the December Conflict of Interest training. Registration via website links; recorded sessions require a Training Affidavit in PROSPER.

Requests boards submit FY23 appropriation data via the PERAC website questionnaire by October 31, 2021, necessary for PERAC to calculate governmental unit contribution amounts under G.L. c. 32, §§ 22D, 22(6A)(b), or 22F per the board's funding schedule.

Per consistent CRAB caselaw (Levesque, Goode, Awad), elected officials who did not apply for retirement system membership within 90 days of assuming office under G.L. c. 32, § 3(1)(a)(vi) are ineligible to buy back that prior service. Failure to notify does not excuse non-compliance. Exception: if a board actively prevented timely enrollment, correction is required under § 20(5)(c)(2).

H 4007, enacted over the Governor's veto, increases the annual public-sector work hour cap for Chapter 32 retirees (both superannuation and disability) from 960 to 1,200 hours, effective retroactively to July 1, 2021. Does not change earnings limits. A subsequent technical correction (Chapter 76 of 2021) updated the parallel reference in § 91(c).

Alerts retirement boards to a phishing scheme in which a former employee's board email account was hacked and used to fraudulently transfer investment assets. Boards should review IT user access authorizations, remove departed staff immediately, confirm vendor security protocols for wire instructions, and conduct diligent review of bank and investment statements.

Announces the 2021 Pension Fraud Prevention Campaign ("Help Take a Bite Out of Pension Fraud!") and distributes posters, brochures, and Referral Report forms for display. The PERAC fraud hotline is 1-800-445-3266; reports can also be submitted to PensionFraud@per.state.ma.us or at mass.gov/pensionfraud.

Following a successful phishing attack on a retirement board (Memo #30/2021), PERAC mandates immediate cybersecurity steps: report any intrusion to PERAC immediately; obtain an IT environment assessment; attend a Q1 2022 PERAC cybersecurity awareness program; and develop an Internal Control Plan, which PERAC will provide a sample of. Increased audit scrutiny of IT security and internal controls will begin in 2022.

Transmits the Q1 2022 (January 2022) Tobacco Company List, updating the roster of companies prohibited from new investment under Chapter 119 of the Acts of 1997 (15% tobacco revenue threshold). Issued in December 2021; supersedes all prior lists and is effective upon receipt by retirement boards.

Requests boards review and update disability retiree records in PROSPER to reflect all 2021 changes (deaths, nursing home placements, allowance waivers, returns to active status, address changes). Updates must be returned to Sandra King by January 14, 2022, to ensure accuracy before PERAC's February mailing of the 2021 § 91A Annual Statements of Earned Income.

Sets the 2022 PERAC-approved maximum reimbursement for non-invasive medical testing at $100.00 per case under 840 CMR 10:10(3) and 10:15(1)(c), continuing the prior year's practice. Voted at the December 8, 2021 Commission meeting.

Transmits the Q1 2020 Tobacco Company List, updating the roster of companies prohibited from new investment under Chapter 119 of the Acts of 1997 (15% tobacco revenue threshold). Boards must forward the list to investment advisors; PERAC will review portfolios for compliance during audits, and non-compliant boards must divest in a prudent manner after consulting PERAC.

Releases PERAC's 2018 Comparative Analysis of Investment-Related Expenses, detailing management, custodian, and consultant fees for each public pension system based on 2018 Annual Statements of Financial Condition. The report provides a benchmarking tool for board members, public officials, and taxpayers to assess each system's investment costs against those of peer systems.

Announces mandatory retirement board member training opportunities for Q1 2020, including PERAC-offered sessions on the 2018 Fee Report, online trainings, and pre-approved external programs. Board members must complete 18 credits per term with at least 3 per year; failure to meet this requirement bars the member from serving beyond the conclusion of that term.

Provides guidance and template documents — an Investment Consultant Questionnaire and a Selection Evaluation Scoresheet — for retirement boards conducting investment consultant RFP processes. RFP scoring must be completed before fee proposals are opened to prevent fee submissions from influencing the assessment; finalists are then selected for interviews and scored on a composite basis.

Sets the 2020 IRC Section 401(a)(17) compensation limit at $285,000 and the Section 415 benefit limit at $230,000 per year for retirement at age 65 (reduced for retirement before age 62). These federal limits, required under Chapter 46 of the Acts of 2002, apply only to the highest-paid members and affect the regular compensation used to calculate retirement allowances.

Sets the 2020 cap on regular compensation for members who joined a retirement system after January 1, 2011 at $182,400 — 64% of the $285,000 federal 401(a)(17) limit per PERAC Memo #5/2020. This limit derives from Section 23 of Chapter 131 of the Acts of 2010 and governs what portion of salary may be used when calculating retirement allowances under G.L. c. 32.

Reports the 2020 Social Security COLA of 1.6%, which sets the baseline COLA retirement boards may grant effective July 1, 2020 under G.L. c. 32, § 103(c). Boards may vote to increase the COLA up to 3.0% with proper notice to the legislative body before June 30, 2020, and must notify PERAC of their decision within 30 days.

Requests that retirement boards submit actuarial data for active members, retirees/survivors, and disability retirees as of December 31, 2019, due by March 31, 2020 via PERAC's Interchange File Transfer system in standard PERAC format. Boards will receive data analysis reports to review and correct errors; those scheduled for a 2020 actuarial valuation will have received a separate request.

Distributes the 2020 buyback and make-up repayment worksheets and cumulative interest factor sheets for calculating service credit purchases under multiple G.L. c. 32 provisions (§§ 3 and 4). Two sets of worksheets cover buyback interest and actuarial interest respectively; boards should consult PERAC Memo #23/2012 to determine which rate applies to each transaction type.

Sets the 2020 "regular interest" rate on member contributions at 0.1%, as determined by averaging rates paid on individual savings accounts at a representative sample of financial institutions per G.L. c. 32, § 22(6)(b). This rate applies to accumulated deductions and accrued interest for refunds, retirements, and year-end balances throughout calendar year 2020.

Following the SJC's decision in Plymouth Retirement Board v. CRAB, 483 Mass. 600 (2019), establishes that service credited under G.L. c. 32, § 4(2)(b) for reserve/intermittent police and fire personnel must be paid for, and applies the "Under $5,000 Rule" to such service after July 1, 2009. Supersedes Memo #29/2016 and requires boards to audit active members and retirees to verify payment and remove any post-2009 service that no longer qualifies.

Clarifies that IRS Determination Letters issued in August 2014 to all 104 Chapter 32 retirement systems remain valid with no expiration date, per IRS Revenue Procedure 2016-37. Expiration dates included in letters issued before January 4, 2016 are no longer operative; boards may continue to rely on their letters for plan provisions not subsequently amended or affected by a change in law.

Advises that despite the federal SECURE Act raising the Required Minimum Distribution age to 72, the prior rule (age 70½) still applies for 2020 notifications to members who reached age 70½ on or before December 31, 2019. Initial distributions for those who reached 70½ in 2019 must be made by April 1, 2020; a future PERAC memo will address the SECURE Act's prospective changes.

PERAC's first COVID-19 contingency planning memo, addressing remote board meeting participation under Governor Baker's Executive Order, continued medical panel scheduling with possible delays, flexibility for 91A filings, estimated retirement payments for new retirees, and remote operations protocols. Boards are urged to update their websites and phone messages with current office status information.

Announces that effective March 16, 2020, PERAC's Somerville office is closed to the public and all staff are working remotely. Retirement boards are encouraged to adopt estimated payments for new retirees awaiting PERAC approval and to update their websites and member communications with current office status and contact information.

Third COVID-19 update consolidating earlier guidance, covering teleconference board meetings, immediate suspension of PERAC medical panel scheduling, extension of 91A filing deadline to July 15, annual statement extension flexibility, pension funding impacts from the economic downturn, and retiree payroll continuity requirements during the March 24–April 7, 2020 shelter-in-place order.

Q2 2020 mandatory board member training memo listing exclusively online education opportunities due to COVID-19 restrictions. Notes that the state of emergency alone will not justify waivers of the 3-credit-per-year requirement; includes pre-approved online trainings from PERAC, PRIM, the Ethics Commission, OIG, and OAG. The June MACRS Conference status remains pending.

PERAC Memo #19/2020 transmits the updated Tobacco Company List (dated April 2020), which supersedes all prior versions and is effective immediately upon receipt. Boards must forward the list (or notify) their investment advisors that it applies solely to Massachusetts public fund clients, ensure no new prohibited investments (including in pooled funds exceeding the 15% tobacco-revenue threshold) are made, and consult with PERAC before divesting any non-compliant holdings identified during audit review.

Fourth COVID-19 update addressing post-retirement work hour/earnings exclusions during the State of Emergency per Chapter 53 of the Acts of 2020, retirement calculation processing status, a 30-day extension of the Annual Statement deadline to June 1, 2020, medical panel alternatives via records review or teleconference, treatment of FFCRA paid sick leave as regular compensation, and extension of 91A filing deadline to July 15, 2020.

Explains Chapter 53 of the Acts of 2020 suspending G.L. c. 32, § 91 post-retirement work earnings and hours restrictions during the Governor's State of Emergency (beginning March 10, 2020). Hours and earnings during the emergency period are excluded from the CY 2020 limits regardless of whether the work is COVID-related; disability retirees are explicitly excluded from this accommodation.

Addresses COVID-19-related concerns about delayed FY21 municipal appropriation payments, clarifying that retirement boards have authority to adjust interest calculations for payments made on dates different from those in their funding schedules. Any resulting change in unfunded actuarial liability will be accounted for in the next schedule; PERAC encourages boards to work with member units on mutually beneficial administrative solutions.

PERAC Memo #23/2020 transmits the updated (July 2020) Tobacco Company List pursuant to Chapter 119 of the Acts of 1997, which bars retirement systems from making new investments in companies deriving more than 15% of revenue from tobacco sales. This list supersedes all prior versions effective immediately; boards must forward it (or notice of its availability) to their investment advisors, ensure it is used only for the board's own Massachusetts public fund purposes, and review portfolios—including pooled funds assessed at the pool level—for compliance, consulting PERAC before divesting any non-compliant holdings.

Alerts retirement boards that PERAC conducted a simulated phishing security test against PROSPER users and announces upcoming mandatory cybersecurity awareness training for all PROSPER users not already receiving such training. Additional login security controls are under development; all users should ensure their devices have the latest security patches and up-to-date antivirus software.

Q3 2020 mandatory board member training memo listing exclusively virtual offerings due to COVID-19, including live webinars on retirement options, post-retirement employment, and the rescheduled Emerging Issues Forum keynote. The annual in-person Emerging Issues Forum was cancelled; the annual administrators' trainings are under evaluation with safety as a priority.

Releases the updated Application for Reinstatement to Service under G.L. c. 32, § 105, effective July 1, 2020 through June 30, 2021. Members reinstating from superannuation or termination retirement must work at least five years of full-time employment and may be required to repay significant amounts; boards should carefully counsel interested members before the member signs and converts from retiree to member-in-service status.

Supplements Memo #20/2020 to clarify that FFCRA Emergency Paid Sick Leave Act leave paid at 2/3 of regular pay (Reasons 4–6) also constitutes full creditable service and requires retirement deductions. The two-week leave period counts as full-time service; if it falls in a member's high-3 or high-5 years, the actual 2/3-rate pay received is used in the retirement allowance calculation.

Transmits the Q4 (October 2020) Tobacco Company List, updating the roster of companies prohibited from new investment under Chapter 119 of the Acts of 1997 (15% tobacco revenue threshold). This list supersedes all prior lists and is effective upon receipt; boards must forward it to investment advisors and PERAC will assess compliance during audits.

Q4 2020 mandatory board member training memo listing all-virtual offerings for October through December, including PERAC webinars on accidental disability remands, buyback calculations, and recent cases of interest. Notes that board members experiencing extenuating circumstances in meeting education requirements should consult Memo #15/2019; all sessions available through PROSPER.

Advises boards that PROSPER tasks will soon be issued for disability retirees who did not comply with the 2019 G.L. c. 32, § 91A filing requirement (annual earnings disclosure). Before terminating benefits, boards must provide written notice and a hearing opportunity; affected members retain the right to appeal any termination to the Contributory Retirement Appeal Board (CRAB).

Requests appropriation data from retirement boards by October 31, 2020, so PERAC can calculate the FY22 appropriation amounts for all governmental units under G.L. c. 32, §§ 22D, 22(6A)(b), or 22F. Boards are directed to submit via the online questionnaire on the PERAC website; hard copies are also accepted.

Initiates the 2019 G.L. c. 32, § 91A allowable earnings process for disability retirees who reported earnings that may trigger a benefit adjustment. Boards will receive PROSPER tasks to verify current salary and pension figures; if excess earnings are confirmed, PERAC issues an excess letter and the retiree's allowance is suspended until the overage is repaid.

Announces that beginning November 16, 2020, PROSPER will support electronic submission of benefit calculations, replacing paper submissions. Training webinars are scheduled for November 10 and 16; board staff with the disability role will automatically receive the new benefit calculation role, and additional staff can be granted access via the Individual Account Request Form.

Sets the supplemental dependent allowance for accidental disability retirees (G.L. c. 32, § 7(2)(a)(iii)) and accidental death survivors (§ 9(2)(d)(ii)) at $980.88 per eligible child annually, retroactive to July 1, 2020. The increase reflects the 3% COLA for State and Mass Teachers' Retirement Systems included in the FY21 budget signed December 11, 2020.

Chapter 227 of the Acts of 2020 (FY21 budget) extends the Chapter 53 waiver of G.L. c. 32, § 91 post-retirement work earnings and hours restrictions through calendar year 2021 for the duration of the Governor's State of Emergency. Disability retirees remain excluded; the waiver applies to any public-sector work during the emergency, not just COVID-related employment. PERAC will issue a memo when the State of Emergency ends.

Requests boards to review and update disability retiree records in PROSPER to reflect all 2020 changes — deaths, nursing home placements, allowance waivers, returns to active status, and address changes. Updates must be returned by January 18, 2021 to ensure accuracy before PERAC's February mailing of the 2020 § 91A Annual Statements of Earned Income.

Q1 2021 mandatory board member training memo (issued December 2020) listing all-virtual offerings for January–March 2021, including PERAC webinars on the legislative update, annual statement and cash books, and an administrator roundtable. Registration process changed — attendees must now register via website links rather than PROSPER; credits are updated by PERAC staff approximately one week after each live event.

Follow-up to Memo #11/2020 (Gomes/Plymouth decision) addressing three board questions: (1) detail pay counts toward the $5,000 annual compensation threshold; (2) the "same department" requirement applies only to firefighters, not police; (3) members ineligible for § 4(2)(b) service are not barred from purchasing prior service on a day-for-day basis under other provisions such as G.L. c. 32, § 3(5), depending on their employment status.

Transmits the Q1 2021 (January 2021) Tobacco Company List, updating the roster of companies prohibited from new investment under Chapter 119 of the Acts of 1997 (15% tobacco revenue threshold). Issued in December 2020; supersedes all prior lists and is effective upon receipt by retirement boards.

PERAC advises that the Commission has voted to continue the practice of allowing PERAC staff to approve up to $100.00 per case for non-invasive medical testing associated with the medical panel process for 2019. Per 840 CMR 10:10(3) and 10:15(4), medical panels may suggest non-invasive tests they deem necessary, with PERAC assuming the cost up to the annually-determined limit. Any test exceeding this amount requires advance Commission approval.

PERAC announces Q1 2019 mandatory training opportunities for retirement board members. Chapter 32 requires 18 credits over a board member's term and at least 3 credits per year; failure to meet either standard results in ineligibility to serve beyond that term. Q1 events include "Chapter 32 in a Nutshell" sessions in Somerville, Hingham, Billerica, and Springfield; "PROSPER Update" sessions in Somerville, Danvers, and via webinar; and Conflict of Interest seminars at the State Ethics Commission. Online training options from the Ethics Commission, Inspector General, NCTR, CFA Institute, and the National Crime Prevention Council are also available for 3 credits each.

PERAC notifies retirement boards that the Social Security Administration has announced a 2.8% Cost of Living Adjustment (COLA) for the prior year, based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Under G.L. c. 32, §103(c), any COLA granted by a retirement system effective July 1, 2019 may be up to 2.8%. Per §103(i), a board may elect to increase this to a maximum of 3.0% with proper legislative notice, but the process must be completed prior to June 30, 2019. Each board deciding whether or not to grant a COLA must notify PERAC within 30 days.

PERAC requests that retirement boards submit actuarial data for active members, retirees/survivors, and disability retirees as of December 31, 2018, by March 31, 2019, in the standard PERAC record format. Data should be submitted via the Interchange File Transfer website to PER-edoc-Actuary@per.state.ma.us. Boards scheduled for a 2019 PERAC actuarial valuation will have received a separate request. After submission, boards will receive data analysis reports to assist in reviewing and correcting any errors identified.

PERAC has set the regular interest rate for 2019 at 0.1% per G.L. c. 32, §22(6)(b), based on the average rates paid on individual savings accounts at a representative sample of at least 10 financial institutions. This rate applies to accumulated total deductions and accrued interest for refunds and retirements processed during calendar year 2019, and will also be credited on December 31, 2019 for outstanding balances as of December 31, 2018.

PERAC introduces four new general ledger accounts required for reporting 2019 activity: Account #5120 (Benefits — employer share of insurance/Medicare match for staff); Account #4701 (Carried Interest — investment general partner incentive fees); Account #4702 (Equalization Expense/true-ups — charges applied to later-joining partnership investors); and Account #4703 (Miscellaneous Investment Expenses — non-management-fee investment costs such as legal and audit). The three investment accounts close to #4820 Investment Income Control Account; Account #5120 closes to #3298 Expense Fund.

PERAC issues expanded administrative reminders covering asset management and a wide variety of retirement board activities. Key topics include: Section 23B contract expiration (April 2019 marks the seven-year term limit for many existing service provider relationships, requiring new searches); cash book submission requirements (complete packages including Trial Balances and Adjusting Journal Entries due within four weeks of month-end); monthly financial reporting to the board; vendor selection and RFP compliance under Section 23B; child support enforcement obligations before releasing accumulated deductions; management fee disclosure and accounting on Schedule 7; board meeting minutes requirements under the Open Meeting Law; executive session minutes handling; and the correct interest rate to use for refunds involving members who transferred from another system.

PERAC and the Department of Industrial Accidents (DIA) conduct an annual data match of the PERAC disability retiree database against the DIA database. Retirement boards will now receive their members' results from this match through PROSPER under Members/DIA. The report will be generated annually; boards without matches will not receive a report. Boards should follow up with their employer's Workers' Compensation Agent for any matched members whose workers' compensation status is unknown, to ensure that offsets required by G.L. c. 32, §14 are implemented promptly.

This memo transmits the updated April 2019 Tobacco Company List under Chapter 119 of the Acts of 1997, which prohibits new retirement system investments in companies deriving more than 15% of revenue from tobacco sales; the new list supersedes all prior versions effective immediately. Boards must share the list with their investment advisors (noting it's restricted to Massachusetts public fund use only), ensure portfolios—including pooled funds assessed at the entire-pool level—comply going forward, and, if non-compliant holdings are found, consult with PERAC before prudently divesting.

PERAC announces Q2 2019 mandatory training opportunities for retirement board members. Q2 events include PERAC webinars on Non-Investment Related Procurement (May 21), Post-Retirement Earnings (June 20), and Chapter 32 in a Nutshell (June 27); a State Ethics Commission Conflict of Interest seminar (May 30); the MACRS June Conference in Hyannis (June 1–5, up to 9 credits); and Attorney General Open Meeting Law trainings in Peabody, Avon, and Amherst. The 2019 PROSPER Update webinar from March 26 is now available for online viewing. Online training from the Ethics Commission, Inspector General, Attorney General, NCTR, and the National Crime Prevention Council remains available year-round.

PERAC provides an updated list of public employees who are no longer statutorily eligible to join a Chapter 32 retirement system, pursuant to G.L. c. 32, §15. Under that section, members charged with misappropriation of funds, convicted of offenses related to governmental funds, or convicted of certain enumerated crimes may lose their right to a retirement allowance and/or accumulated total deductions. Newly added individuals appear in bold on the attached list. Boards with any of the forfeited members still active in their system should contact Kim Boisvert at 617-666-4446, ext. 906 with the last four digits of the member's Social Security number for verification.

PERAC announces that Chapter 439 of the Acts of 2018, enacted January 10, 2019, amended G.L. c. 32, §20(7) to allow retirement board members to petition PERAC for a waiver of annual training credit requirements due to extenuating circumstances, provided they complete the required 18 total credits during their term. The Commission's Application for a Waiver of Education Restrictions form is enclosed and available on the PERAC website at the Compliance & Investments Forms page.

PERAC establishes a dedicated email address for monthly Cash Book submissions: percashbooks@per.state.ma.us. Boards that have already submitted 2019 Cash Books should not resubmit, but all remaining 2019 Cash Books should go to this address. PERAC reiterates that complete monthly Cash Book packages — including Year-to-Date Trial Balance, Monthly Cash Receipts, Monthly Cash Disbursements, Monthly Adjusting Journal Entries, and Monthly General Ledger — are due within four weeks of month-end. Timely submission is required for PERAC to perform monthly accounting/investment analysis and calculate each system's annual rate of return. All other communication with investment analysts Sarita Yee and Veronica Colon should continue via their individual email addresses.

This memo transmits the second quarterly Tobacco Company List for 2019 (dated July 2019), issued pursuant to Chapter 119 of the Acts of 1997, which prohibits Massachusetts retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco product sales. Boards are directed to forward the list to their investment advisors and are reminded that it supersedes all prior versions, effective upon receipt. PERAC will review board portfolios for compliance during audits, and any non-compliant board must divest holdings in a prudent manner after first consulting with PERAC.

PERAC announces a revised audit approach approved by the Commission on April 10, 2019, targeting high-risk areas and avoiding duplication with private audits. Following national trends, PERAC will tailor audits based on each system's risk level and will increasingly accept private audit work in lieu of segments of the PERAC audit — a practice authorized by law and regulation but previously underutilized. Risk factors include staff stability, prior audit findings, asset management practices, ongoing compliance, and timely filing of accounting information. Retirement boards are encouraged to retain private auditors for annual reviews. PERAC anticipates the revised approach will produce more frequent, targeted evaluations with less burden on boards.

PERAC announces Q3 2019 mandatory training opportunities for retirement board members. In-person and live events include an OIG "Know Your Responsibilities" session in Springfield (July 16), an AGO Open Meeting Law webinar (July 18), State Ethics Commission Conflict of Interest seminars (July 25, September 26), the PERAC Administrator's Training in Danvers (August 15), a PERAC webinar on Audit Process Revisions (August 28), the 15th Annual PERAC Emerging Issues Forum at Holy Cross College (September 12), and an in-person Audit session at PERAC offices (September 25). On-demand webinars from the Ethics Commission, Inspector General, Attorney General, NCTR, National Crime Prevention Council, and CFA Institute remain available for 3 credits each with PROSPER affidavit submission.

PERAC announces an updated Application for Reinstatement to Service from Superannuation/Termination Retirement Pursuant to G.L. c. 32 §105, effective July 1, 2019 through June 30, 2020. Because reinstating members may need to repay large amounts and must work at least five years of full-time employment (though not necessarily five years of creditable service), boards should carefully counsel interested members about requirements and benefits. Boards complete the first portion of the form and provide it to the member; upon signing, the member transitions from retiree status back to member-in-service status.

This memo transmits the third quarterly Tobacco Company List for 2019 (dated October 2019), issued pursuant to Chapter 119 of the Acts of 1997, which prohibits Massachusetts retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco product sales. Boards are directed to forward the list to their investment advisors and are reminded that it supersedes all prior versions, effective upon receipt. PERAC will review board portfolios for compliance during audits, and any non-compliant board must divest holdings in a prudent manner after first consulting with PERAC.

PERAC announces Q4 2019 mandatory training opportunities for retirement board members. Events include the MACRS October Conference in Springfield (September 29–October 2, up to 9 credits); AGO Open Meeting Law in-person sessions in East Longmeadow, Hanover, and Southborough; Administrator's Training sessions in Northampton (October 31) and Westborough (November 20); PERAC webinars on Cases of Interest (November 25) and Chapter 32 in a Nutshell (December 12); a Conflict of Interest seminar at the State Ethics Commission (December 5); and an in-person Cases of Interest session at PERAC offices (December 23). On-demand webinars previously recorded on Audit Process Revisions and the Annual Statement are also available on PERAC's website.

PERAC requests that retirement boards submit appropriation data by October 31, 2019, necessary to furnish governmental units with the amounts to be appropriated for FY21 under their funding schedules per G.L. c. 32, §22D, §22(6A)(b), or §22F. The questionnaire is available on the PERAC website and should be submitted electronically through the PERAC website; hard copy submissions are also accepted. Boards should contact John Boorack at 617-666-4446, ext. 935 with questions.

PERAC distributes new fraud prevention materials as part of its statutory obligation to maintain a toll-free hotline (1-800-445-3266) for reporting suspected fraudulent public pension claims. The 2019 campaign slogan is "Blow the Whistle on Pension Fraud." Each board receives three copies each of the poster, a brochure describing the PERAC Fraud Prevention Unit, and "Referral Report of Potential Fraud" forms. County and regional retirement systems will separately receive materials to distribute to local governmental units. Suspected pension fraud may also be reported by email at PensionFraud@per.state.ma.us or via the online form at mass.gov/forms/online-fraud-referral-form.

This memo requests that retirement boards review and update their disability retiree records in PROSPER by January 20, 2020, reflecting any address changes, deaths, nursing home placements, allowance waivers, or returns to active status that occurred during 2019. Updated data files should be returned to PERAC by email to SEKing@per.state.ma.us, fax, or mail, and boards must include the date of death and upload a death certificate or obituary in PROSPER when a member is deceased. The data must be accurate before PERAC mails the 2019 Annual Statements of Earned Income (91A) in February.

This memo publishes the 2018 federal compensation and benefit limits applicable to Massachusetts public retirement systems under Chapter 46 of the Acts of 2002. For 2018, the general compensation limit under IRC § 401(a)(17) is $275,000 and the general benefit limit under IRC § 415 is $220,000 per year for retirement at age 65 (reduced for earlier retirement). These limits are indexed annually and affect only the highest-paid employees.

This memo notifies retirement boards that the 2018 COLA under G.L. c. 32, § 103(c) is set at 2.0%, matching the Social Security Administration's CPI-W adjustment. Boards may elect to increase the COLA up to 3.0% by vote with proper legislative body notice before June 30, 2018. All boards must notify PERAC of their COLA decision within 30 days.

This memo transmits the first quarterly Tobacco Company List for 2018 (dated January 2018), issued pursuant to Chapter 119 of the Acts of 1997, which prohibits Massachusetts retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco product sales. Boards are directed to forward the list to their investment advisors and are reminded that it supersedes all prior versions, effective upon receipt. PERAC will review board portfolios for compliance during audits, and any non-compliant board must divest holdings in a prudent manner after first consulting with PERAC.

This memo outlines mandatory Q1 2018 training opportunities for retirement board members, reminding boards that Chapter 32 requires annual training and that failure to comply bars members from continued service. Scheduled sessions include Open Meeting Law and Conflict of Interest webinars, in-person Annual Statement and PERAC Memos sessions at multiple locations, and a range of approved online courses. Board members must register through PROSPER and submit Training Affidavits or certificates of completion to receive credit.

This memo notifies retirement board members that the NCPERS 2018 State and Federal Legislation webcast is available for three educational credits. Board members can access the recording at ncpers.org and must submit a PROSPER affidavit to receive credit.

This memo notifies boards that the Commission voted on November 8, 2017 to maintain the $100 per case cap for non-invasive medical testing associated with Regional Medical Panel examinations, consistent with prior years. Medical panels rarely order tests directly; most testing occurs during the member's evaluation and treatment phase and is reviewed by the panel.

This memo requests that all boards submit active member, retiree/survivor, and disability retiree data as of December 31, 2017 via the PERAC Interchange File Transfer system by March 31, 2018. After submission, boards will receive data analysis reports to review for errors; boards scheduled for a 2018 actuarial valuation should have already received a separate data request.

This memo covers several investment compliance reminders for retirement boards: contract relationships governed by § 23B must be re-bid before April 2019 (seven years from Chapter 176 of the Acts of 2011); boards must formally acknowledge SEC vendor disclosures at a board meeting with minutes reflecting the review; and accounting procedures for investment fees, carried interest, and ancillary expenses have been updated for 2018. Boards investing assets independently must submit annual reviews of investment objectives and asset allocation, including systems committed to PRIT or an OCIO strategy; RFP processes must not restrict entry to Massachusetts-only providers.

This memo alerts boards that the SJC affirmed CRAB's ruling that sick leave and vacation leave taken in conjunction with Workers' Compensation payments does not constitute regular compensation. Effective immediately, boards must direct all payroll officers to stop taking retirement deductions from supplemental sick leave and vacation leave payments made to members on Workers' Compensation. A more detailed follow-up memo was forthcoming.

This memo reminds boards that all board members and staff must comply with the 2009 Ethics Reform Law (Chapter 28 of the Acts of 2009), which requires annual distribution of the Conflict of Interest Law Summary and completion of the Ethics Commission's online training program every two years. Acknowledgements and completion certificates must be retained in board files for six years, and new members/employees must complete training within 30 days; completion of the online training also qualifies for three educational credits under the board member training requirement of G.L. c. 32, § 20(7).

This memo comprehensively clarifies when retirement boards must pay interest to members/beneficiaries and when members owe interest to boards, superseding portions of Memos #43/1999 and #29/2016. Key rules: boards pay interest at the "correction of errors" rate when an error reduces a benefit (per Herrick); boards do not pay interest on refunds of excess deductions that do not affect the pension amount (per Hollstein); members who were erroneously excluded from membership must now pay the "correction of errors" interest rate on service purchases (reversing prior PERAC guidance, following DALA/CRAB decisions); and members do not pay interest on under-withheld deductions. The memo also addresses Section 4(2)(b) refunds, the Needham Bill waiver provision (§ 20(5)(c)(3)), and includes a detailed scenario chart.

This memo transmits the second quarterly Tobacco Company List for 2018 (dated April 2018), issued pursuant to Chapter 119 of the Acts of 1997, which prohibits Massachusetts retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco product sales. Boards are directed to forward the list to their investment advisors and are reminded that it supersedes all prior versions, effective upon receipt. PERAC will review board portfolios for compliance during audits, and any non-compliant board must divest holdings in a prudent manner after first consulting with PERAC.

This memo outlines Q2 2018 mandatory training opportunities for retirement board members, covering sessions on Recent Cases of Interest and Open Meeting Law at locations including Middlesex Retirement Board, Reading Library, Leominster Public Library, PERAC offices, Springfield, Fairhaven, and Sudbury. Board members must register through PROSPER for PERAC-hosted sessions and must submit affidavits or certificates through PROSPER to receive credit.

This memo supersedes Memo #12/2018 and implements the SJC's Vernava decision (478 Mass. 832), which held that sick and vacation leave supplemental to Workers' Compensation is not "regular compensation" for determining the effective date of accidental disability retirement under G.L. c. 32, § 7. PERAC recommends payroll departments create a separate pay code for such supplemental payments and continue withholding deductions; if the member ultimately retires under § 7, those deductions must be refunded without interest. For already-retired members, recalculation is triggered only by a self-identification request from the retiree, and boards are cautioned that recalculation may be detrimental (not beneficial) in some cases.

This memo follows Memo #17/2018 on the Vernava SJC decision and reminds boards that PERAC memoranda are legally binding unless "manifestly unreasonable," citing Boston Retirement Board v. CRAB (2010) and Grimes v. Malden Retirement Board (2016). Boards that disagree with a PERAC directive may appeal but must comply in the meantime; PERAC will use its regulatory and statutory authority to enforce board compliance with the Vernava implementation approach developed with the Attorney General's Office.

This memo transmits the third quarterly Tobacco Company List for 2018 (dated July 2018), issued pursuant to Chapter 119 of the Acts of 1997, which prohibits Massachusetts retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco product sales. Boards are directed to forward the list to their investment advisors and are reminded that it supersedes all prior versions, effective upon receipt. PERAC will review board portfolios for compliance during audits, and any non-compliant board must divest holdings in a prudent manner after first consulting with PERAC.

This memo announces that the § 91A phase of PROSPER is now live, and boards will receive PROSPER tasks for any disability retirees who have not met the 2017 § 91A filing requirements. Before terminating a member's retirement allowance for failure to file, boards must provide written notice and an opportunity to be heard; boards must then record termination or no-action decisions in PROSPER, and the system will continue sending 30-day alerts until a response is entered.

This memo outlines Q3 2018 mandatory training sessions including How to be an Effective Board Member (Inspector General, Clark University), Conflict of Interest (Ethics Commission), a PERAC Administrators Meeting in Northampton, the Emerging Issues Forum at Holy Cross, a Vernava implementation session, and actuarial topics. Board members register through PROSPER for PERAC sessions and must submit affidavits or certificates to receive credit.

This memo alerts boards that investment side letter agreements increasingly contain provisions conflicting with Massachusetts Public Records Law (G.L. c. 4, § 7; c. 66). Boards are advised to include language in all side letters for limited partnerships, group trusts, and similar vehicles explicitly acknowledging that Public Records Law requirements supersede confidentiality provisions in the agreement. A sample side letter clause is provided.

This memo announces an updated PERAC form for reinstatement to service from superannuation or termination retirement under G.L. c. 32, § 105, effective July 1, 2018 through June 30, 2019. Boards must counsel interested members carefully, as reinstatement requires at least five years of full-time employment and potentially large repayments; boards complete the first portion of the form and upon the member's signature the individual reverts from retiree to member-in-service status.

This memo directs boards to complete 2017 § 91A salary verification tasks in PROSPER for all disability retirees whose earnings may require an allowance adjustment. Boards must enter each retiree's 2017 annual pension, annuity, and current salary; if PROSPER calculates excess earnings, PERAC sends the retiree an Excess Earnings letter and boards must notify the retiree and respond to the PROSPER task. Reminder tasks are sent every 30 days until the board responds.

This memo informs boards of the CRAB decision in O'Leary v. Lexington Retirement Board (CR-15-30), which rejected PERAC Memo #39/2012 and held that vacation buyback payments can never constitute regular compensation. Because both PERAC and the member have appealed to Superior Court, the CRAB decision is not final, and boards must continue evaluating vacation buyback plans under Memo #39 during the pendency of those appeals; no current allowances based on such payments should be recalculated in the interim. Payments for unused sick time remain excluded from regular compensation under Fair v. Middlesex County Retirement Board (2016).

This memo alerts boards to an active scam in which a fraudster impersonates a member to redirect their retirement allowance to a prepaid debit card account by submitting a direct deposit change with a routing number pointing to Green Dot Bank. PERAC is aware of one successful interception and two attempted ones, and urges boards to verify any direct deposit change requests directly with the member before processing.

This memo outlines Q4 2018 mandatory training sessions including the MACRS conference in Springfield, Open Meeting Law, Conflict of Interest, Administrators Meetings, and PERAC-hosted sessions on actuarial topics and "Chapter 32 in a Nutshell." Registration is through PROSPER for PERAC sessions and directly with organizations for AGO/Ethics Commission sessions; affidavits or certificates must be submitted through PROSPER to receive credit.

This memo transmits the fourth quarterly Tobacco Company List for 2018 (dated October 2018), issued pursuant to Chapter 119 of the Acts of 1997, which prohibits Massachusetts retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco product sales. Boards are directed to forward the list to their investment advisors and are reminded that it supersedes all prior versions, effective upon receipt. PERAC will review board portfolios for compliance during audits, and any non-compliant board must divest holdings in a prudent manner after first consulting with PERAC.

This memo requests boards to submit FY2020 appropriation data by October 31, 2018, needed for PERAC to calculate governmental unit appropriation amounts under G.L. c. 32, §§ 22D, 22(6A)(b), or 22F. The questionnaire is available on the PERAC website; electronic submission is strongly preferred.

This memo reminds all § 23B investment service providers that "compensation, in whatever form" must be disclosed annually and in RFP responses, including non-cash arrangements such as directed brokerage, conference sponsorships, charitable or political contributions made at investor request, and economic interests in general partnerships. PERAC flags recent filings showing law firm economic interests contingent on fund-raising success as examples of arrangements that must be fully disclosed.

This memo provides procurement guidance as boards approach the April 2019 contract re-bid deadline under § 23B. Key reminders: RFPs must not exclude qualified vendors through minimum Massachusetts client counts, asset thresholds, or other bid-tailoring requirements that limit competition; award points for such criteria rather than using them as pass/fail gates. Boards are also strongly advised to conduct in-person interviews with finalists, as case law (Unisys) shows that interviews are a critical shield against breach-of-fiduciary-duty claims when investments later fail.

This memo supersedes Memo #26/2018 and Memo #39/2012 in light of CRAB's November 6, 2018 partial stay in O'Leary v. Lexington Retirement Board. Under the partial stay: retirees who retired on or before November 6, 2018 are unaffected; active members must no longer have contributions withheld on unused vacation pay going forward (but no refunds of prior contributions pending judicial review); and members retiring on or after November 6, 2018 must have vacation buyback payments excluded from their benefit calculation, with any contributions taken on such payments refunded at retirement. PERAC confirms the Order applies to all 104 retirement boards, not just Lexington.

This memo transmits the Tobacco Company List dated January 2019 (issued December 14, 2018), pursuant to Chapter 119 of the Acts of 1997, which prohibits Massachusetts retirement systems from making new investments in companies deriving more than 15% of their revenue from tobacco product sales. Boards are directed to forward the list to their investment advisors and are reminded that it supersedes all prior versions, effective upon receipt. PERAC will review board portfolios for compliance during audits, and any non-compliant board must divest holdings in a prudent manner after first consulting with PERAC.

This memo requests that boards review and update their disability retiree records in PROSPER to reflect all 2018 status changes — deaths, nursing home placements, allowance waivers, returns to active status, and address changes — and return updated data to PERAC by January 25, 2019. Accurate records are required before PERAC mails 2018 Annual Statements of Earned Income (§ 91A) in February; death entries must include a date of death and uploaded obituary or death certificate.

This memo summarizes the major changes to Massachusetts public records law under Chapter 121 of the Acts of 2016, effective January 1, 2017, and advises retirement boards of their new obligations. Key requirements include designating a Records Access Officer (RAO), posting the RAO's contact information publicly, responding to records requests within 10 business days, and maintaining electronic copies of commonly requested records. PERAC notes it has sought an advisory opinion from the Secretary of State to clarify whether local, county, and regional retirement boards are classified as "agencies" or "municipalities" under the new law, and advises boards to comply with provisions applicable to all public entities in the interim.

This memo alerts retirement boards to two recent decisions—from CRAB and DALA—confirming that PERAC memoranda are legally binding on all retirement boards. The CRAB decision in Grimes v. Malden Ret. Bd. (2016) held that boards must follow PERAC directives issued under the Commission's statutory authority, and that a board's only recourse for disagreement is to appeal to CRAB under G.L. c. 32, § 16(4); boards may not simply ignore the directives. Boards should review their compliance with outstanding PERAC memoranda accordingly.

This memo notifies retirement boards that the Social Security Administration's 2017 Cost of Living Adjustment (COLA) is 0.3%, which is the maximum COLA boards may grant effective July 1, 2017 under G.L. c. 32, § 103(c). Boards may vote to grant a higher rate up to 3.0% with proper notice to the legislative body. Each board that makes a COLA decision must notify PERAC within 30 days.

This memo lists 1st quarter 2017 mandatory training opportunities for retirement board members to fulfill their annual education requirement under Chapter 32. PERAC-sponsored sessions cover the Annual Statement and the Grimes case at locations in Somerville, Taunton, Springfield, Middlesex, Danvers, and Worcester. Pre-approved credits are also available through State Ethics Commission seminars, Open Meeting Law webinars, and national organizations including NCPERS, NCTR, and the CFA Institute.

This memo requests that retirement boards submit actuarial data for active members, retirees/survivors, and disability retirees as of December 31, 2016 by March 31, 2017, using the standard PERAC record format via the Interchange File Transfer website. Boards will receive data analysis reports after submission to help identify and correct errors prior to actuarial valuations. Boards scheduled for a 2017 valuation by PERAC should have already received a separate data request.

This memo addresses the SJC decision in Retirement Board of Stoneham v. CRAB (December 22, 2016), which held that once a member is admitted to a retirement system, their membership continues as long as they remain employed regardless of subsequent changes in hours or pay. Boards that have erroneously removed members from membership must re-enroll them, deduct missing contributions, and allow payment on an installment plan. The memo also clarifies the interaction with the Under $5,000 Rule added by Chapter 21 of the Acts of 2009.

This memo clarifies the respective responsibilities of retirement boards and PERAC in handling Domestic Relations Orders (DROs). Effective July 1, 2017, PERAC will no longer routinely review DROs for compliance with Chapter 32 or calculate the initial allocation between Participant and Alternate Payee—these are board responsibilities. PERAC will still assist with complex or unusual cases upon specific request. Training sessions on DROs will be offered in the first half of 2017.

This interim memo advises boards to continue using the prior year's annuity savings account interest rate of 0.1% while PERAC awaits confirmation of the 2017 rate from the newly appointed Banking Commissioner. A separate memo will be issued once the official 2017 rate is determined.

This memo encourages retirement board administrators to attend PERAC's Annual Statement training sessions in early 2017, and covers several asset management reminders: the approaching April 2019 deadline for existing investment service contracts under Section 23B, the requirement to formally acknowledge annual vendor disclosures at board meetings with minutes reflecting the review, and the obligation to annually review and submit investment objectives and asset allocation plans whether invested directly, through PRIT, or via an OCIO strategy.

This memo announces training sessions for the first component of PROSPER, PERAC's new web-based communication system, focused on the Compliance Unit's application. Sessions for administrators and board members are scheduled at multiple locations including PERAC's Somerville office, Middlesex County Retirement Board, Springfield Retirement Board, and Plymouth County Retirement Board in March 2017. Board members who complete the training will receive three educational credits.

This memo warns retirement boards about an unsolicited investment event at Gillette Stadium sponsored by STS/LStar that some board members received invitations to attend. PERAC advises that retirement system assets cannot be directly invested in real estate, and that STS does not appear to be SEC-registered as required under PERAC's Placement Agent Policy. The memo also clarifies that MACRS did not sponsor or endorse the event.

This memo transmits the April 2017 Tobacco Company List, which replaces all prior versions and is effective immediately upon receipt. Under Chapter 119 of the Acts of 1997, retirement systems are prohibited from making new investments in companies that derive more than 15% of their revenue from tobacco products. Boards must forward the list to their investment advisors and PERAC will verify compliance through its audit process.

This memo lists 2nd quarter 2017 mandatory training opportunities for retirement board members, including sessions on Grimes and Other Cases of Interest, Domestic Relations Orders, Actuarial Assumptions, and the MACRS Annual Spring Conference in Hyannis (June 4–7, eligible for up to nine credits). Boards may also earn credits through the State Ethics Commission, Attorney General Open Meeting Law trainings, and approved online offerings from NCPC and the CFA Institute.

This memo transmits the July 2017 updated Tobacco Company List, which replaces all prior versions and is effective immediately upon receipt. Under Chapter 119 of the Acts of 1997, retirement systems may not make new investments in companies deriving more than 15% of their revenue from tobacco. Boards must forward the list to their investment advisors; PERAC will verify compliance during audits.

This memo announces that the PROSPER web-based communication system is fully operational with over 90% of board members and administrators registered, and provides key operational changes taking effect. Beginning June 19, 2017, the Disability Portal launches and disability applications must be submitted through PROSPER. Paper submissions for vendor procurements, annual eligibility pledge forms, and board member training registrations will no longer be accepted; all must be processed through PROSPER.

Following PERAC's January 2017 inquiry, the Supervisor of Public Records issued SPR Bulletin 01-17 classifying local, county, and regional retirement boards as 'municipalities' rather than state agencies under the updated Public Records Law (Chapter 121 of the Acts of 2016). As a result, effective July 1, 2017, boards' websites must identify the Records Access Officer (RAO) and the RAO's contact information, provide public records request guidelines, and post commonly requested documents to the extent feasible. The memo also notes that personal email addresses of public employees and their families are exempt from public disclosure.

This memo lists 3rd quarter 2017 mandatory training opportunities for retirement board members, including sessions on Actuarial Assumptions (August 24), the Thirteenth Annual Emerging Issues Forum at Holy Cross in Worcester (September 14), and Domestic Relations Orders (September 28). Online credits remain available through the State Ethics Commission conflict of interest training, Attorney General Open Meeting Law webinars, CFA Institute webcasts, and NCTR financial economics courses available on PERAC's website.

Effective September 5, 2017, all approved disabilities and death benefits submitted for PERAC's Legal Unit review under G.L. c. 32, §§ 21(1)(d) and 21(4) must be submitted exclusively via PROSPER through the 'Disability Transmittal' tab; paper and e-doc submissions will no longer be accepted after that date. Boards must ensure that all staff who need access to the Disability Portal are registered as PROSPER users.

This memo addresses concerns raised by retirement boards regarding MTRS requests for Section 3(8)(c) reimbursements for past member service, some of which are retroactive five years or more, as MTRS works through its processing backlog. PERAC reminds boards that these systems have benefited from investment use of the member funds during the interim period, and that such reimbursement requests do not affect the system's current appropriation. No specific action is required beyond continued cooperation with MTRS in fulfilling these reimbursement requests.

This memo responds to board inquiries about providing board counsel access to PROSPER, advising that this is currently not possible because PROSPER is coded only for retirement board employees and staff, not outside vendors. Until an alternative solution is developed, boards should have counsel review files before the Executive Director inputs information into PROSPER, and may use a HIPAA-compliant drop box for sharing medical records with counsel.

This memo announces an updated version of the PERAC Reinstatement to Service Application form under G.L. c. 32, § 105, effective July 1, 2017 through June 30, 2018. Boards should note that members electing reinstatement must repay all amounts owed and work at least five years of full-time employment; boards should counsel interested members carefully before processing the form, which transforms the member from retiree status back to member-in-service status upon signing.

This memo reminds retirement boards of their fiduciary obligations when selecting the board's Fifth Member and hiring board employees. Both processes must involve an open, competitive process with public posting, documented review, and interviews—regardless of whether an incumbent is seeking reappointment. Boards may not delegate the Fifth Member selection to selectmen, mayor, or city manager except as a last resort under the statutory tiebreaking process.

This memo reminds boards that investment service providers must file annual vendor disclosures with both the retirement board and PERAC under Section 23B of Chapter 32. Where a vendor has a relationship with a third party solicitor under SEC Rule 206(4)-3(b), the solicitor must also make disclosures directly to the board. Copies of all such disclosures must be submitted to PERAC via PROSPER as part of the Acknowledgement Process before any Acknowledgement Letter is issued.

This memo lists 4th quarter 2017 mandatory training opportunities for retirement board members, including MACRS fall conference sessions in Springfield (Legal Panel, RFPs/Veterans Buy Back/5th Member Selection), Board Administrator training sessions in Hyannis and Danvers, and PERAC-sponsored sessions on Investment Fees (November 16 and December 28). New Bedford retirement board members may attend three free sessions on Roberts Rules, Open Meeting Law, and Conflict of Interest Law sponsored by the City Solicitor's Office.

This memo requests that retirement boards complete and return the appropriation data questionnaire by October 31, 2017 so that PERAC can calculate FY19 appropriation amounts for all governmental units under G.L. c. 32, §§ 22D, 22(6A)(b), or 22F. Boards are encouraged to submit the questionnaire online via the PERAC website; questions should be directed to PERAC actuary Jim Lamenzo.

This memo transmits the October 2017 updated Tobacco Company List, which replaces all prior versions and is effective immediately upon receipt. Under Chapter 119 of the Acts of 1997, retirement systems may not make new investments in companies deriving more than 15% of their revenue from tobacco products. Boards must forward the list to their investment advisors; PERAC will verify compliance during its audit process.

This memo announces PERAC's 2017 fraud prevention campaign with the theme 'One Bad Apple Can Spoil the Whole Bunch,' reminding boards that PERAC maintains a confidential fraud hotline at 1-800-445-3266 and email at PensionFraud@per.state.ma.us. Boards will receive three posters, brochures, and Referral Report of Potential Fraud forms under separate cover, and should display materials prominently and use the forms to report suspected fraud to PERAC's Fraud Prevention Unit.

This memo notifies boards that the November 14, 2017 Administrator's Training originally scheduled at the Danvers Retirement Board has been relocated to the Double Tree by Hilton, 50 Ferncroft Road, Danvers, MA due to higher-than-expected enrollment. Board members who attend will receive three educational credits; registration is available through PROSPER or by email to Rose Morrison.

This memo provides a corrected list of public employees whose pension benefits have been forfeited as of July 2017, noting that one member (Steven Pereira) was incorrectly included on the prior list and should be removed. Boards with any forfeited member on the attached list who are active in their system should contact Kim Boisvert at PERAC with the last four digits of the member's Social Security number to verify the match.

This memo clarifies the specific documents boards must include when submitting calculations to PERAC for approval, organized by retirement type: Superannuation/Option D, Accidental Disability, Ordinary Disability, Accidental Death (active member), Accidental Death (retiree), and Section 101. Boards are asked not to include extra materials beyond what is listed, as unnecessary paperwork creates filing problems; additional documents will be requested only if needed after PERAC's initial review.

This memo informs retirement boards of PERAC Calculation Policy 15-001, developed internally in 2015 to address requests for G.L. c. 32, § 3(8)(c) reimbursement letters for members who retired many years ago. Due to a recent increase in such requests—some involving retirements over 30 years old—PERAC is distributing the policy to all boards. The policy and its application to specific cases should be directed to PERAC's Actuarial Unit.

This memo requests that boards review the attached list of their disability retirees and update PERAC's database with all status changes occurring in 2017, including death, nursing home placement, allowance waiver, return to active status, and address changes. Boards must also complete the New Member Data form for all accidental or ordinary disability retirees approved in 2017 and return all information by January 16, 2018, prior to PERAC's mailing of 2017 Annual Statements of Earned Income in February.

PERAC Memo #1/2016 announces the release of the 2014 Schedule 7 Fee Report, which for the first time compiles and publishes investment management, consultant, and custodian fees as reported by retirement boards in an easy-to-read format, alongside 2014 investment performance and asset data. The report reflects unaudited data as submitted (with noted gaps, including some boards omitting managers and Belmont's absent filing), and PERAC cautions that fee levels should be evaluated in context of investment performance rather than in isolation. No specific action is required of boards beyond awareness of the published data and ensuring the accuracy/completeness of their own future Schedule 7 filings.

PERAC Memo #2/2016 updates the IRS Chapter 46 (2002) compensation and benefit limits for 2016: the IRC §401(a)(17) compensation cap is $265,000, and the IRC §415 annual benefit limit is $210,000 for a member retiring at age 65 (reduced for earlier retirement ages). These limits, which are indexed annually, primarily affect higher-paid members; boards need only apply the updated figures when calculating benefits for affected members and may contact PERAC Actuary Jim Lamenzo with questions—no further action is required.

PERAC Memo #3/2016 establishes the 2016 cap on regular compensation for members who joined a retirement system after January 1, 2011, as required under Section 23 of Chapter 131 of the Acts of 2010. Since the 2016 IRS 401(a)(17) compensation limit is $265,000, the corresponding 64% limit under G.L. c. 32 is $169,600. Boards should apply this $169,600 cap when calculating regular compensation for affected members in 2016; no further action is required beyond ensuring compliance.

PERAC Memo #4/2016 announces that the Social Security Administration's CPI-W-based COLA for the year is 0.0%, meaning the base COLA retirement boards may grant under Chapter 32, §103(c), effective July 1, 2016, is also 0.0%. Boards retain discretion under §103(i) to vote at a duly called meeting to grant a higher COLA (up to 3.0%) with proper notice to their legislative body, but regardless of the decision made, each board must notify PERAC within 30 days of its determination.

This memo reminds retirement board members of the mandatory annual education requirement under Chapter 32, noting that failure to complete required training will render a member ineligible to continue serving. It lists pre-approved conferences and courses (e.g., NCPERS, NCTR, PRIM, GFOA, State Ethics Commission seminars) that qualify for credit, with specified credit values, and clarifies that affidavits are acceptable proof of attendance for approved online courses. Boards should ensure members track and complete required training hours using these pre-approved sources, and should seek pre-approval well in advance for any other conference sessions for which credit is sought.

**PERAC Memo #6/2016** reminds retirement boards that Board members and staff are considered public employees under G.L. c. 268A and must comply with the 2009 Ethics Reform Law's mandatory education and training requirements, including certain private contractors performing designated personal services. Boards must ensure all covered individuals receive the Ethics Commission's Summary of the Conflict of Interest Law annually (within 30 days for new members/staff, with signed acknowledgments retained on file), and complete the online ethics training every two years (within 30 days for new members/staff), retaining completion certificates for six years. Boards should also forward copies of acknowledgments and certificates to the appropriate appointing authority for non-elected members.

PERAC Memo #7/2016 establishes the "regular interest" rate under G.L. c. 32, §22(6)(b) at 0.1% for calendar year 2016, based on average savings account rates from a sample of financial institutions. Boards must apply this 0.1% rate to accumulated total deductions and accrued interest when crediting interest on refunds and retirements processed during 2016, and also apply it to outstanding balances as of December 31, 2015 when crediting interest on December 31, 2016. No further action beyond correct application of this rate is required.

PERAC Memo #8/2016 requests that all retirement boards submit actuarial data (active members, retirees/survivors, and disability retirees) as of December 31, 2015, in standard PERAC format, preferably via the Interchange File Transfer website, by March 31, 2016. Boards should review the resulting data analysis reports for errors or warnings and correct any issues to ensure reliable, timely actuarial valuations; boards already scheduled for a 2016 PERAC valuation should follow the separate data request they previously received.

PERAC Memo #9/2016 transmits the updated 2016 buyback/make-up repayment worksheets and cumulative interest factor sheets for calculating service purchases under the various G.L. c. 32 provisions referenced in Memos #13/2005 and #28/2008. It clarifies that buybacks under §§4(1)(g½), 4(1)(l), 4(1)(l½), 4(1)(l¾), 4(1)(n), 4(1)(n½), 4(1)(p), 4(1)(r), 4(1)(s), and 4(2)(c) must use buyback interest only, while those under §§3(3), 3(4), 3(4A), 3(5), 3(6)(c), 3(6)(d), and 3(8)(b) may use either buyback or actuarial interest per Chapter 176 of the Acts of 2011 (see Memo #23/2012). Boards should begin using the new 2016 worksheets—selecting the correct version based on interest type and applicable investment return assumption—for all relevant buyback/make-up calculations going forward.

PERAC Memo #10/2016 announces the distribution of updated (as of July 1, 2015) printed retirement guides—covering the Public Employee Retirement Guide, Survivor Benefits Guide, and Disability Retirement Guide—to all 104 retirement boards based on membership size. No action is required of boards beyond distributing/making these guides available to members; additional copies can be obtained free online, purchased at PERAC's office, or ordered by mail through the printer.

PERAC Memo #11/2016 transmits the updated Tobacco Company List (dated April 2016), which supersedes all prior versions, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must apply this list—including to pooled fund holdings assessed in aggregate—when reviewing new investments, forward it to their investment advisors (for Massachusetts public fund use only), and, if any post-1998 non-compliant holdings are found during a PERAC audit, consult with PERAC before divesting in a prudent manner.

This memo summarizes revisions to the retirement board election regulations (840 CMR 7.00), effective March 11, 2016, which update terminology (e.g., defining "member in service," "member inactive," and "retiree"), clarify voting/eligibility rules (inactive members may vote but not serve; board staff cannot be elected to their own board absent grandfathering), and revise notice requirements—including a 90-day notice deadline with an exception process, mandatory copying of PERAC on election notices, and provisions for future use of electronic notification. Boards should review the attached full regulation text and their election procedures for compliance, particularly regarding notice timing/content and eligibility rules, and must contact PERAC in writing if seeking an exception to the 90-day notice requirement or if planning to use electronic notification methods.

PERAC Memo #13/2016 announces amendments to the disability retirement regulations (840 CMR 10.00), effective March 11, 2016, updating them to reflect legislative changes and clarify recurring issues. Key substantive changes include: expediting applications for members not receiving Workers' Comp/Line of Duty benefits; clarifying that the Employer (not the department head) is a party to applications; restricting who may attend medical panel exams and requiring boards (not members) to submit medical records to the panel; requiring clarification requests to medical panels be routed through PERAC with a mandatory 60-day panel response time; and granting hearing officers discretion to limit attendance in emotional disability (e.g., PTSD) cases. Boards should review and update their internal disability application, medical panel, and hearing procedures to ensure compliance with these revised regulations.

This memo reminds retirement boards of the mandatory annual education requirement for board members under Chapter 32, noting that members who fail to meet this requirement become ineligible to serve out their terms. It clarifies credit policies (e.g., affidavits accepted for online courses, no repeat credit within 12 months) and lists pre-approved third-party programs—such as NCPERS, NCTR, PRIM, and various ethics/open meeting law trainings—that qualify for education credits. Boards should ensure members are tracking and completing required training and should be aware that credit for non-listed events must be pre-approved by PERAC well in advance.

This memo reinforces amended 840 CMR 10.13(1)(a), which requires all voting board members—regardless of how they voted—to sign disability retirement transmittals (accidental/ordinary disability and accidental death) sent to PERAC. PERAC granted a grace period, processing applications without full signatures through April 29, 2016, but boards must ensure all voting members sign transmittals for applications submitted on or after May 2, 2016, or the application will be remanded.

PERAC Memo #16/2016 explains Chapter 77 of the Acts of 2016, effective for benefits granted on or after July 1, 2016, which addresses situations where a member has an ex-spouse designated as Option C beneficiary under a QDRO but later remarries and dies from the condition underlying an accidental disability retirement (or, for firefighters, from cancer discovered within 5 years of retirement). The law requires that the Option C benefit be paid to the former spouse, with any remaining difference between the Section 9 accidental death benefit and the Option C benefit paid to the current spouse; if the former spouse predeceases the current spouse, the full Section 9 benefit reverts to the current spouse. Boards must apply this calculation method when processing Section 9 claims involving a DRO-designated Option C beneficiary and a surviving current spouse, ensuring benefits are properly split and administered under these limited circumstances.

This memo transmits PERAC's updated Tobacco Company List (dated July 2016), which replaces all prior versions and identifies companies from which retirement boards are prohibited from making new investments under Chapter 119 of the Acts of 1997 (the 15%-tobacco-revenue rule). Boards must forward the list to their investment advisors (or direct them to it on the PERAC website), noting the list is for Massachusetts public fund use only, and must ensure their portfolios—including pooled funds assessed at the pool level—remain in compliance, consulting PERAC before divesting if a violation is found during audit.

This memo (PERAC Memo #18/2016) reminds retirement board members of the statutory requirement to complete mandatory annual training under Chapter 32, warning that failure to do so will disqualify a member from continuing to serve for the remainder of their term. It lists upcoming Q3 2016 training opportunities (in-person sessions, webinars, and online courses) along with registration details, and outlines PERAC's pre-approved list of external programs eligible for education credits. Boards should ensure members register for and complete sufficient training sessions to maintain compliance and eligibility for continued board service.

PERAC Memo #19/2016 announces the updated annual supplemental dependent allowance of $871.56 per eligible child, effective July 1, 2016, applicable under G.L. c. 32 §§ 7(2)(a)(iii), 22D, and 9(2)(d)(ii). Boards that have accepted these provisions must begin paying this increased annual amount to eligible dependent children of accidental disability retirees and accidental death survivors as of that date. No further board action is needed beyond implementing the new payment amount for qualifying beneficiaries.

PERAC Memo #20/2016 announces an updated Application for Reinstatement to Service form under G.L. c. 32 §105, effective July 1, 2016 through June 30, 2017, for retirees seeking to return to active membership. Boards must use this revised form, complete the initial portion for interested members, and carefully counsel them on the repayment obligations and five-year full-time employment requirement before they sign and convert from retiree to member-in-service status. Boards should contact PERAC's actuarial unit if a needed investment return assumption factor is not listed on the form.

PERAC Memo #21/2016 asks retirement boards to review the attached list of their supplemental regulations currently posted on PERAC's website (excluding investment and travel regulations) to ensure it is accurate and up to date. Boards must confirm the list is correct, or submit documentation for any approved regulations missing from the list, so PERAC can maintain only currently active regulations online. Responses were due to Doreen Duane by September 16, 2016.

PERAC Memo #22/2016 addresses forfeiture of retirement allowances under G.L. c. 32, §15 for members convicted of misappropriation or related offenses, noting the varying effective dates and requirements of the statute's subsections. It transmits a partial list, compiled from DA/AG notifications, of public employees potentially subject to forfeiture. Boards must review the attached list, report any updates, discrepancies, or additions, and submit copies of all relevant investigation/hearing/decision documents since October 2002 to Kim Boisvert by September 30, 2016.

PERAC Memo #23/2016 transmits the updated October 2016 Tobacco Company List, which supersedes all prior lists and identifies companies deriving over 15% of revenue from tobacco sales, in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must share this list with their investment advisors (noting it is restricted to Massachusetts public fund use only) and ensure no new prohibited investments—including in noncompliant pooled funds—are made; any board found out of compliance during a PERAC audit must consult with PERAC before divesting to correct the portfolio.

This memo lists Q4 2016 mandatory training opportunities for retirement board members (MACRS sessions, PERAC-hosted disability process and board responsibilities trainings, OML sessions, and various webinars/online options), and reiterates PERAC's pre-approval process and list of pre-approved third-party programs eligible for education credit. Boards should note that members who fail to meet the annual training mandate become ineligible to continue serving for the remainder of their term, so administrators should ensure members register for and complete qualifying sessions before year-end.

PERAC Memo #25/2016 announces its first statutorily required (Ch. 68 of Acts of 2011, §57) summary report on Other Post-Employment Benefits (OPEB), compiling data from nearly 450 Commonwealth, municipal, and district plans based on the most recent valuation reports received by PERAC as of August 1, 2016. Boards should review the report and its footnotes—which are integral to interpreting the data—available on PERAC's website, and note that some entities' data may not reflect their most current valuation if it was not submitted to PERAC; no other action is required, and similar reports are expected roughly every five years.

PERAC Memo #26/2016 requests that retirement boards submit the annual Appropriation Data Questionnaire—needed to calculate FY18 required appropriations under G.L. c.32, §22D, §22(6A)(b), or §22F—by October 31, 2016, preferably via PERAC's website. Boards must complete and return this questionnaire, and should also confirm their funding schedule has been submitted to PERAC for approval within the past two years, contacting PERAC if an update is needed.

PERAC Memo #27/2016 transmits the updated Tobacco Company List (dated January 2017), which supersedes all prior lists, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must apply this list immediately upon receipt—including to pooled funds evaluated on an entire-pool basis—and should distribute it to their investment advisors (for Massachusetts public fund use only), ensuring no new prohibited investments are made; any existing non-compliant holdings identified through PERAC's audit process must be divested prudently after consultation with PERAC.

PERAC Memo #28/2016 requests that retirement boards review and update disability retiree records (deaths, nursing home confinement, waivers, returns to active status, address changes) to maintain an accurate database used for enforcing post-retirement earnings limits and issuing the 2016 Annual Statement of Earned Income (91A) mailing. Boards must also complete the "New Member Data" form for any 2016 accidental or ordinary disability retirees and return all updated information to PERAC no later than **January 16, 2017**.

This memo (superseding Memos #22/2013, #33/2013, and #19/2014) updates guidance on crediting/buying back call firefighter service under G.L. c. 32, §4(2)(b), incorporating two new CRAB decisions (Grimes v. Malden and Gomes v. Plymouth) on buyback methodology; it clarifies that reserve/permanent-intermittent police officers and firefighters are treated the same as call firefighters. Boards must apply the revised calculation method going forward—crediting up to 5 years at no cost for uncompensated call service, and requiring payment of contributions (plus buyback interest) at the historical rate for any compensated service—when processing buybacks for members who transition from call to permanent firefighter status.

PERAC Memo #30/2016 addresses the annual review, required under 840 CMR 10:10(3) and 10:15(4), of the maximum amount PERAC will reimburse for non-invasive medical tests suggested by Regional Medical Panels during disability retirement evaluations. At its December 14, 2016 meeting, the Commission voted to maintain the existing cap, authorizing PERAC staff to approve up to $100.00 per case for such testing. No action is required of retirement boards; this is informational, confirming the reimbursement threshold remains unchanged.

PERAC Memo #1/2015 provides the annual IRC compensation and benefit limits under Chapter 46 of the Acts of 2002 for calendar year 2015: a $265,000 compensation cap (Section 401(a)(17)) and a $210,000 benefit cap at age 65 (Section 415), with the benefit limit reduced for retirement before age 62. These limits primarily affect only the highest-paid members, and boards should apply them when calculating retirement allowances for affected members, contacting PERAC's Actuary Jim Lamenzo with questions—no other action is required.

PERAC Memo #2/2015 sets the 2015 cap on regular compensation for members who joined a retirement system after January 1, 2011, at $169,600—64% of the IRS Section 401(a)(17) limit of $265,000 for that year. Boards must apply this figure when calculating regular compensation for affected members and should ensure payroll/compensation reporting for these members does not exceed this cap. No further action beyond application of the limit is required; questions can be directed to PERAC's Actuary, Jim Lamenzo.

PERAC Memo #3/2015 reports that the Social Security Administration's announced CPI-W increase is 1.7%, which sets the statutory COLA rate under Chapter 32, §103(c) effective July 1, 2015. Retirement boards may vote at a duly called meeting to grant this base COLA or, with proper notice to their legislative body, elect a higher rate up to 3.0% under §103(i). Each board must notify PERAC of its COLA decision within 30 days of voting.

PERAC Memo #4/2015 notifies boards that the State Ethics Commission's monthly conflict-of-interest law seminars (in-person at their Boston office or via webinar) qualify for three PERAC educational credits when attended by board members. Dates through April 2015 are listed, and registration is required in advance by phone (in-person) or by contacting Carolyn Teehan (webinar). No board action is required beyond optional registration for members seeking to attend and earn credits.

PERAC Memo #5/2015 announces that, per G.L. c. 32, §22(6)(b), the "regular interest" rate for member deductions in calendar year 2015 has been set at 0.1%, based on average savings rates from a sample of financial institutions. Boards must apply this rate to accumulated total deductions and accrued interest when crediting interest for 2015 refunds and retirements, and also credit it on outstanding balances as of December 31, 2014, on December 31, 2015.

PERAC Memo #6/2015 transmits the updated buyback/make-up repayment worksheets and cumulative interest factor sheets for calendar year 2015, to be used for calculations under the various G.L. c. 32 sections referenced in prior memos. Boards should note that buybacks/make-ups under §§4(1)(g½), 4(1)(l)-(s), and 4(2)(c) must use buyback interest exclusively, while those under §§3(3)-3(8)(b) may use either buyback or actuarial interest per Chapter 176 of the Acts of 2011 (see Memo #23/2012 for guidance on rate selection). Boards should replace prior-year worksheets with the enclosed 2015 versions when performing these calculations going forward.

PERAC Memo #7/2015 requests that all retirement boards submit active member, retiree/survivor, and disability retiree data as of December 31, 2014, in standard PERAC record format by March 31, 2015. Boards should submit this data promptly so PERAC can generate analysis reports identifying errors or discrepancies to correct, supporting accurate and timely actuarial valuations; boards already scheduled for a 2015 PERAC valuation should have received a separate data request.

**PERAC Memo #8/2015 – Remarriage Penalty** This memo revises PERAC's prior guidance (Memo #34/2000) on the elimination of the "remarriage penalty" in light of the Superior Court's 2014 decision in *Boston Retirement Board v. CRAB and Edith Carell*, which held that the repeal of the remarriage penalty (effective July 1, 2000) applies even to beneficiaries whose survivor benefits were terminated due to remarriage *before* that date. Boards must now recognize that eligible surviving spouses who remarried prior to July 1, 2000 may reapply and, if approved, receive benefits prospectively from the date of reapplication (not retroactively to the remarriage date), and boards should reassess any such prior denials or terminations accordingly.

PERAC Memo #9/2015 transmits the updated (April 2015) Tobacco Company List, superseding all prior versions, which identifies companies deriving more than 15% of revenue from tobacco sales and therefore prohibited from new investment under Chapter 119 of the Acts of 1997. Boards must forward or make this list available to their investment advisors (for Massachusetts public fund use only), ensure new purchases comply with the list—including for pooled funds assessed on an entire-pool basis—and, if a portfolio is found non-compliant during a PERAC audit, consult with PERAC before undertaking any prudent divestiture.

PERAC Memo #10/2015 reminds retirement board members of the mandatory annual Chapter 32 training requirement, noting that failure to meet the mandate renders a member ineligible to continue serving beyond their current term. It lists pre-approved courses and sponsoring organizations (e.g., NCPERS, NCTR, PRIM, GFOA, State Ethics Commission seminars) eligible for education credit, clarifies that affidavits may substitute for attendance proof at approved online courses, and states that credit for conference-embedded sessions (e.g., ethics or open meeting law segments) requires PERAC pre-approval well in advance of the event. Boards should ensure members are aware of and pursuing sufficient approved training to remain compliant and eligible to serve.

This memo announces that, under Chapter 492 of the Acts of 2014, disability retirees may now earn an additional $15,000 per calendar year (from any public or private source) above the standard earnings cap—the difference between the current salary of the position from which they retired and their retirement allowance—effective for calendar year 2015 and reflected on the 2015 Annual Statement of Earned Income filed in 2016. Note that the 960-hour public-sector work limit remains unchanged. Boards should use the attached (interactive, web-based) Earned Income Worksheet to help disability retirees calculate their allowable annual earnings under the new limit.

PERAC Memo #12/2015 addresses CRAB's amended decision in Zavaglia v. Gloucester/Salem Retirement Boards, which clarifies when inactive members may purchase prior creditable service. While service purchases generally require active membership, CRAB identified specific statutory exceptions—including G.L. c. 32 §§3(4), 3(4A), 4(1)(q), 4(1)(r), and 3(6)(d)—covering teachers on leave, certain veterans' organization service, Peace Corps volunteers, and members reinstated after separation. Although the decision technically binds only the parties involved, PERAC recommends boards follow these guidelines for consistency when evaluating buyback requests from inactive members; no immediate mandatory action is required, but boards should apply this framework going forward.

PERAC Memo #13/2015 transmits the updated Tobacco Company List (July 2015), which replaces all prior versions and identifies companies deriving more than 15% of revenue from tobacco sales—investments in which are prohibited under Chapter 119 of the Acts of 1997. Boards must ensure this list is provided to their investment advisors (for Massachusetts public fund use only) and must review portfolios, including pooled funds, for compliance; any non-compliant holdings must be divested prudently, in consultation with PERAC prior to taking action.

PERAC Memo #14/2015 reminds retirement boards of the statutory (Chapter 32) mandate that board members complete annual training, warning that non-compliance disqualifies members from continuing to serve beyond their current term. It lists pre-approved training programs and sponsors (e.g., NCPERS, NCTR, IFEBP, PRIM, State Ethics Commission, GFOA) eligible for credit, and notes that online course affidavits are accepted as proof of attendance, but credit is not given for repeating the same online course within 12 months. Action required: Boards should ensure members track and complete required training credits each year and use only pre-approved courses/sponsors (or seek advance approval for other programs) to ensure credits count toward the mandate.

This memo reminds boards of their obligation under PERAC Regulation 4.03 to submit monthly cash book entries, trial balances, journal entries, and custodian/fund statements to PERAC within four weeks of month's end, in accurate and timely fashion. It cites an incident where one board's inaccurate/late financial data submission caused the 2014 Annual Report to be incomplete, and warns that repeated noncompliance will trigger remedial action by the Commission. Boards should ensure timely, accurate monthly filings and follow proper procedures (referenced in prior memos) when correcting or revising previously submitted Cash Books or Annual Statements.

PERAC Memo #16/2015 announces the updated annual supplemental dependent allowance—$846.12 per eligible child effective July 1, 2015—payable under G.L. c. 32 §7(2)(a)(iii) (including systems that accepted §22D) and under §9(2)(d)(ii) for additional pensions for dependent children. Boards that have accepted these provisions must apply this new COLA-adjusted amount to eligible accidental disability retirees and accidental death survivors beginning with that date; no further action is needed for boards that have not accepted these provisions.

PERAC Memo #17/2015 announces an updated version (effective July 1, 2015–June 30, 2016) of the Application for Reinstatement to Service from Superannuation/Termination Retirement under G.L. c. 32 §105. Boards must use this revised form when counseling members interested in reinstatement—completing the board's portion and ensuring members understand the repayment obligations and five-year full-time employment requirement before signing, which converts them from retiree to member-in-service status. Boards should contact PERAC's actuarial unit if their plan's investment return assumption isn't among the factors listed on the form.

PERAC Memo #18/2015 notifies boards that Section 54 of Chapter 46 of the Acts of 2015 amends G.L. c. 32, §23B by extending the maximum permissible contract term (including renewals, extensions, and options) for investment, actuarial, legal, and accounting service contracts from five years to seven years, effective immediately. Boards should review existing contracts: those with terms of five years or fewer may run to completion, but any extension may not push the total term beyond seven years, and boards should apply the new seven-year cap going forward when procuring or renewing covered service contracts.

PERAC Memo #19/2015 announces proposed amendments to 840 CMR 10.00 (Disability Retirement process) and 840 CMR 7.00 (Retirement Board Election process), with public hearings scheduled between September 21 and October 8, 2015, and a comment deadline of October 9, 2015. Boards should review the enclosed draft regulations, may attend a hearing or submit written comments by the deadline, and can request copies of the drafts from PERAC if needed—no other immediate action is required.

This memo transmits PERAC's updated Tobacco Company List (October 2015), which replaces all prior lists and identifies companies deriving more than 15% of revenue from tobacco sales, in accordance with Chapter 119 of the Acts of 1997 prohibiting new retirement system investments in such companies. Boards must forward the list to their investment advisors (noting it is restricted to Massachusetts public fund use only), ensure no new prohibited investments are made, and—if a portfolio audit reveals noncompliance, including in pooled funds meeting the 15% threshold—consult with PERAC before divesting in a prudent manner.

PERAC Memo #21/2015 reminds retirement boards that all board members must complete mandatory annual training under Chapter 32, warning that failure to meet this requirement will disqualify a member from continuing to serve once their current term ends. It lists pre-approved courses and sponsoring organizations (e.g., NCPERS, NCTR, IFEBP, PRIM, GFOA, State Ethics Commission) eligible for credit, notes that affidavits are accepted as proof of attendance for certain online courses, and clarifies that repeat online courses within 12 months do not earn credit. Boards should ensure members are aware of and tracking their training compliance, and should seek PERAC pre-approval well in advance for any non-listed conference sessions seeking credit.

PERAC Memo #22/2015 requests that all retirement boards complete and return the annual appropriation questionnaire—needed to calculate FY17 governmental unit appropriation amounts under G.L. c.32, §22D, §22(6A)(b), or §22F—by October 31, 2015, preferably via PERAC's website. Boards should also confirm that they have submitted a funding schedule for PERAC approval within the past two years, as required, and contact PERAC if an updated schedule is needed.

PERAC Memo #23/2015 announces the 2015 fraud prevention poster campaign, "Stop Pension Fraud. It is not a Game," which promotes PERAC's fraud reporting hotline and email address, and encloses posters, brochures, and "Referral Report of Potential Fraud" forms. Boards should display the enclosed posters and brochures prominently in their offices and make the referral forms available to staff and the public for reporting suspected pension fraud, contacting PERAC's Communications Director for additional copies if needed.

PERAC Memo #24/2015 announces that PERAC, working with Collaborative Consulting, is surveying retirement boards to gather input for its Technology Improvement Project aimed at reducing costs and enhancing system capabilities. Boards are asked to have Board Members and Administrators complete the brief online survey (link provided) by Friday, November 6, 2015, to help prioritize improvement areas. No other action is required beyond survey completion by the deadline.

This memo transmits PERAC's updated Tobacco Company List (dated January 2016), which replaces all prior versions and takes effect immediately upon receipt, identifying companies deriving over 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must share the list with their investment advisors (noting it is restricted to Massachusetts public fund use only), ensure their portfolios—including pooled funds assessed at the pool level—comply with the divestment requirement, and consult with PERAC before taking any divestment action if non-compliance is found during audit.

PERAC Memo #26/2015 asks retirement boards to review and update PERAC's disability retiree database, reporting any 2015 status changes (death, nursing home confinement, waived allowance, return to active status, or address changes) and noting which retirees are exempt from filing the Annual Statement of Earned Income (91A) under Chapter 176 of the Acts of 2011. Boards must also complete the "New Member Data" form for all new accidental or ordinary disability retirees approved in 2015, or for any members missing from the provided list. All updates and forms are due to PERAC by January 13, 2016, to ensure accuracy before the 2015 91A statements are mailed in February.

PERAC Memo #27/2015 supplements prior guidance (notably Memo #54/2012 and Memo #18/2014) on completing Annual Vendor Disclosure forms required under G.L. c. 32, §23B, clarifying that sub-advisors/investing managers must file disclosures (or the fund-of-funds/manager-of-managers cannot allocate assets to them), and that "Compensation Paid" and "Compensation Received" sections must specifically identify recipients and fully disclose all forms of compensation (e.g., carried interest, transaction/monitoring/financing/redemption fees), not just generic categories. Boards should ensure their investment providers are aware of and comply with these detailed disclosure expectations when reviewing and accepting Annual Disclosure filings.

This memo provides the annual updated federal limits under Chapter 46 of the Acts of 2002 for 2014: the IRC Section 401(a)(17) compensation limit is $260,000, and the IRC Section 415 benefit limit is $210,000 (for retirement at age 65, reduced for earlier retirement). These limits affect only the system's highest-paid members and require no action by boards beyond applying them when calculating compensation and benefits for affected members; questions should be directed to PERAC's Actuary, Jim Lamenzo.

PERAC Memorandum #02/2014 notifies boards that, for calendar year 2014, the regular compensation limit under Chapter 131 of the Acts of 2010 (applicable to members who joined a retirement system after January 1, 2011) is $166,400—64% of the IRS 401(a)(17) limit of $260,000. Boards must apply this cap when calculating regular compensation for these post-2011 members; no other action is required beyond ensuring payroll/compensation reporting reflects this limit.

PERAC Memorandum #03/2014 notifies retirement boards that the Social Security Administration's announced COLA is 1.5%, which sets the base COLA rate effective July 1, 2014 under Chapter 32, §103(c). Boards may vote at a duly called meeting to increase this rate up to 3.0% under §103(i), provided proper notice is given to the appropriate legislative body; regardless of the decision made, each board must notify PERAC of its COLA determination within 30 days.

This memo transmits the updated 2014 buyback/make-up calculation worksheets and cumulative interest factor sheets for use with the various buyback and make-up provisions under G.L. c. 32. Boards should use these worksheets going forward for all applicable calculations, applying buyback interest exclusively for the §4(1) provisions listed, while §3 provisions remain subject to the dual buyback/actuarial interest rules under Chapter 176 of the Acts of 2011 (per Memo #23/2012). No further action is required beyond adopting the new worksheets for 2014 calculations.

PERAC Memo #05/2014 clarifies when retirement boards must begin applying a new buyback interest rate (defined as half the actuarial assumed investment return rate) after a system's actuarial valuation changes its investment return assumption. Boards should apply the new rate—based on the valuation report—starting January 1 of the year following the report's issuance, ensuring uniform application across systems. Boards must review their most recent valuation report's issue date and update buyback/make-up interest calculations accordingly for applications received on or after that following January 1.

This memo announces preparation of the 2013 Annual Statement, due to PERAC signed and completed by May 1, 2014, with pre-closing December 2013 cashbook and trial balance due by March 3, 2014. It notes Annual Statement materials (including Schedule 7 on investment fee disclosure) are available on PERAC's website or by request, and offers optional training classes on completing the Annual Statement/Schedule 7 (which also count toward board members' 3-hour annual education requirement). Boards must ensure timely submission of both the trial balance/cashbook and the completed Annual Statement, and may register for training via Rose Cipriani if desired.

PERAC Memo #07/2014 transmits the updated (January 2014) Tobacco Company List required under Chapter 119 of the Acts of 1997, which bars retirement systems from making new investments in companies deriving more than 15% of revenue from tobacco sales. Boards must replace any prior list with this version, distribute it to their investment advisors (for Massachusetts public fund use only), and ensure portfolio compliance—applying the 15% threshold at the pooled-fund level where applicable—consulting PERAC before divesting if non-compliance is found.

PERAC Memorandum #08, 2014 sets the "regular interest" rate under G.L. c. 32, §22(6)(b) at 0.1% for calendar year 2014, based on average savings account rates from a sample of financial institutions. Boards must apply this 0.1% rate to accumulated total deductions and accrued interest when crediting interest for refunds and retirements processed during 2014, and also apply it on December 31, 2014 to outstanding balances as of December 31, 2013.

This memo requests that all retirement boards submit active member, retiree/survivor, and disability retiree data as of December 31, 2013, in PERAC's standard record format. Boards must submit this data by March 31, 2014; PERAC will then return data analysis reports so boards can review and correct any warnings, errors, or questionable items to support reliable, timely actuarial valuations. Boards scheduled for a 2014 PERAC actuarial valuation should already have received a separate data request.

PERAC Memo #10/2014 updates prior guidance (Memos #15/2010 and #16/2010) on §3(8)(c) reimbursement recalculations, noting that due to a backlog of over 500 pending requests, PERAC will no longer perform recalculations where the original amount billed is under $1,000/year, is less than 10% of the total pension, or where the service with the requesting board is less than one year. Boards should apply these new thresholds before submitting recalculation requests and should expect delays of at least a year on requests already submitted, as no board action beyond awareness of the new criteria is required.

This memo reminds boards that under Chapter 28 of the Acts of 2009, Retirement Board Members and staff (including certain contracted individuals) are considered public employees subject to G.L. c. 268A ethics requirements. Boards must: (1) distribute the Ethics Commission's Summary of the Conflicts of Interest Law annually and within 30 days to new members/employees, retaining signed acknowledgments (with copies to appointing authorities for non-elected members); and (2) ensure all covered individuals complete the online ethics training every two years (within 30 days for new members/employees), retaining completion certificates for 6 years and forwarding copies to appointing authorities. Boards should also note that submitting a copy of the training certificate to PERAC can qualify for 3 credits toward the Board Member Training Requirements under G.L. c. 32, §20(7).

This memo announces a new PERAC informational CD/resource packet designed to orient newly elected or appointed retirement board members, covering topics such as actuarial valuations, trustee responsibilities, disability retirement processes, and the competitive bid process. Boards are asked to help distribute this CD to new members promptly upon their appointment or election, rather than waiting for PERAC to send it directly, though no other formal action is required.

This corrected memo (superseding Memo #13/2014) reminds boards of the mandatory annual training requirement for retirement board members under Chapter 32, noting that failure to meet this requirement bars a member from continuing to serve beyond their current term. It details specific pre-approved training credit opportunities for 2014—including three hours for State Ethics Commission conflict-of-interest seminars and four hours each for NCPERS TEDS and PATS programs—and specifies the documentation (certificates of attendance) members must submit to PERAC to receive credit. Boards should inform members of these opportunities and ensure certificates are forwarded to PERAC to properly document compliance.

PERAC Memorandum #14, 2014 announces that the Commission voted to require SEC (or, where applicable, Massachusetts Secretary of State) registration as a prerequisite for issuing an Acknowledgement Letter for any proposed investment. Boards should note that they may not proceed with an investment in an entity that lacks such registration, since PERAC will withhold the Acknowledgement Letter in these circumstances; boards should therefore verify an investment manager's SEC or SOS registration status before submitting investments for approval.

PERAC Memo #15/2014 transmits the updated April 2014 Tobacco Company List, which supersedes all prior lists and identifies companies (including pooled funds) deriving more than 15% of revenue from tobacco sales in which investment is prohibited under Chapter 119 of the Acts of 1997. Boards must ensure their portfolios comply with this list immediately upon receipt, forward or notify investment advisors of the list (for Massachusetts public fund use only), and—if PERAC's audit reveals noncompliant holdings acquired after January 13, 1998—divest in a prudent manner only after consulting with PERAC.

PERAC Memo #16, 2014 clarifies two anti-spiking exemptions under Section 18 of Chapter 176 of the Acts of 2011: (1) the "150E" exemption applies only to salaries/salary schedules actually collectively bargained for bargaining unit members, not to individual employment contracts, even if labeled as such; and (2) the "bona fide change in position" exemption applies only in the year the position change occurs (requiring an actual change in essential duties, not merely a title change), and does not shield subsequent or prior pay increases from anti-spiking review. Boards must verify that any compensation claimed under the 150E exemption stems from a true collectively bargained agreement, and must apply the bona fide change-in-position exemption narrowly—setting the two-year average equal to the new position's rate only for the transition year—when performing anti-spiking calculations.

PERAC Memo #17/2014 informs boards of an IRS Private Letter Ruling (dated August 20, 2013) clarifying the federal (not state) tax treatment of Chapter 32 disability retirement allowances and related survivor/death benefits, covering ordinary and accidental disability pensions, dependent allowances, and benefits under Sections 9, 94/94A/94B, and 100. Boards should apply these tax-status determinations prospectively from August 20, 2013 (the PLR's effective date) and correct the tax reporting/withholding treatment of any affected benefits paid on or after that date accordingly; no retroactive corrections prior to that date are required.

This memo announces that PERAC's Fund of Funds/Manager of Managers policy is now in effect, providing retirement boards with guidance on how such investment structures can satisfy Section 23B's mandatory contractual requirements regarding disclosure, indemnification, and fiduciary status. Boards considering or currently utilizing these investment vehicles should review the attached policy to ensure compliance, noting that PERAC will evaluate non-conforming structures on a case-by-case basis and consider the policy's application an evolving process. No immediate action is required beyond familiarizing staff with the policy; questions should be directed to PERAC's Investment Unit.

This memo provides follow-up guidance to Memos #22/2013 and #33/2013 on implementing the MacAloney decision regarding creditable service buybacks for call/reserve/permanent-intermittent firefighters and police officers under G.L. c. 32, §4(2)(b). It clarifies the specific contribution rates and calculation methods boards must use when a member seeks to buy back service for: (1) time actually served and compensated as a call firefighter, (2) time on an eligibility list/roster without actual service, and (3) combinations of both. Boards should apply these calculation methodologies—using actual pay and contribution rates in effect for compensated service, and the $3,000 assumed annual salary under §85H for list/roster time—when processing any such buyback requests.

PERAC Memo #20/2014 transmits the updated Tobacco Company List (dated July 2014), which supersedes all prior versions and is effective immediately upon receipt. Boards must ensure their portfolios contain no new investments in listed companies (those deriving more than 15% of revenue from tobacco sales), including pooled funds assessed at the fund level, and should forward or make the list available to their investment advisors for Massachusetts public fund use only. If a board's portfolio is found non-compliant during PERAC's audit, the board must consult with PERAC before undertaking prudent divestiture.

PERAC Memo 21/2014 addresses the impact of the *Larrson v. Stoneham Retirement Board* decision, which held that two beneficiaries cannot concurrently receive a benefit on one member's account. Effective July 1, 2014, this supersedes prior PERAC guidance (Memo 8/1997 and part of Memo 25/2004): where a member who retired for accidental disability with an Option C beneficiary later dies from the related cause, a qualifying Section 9 accidental death beneficiary now supersedes and extinguishes the Option C beneficiary's right to benefits, rather than both receiving concurrent payments. Boards need not disturb existing concurrent benefit arrangements already in pay status before July 1, 2014, but must apply this superseding rule to all new cases arising on or after that date.

This memo reminds boards of the mandatory annual training requirement for retirement board members and lists Q3 2014 approved educational opportunities, including State Ethics Commission seminars (3 credits), sessions on investment fees/legislative process/Chapter 176 (3 credits), and PERAC's Emerging Issues Forum on September 18, 2014 (3 credits). Boards should inform members of these opportunities and ensure members register/attend as needed, since failure to meet the annual training requirement bars a member from continuing to serve on the board beyond their current term.

This memo updates the schedule for State Ethics Commission Public Education Seminars on the Conflict of Interest Law, which qualify for 3 hours of mandatory retirement board member training credit (correcting dates previously issued in Memo 22/2014). New sessions are scheduled for July 24, August 21, and September 25, 2014, at the Commission's Boston office. Boards should notify members interested in attending to enroll promptly by calling 617-371-9500, as seating is limited, and ensure members obtain a Certificate of Attendance to receive training credit.

PERAC Memo #24/2014 clarifies that errors discovered in Cash Book filings, PERAC Annual Statements, or other accounting records should generally be corrected in the period in which they are discovered, consistent with GAAP practice, rather than by retroactively altering previously filed/original records—since retroactive changes undermine the integrity and comparability of reported investment and financial results. Boards must not make direct changes to original source documents or prior-period filings on their own initiative; any proposed prior-period adjustment requires prior consultation with, and approval from, PERAC before being made.

PERAC Memo #25/2014 announces an updated Application for Reinstatement to Service form under G.L. c. 32 §105 (effective July 1, 2014–June 30, 2015), which allows retired members to return to active service. Boards must carefully counsel members considering reinstatement—since it may involve substantial repayment obligations and a five-year full-time employment requirement—and must complete the initial portion of the form before providing it to interested members, whose signature converts their status from retiree to member in service. Boards using an investment return assumption not reflected on the form should contact PERAC's actuarial unit for the appropriate factors.

PERAC Memo #26/2014 announces the launch of a new Secure Electronic Document Transmission system for submitting Regional Medical Panel documents, Disability Transmittal Documents, and other secure files. To participate, board staff who handle these documents must attend one of six scheduled training sessions (August 7–27, 2014, at various locations) and obtain a completion certificate before being granted access to the encrypted submission system. Boards should identify relevant staff and email Rose Cipriani promptly to reserve a spot, as sessions are limited to 20 attendees each.

PERAC Memo #27/2014 clarifies how the August 2013 IRS Private Letter Ruling applies to benefits paid under legislative special bills (as opposed to standard Ch. 32 provisions). Boards must examine each special bill's language individually: if it explicitly references Sections 7, 9, or 100, it should be taxed accordingly (pension portion non-taxable up to 72%, annuity taxable); if it lacks such reference, boards must assess whether sufficient nexus exists to those sections to qualify for non-taxable treatment, and if not, report the benefit as "taxable amount not determined" (Box 2b of Form 1099-R). Boards taking a different reporting position should consult counsel to support that approach.

PERAC Memo #28/2014 announces the annual COLA-adjusted supplemental dependent allowance for eligible children of accidental disability retirees and accidental death survivors, set at $821.52 per eligible child effective July 1, 2014, under G.L. c. 32 §§ 7(2)(a)(iii), 22D, and 9(2)(d)(ii). Boards that have accepted these provisions must update their payment amounts to reflect this new figure; questions should be directed to PERAC actuary Jim Lamenzo.

PERAC Memo #29/2014 summarizes Chapter 165 of the Acts of 2014 (FY2015 budget outside sections), which amended the dual-member provision under G.L. c. 32, §5(2)(e). The revised law excludes overlapping service of less than 60 days, excludes positions paying under $5,000/year, and limits application of dual-member benefit calculations to only the final 5 years of creditable service before retirement (and clarifies it does not apply to §6 ordinary disability benefits). Boards must apply this narrower standard when a member has worked concurrently in two systems, determining at retirement whether the dual-member rules are triggered based on the last 5 years of service, and must return/reallocate contributions accordingly when applicable.

This memo transmits PERAC's updated Tobacco Company List (October 2014), which supersedes all prior versions, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must forward the list to their investment advisors (or direct them to it on the PERAC website), and if a PERAC audit finds a board's portfolio holds prohibited investments made after January 13, 1998, the board must consult with PERAC before prudently divesting to achieve compliance. Note also that the 15% rule applies to pooled funds in the aggregate, meaning noncompliant pooled investment vehicles will appear on the list as well.

This memo reminds boards of the mandatory annual training requirement for board members under Chapter 32 and lists pre-approved training programs/sponsors eligible for education credit, including specific credit hours for each (e.g., NCPERS, NCTR, PRIM, State Ethics Commission seminars, MACRS October Conference). No board action is strictly required, but administrators should inform board members of these approved opportunities—particularly the State Ethics Commission seminars (October 23 and December 4, 2014, in-person or via webinar) and the MACRS October Conference—to help members satisfy their annual training obligations and avoid disqualification from continued board service.

PERAC Memo #32/2014 requests that retirement boards submit appropriation questionnaire data needed to calculate FY16 governmental unit appropriations under G.L. c.32, §22D, §22(6A)(b), or §22F. Boards must complete and return the questionnaire (preferably via PERAC's website) by October 31, 2014, and should ensure their funding schedule has been updated and submitted to PERAC within the last two years, contacting PERAC if it has not.

PERAC Memo #33/2014 announces the launch of Secure Electronic Document Transmission for submitting Regional Medical Panel documents, Disability Transmittal Documents, and other secure files, and notes an additional training session scheduled for November 6, 2014 at the Springfield Retirement Board to accommodate Central/Western Massachusetts systems. Boards must have staff complete PERAC's training and receive a completion certificate before they can be granted access to submit documents electronically; interested boards should RSVP with Rose Cipriani, as space is limited to 30 attendees.

PERAC Memo #34/2014 introduces GASB Statements 67 and 68, which establish new financial reporting (not funding) standards for public pension plans—GASB 67 for plan reporting (effective for plan years beginning after June 15, 2013) and GASB 68 for employer reporting (effective for fiscal years beginning after June 15, 2014). Boards must collaborate with actuaries, auditors, and investment consultants to ensure accurate census data, financial statements, and required schedules/disclosures (e.g., net pension liability, contribution schedules, discount rate sensitivity); PRIM will assist by supplying PRIT-related data such as money-weighted returns and asset allocation for clients invested in the PRIT Fund. No funding action is required, but boards should begin coordinating with these parties to meet the new reporting requirements on the applicable timelines.

PERAC Memo #35/2014 requests that retirement boards review and update PERAC's disability retiree database, reporting any status changes in 2014 (death, nursing home confinement, waivers, return to active status, address changes) and completing the "New Member Data" form for all newly approved accidental or ordinary disability retirees. Boards must also verify which disabled retirees remain subject to the Annual Statement of Earned Income (91A) requirement under Chapter 176 pension reform waivers. All updates and forms are due back to PERAC by January 16, 2015, to ensure accuracy before the 91A mailing in late February.

PERAC Memo #36/2014 provides guidance on properly recording and reporting investment-related fees (managers, custodians, consultants) on Schedules 5 and 7 of the Annual Statement of Financial Condition. Boards must track and report fees for all investment service providers—entering $0 rather than leaving blanks when no fees are currently paid but assets remain—and must ensure Schedule 5 (pooled fund activity) reconciles with the Assets page while Schedule 7 (management fees) captures all providers, including those on Schedule 5. Boards should review their Annual Report submissions to ensure full, accurate completion of these schedules going forward.

Under Chapter 119 of the Acts of 1997, retirement systems are prohibited from making new investments in companies deriving more than 15% of revenue from tobacco sales, and PERAC's enclosed January 2015 Tobacco Company List supersedes all prior lists effective upon receipt. Boards must forward the list to their investment advisors (or notify them it is posted on PERAC's website), ensure the list is used only for the board's own fund, and note that the 15% rule applies to pooled funds in aggregate. No immediate divestment action is required unless PERAC's audit identifies non-compliant holdings, in which case the board must consult with PERAC before prudently divesting.

PERAC Memo #38/2014 addresses the annual review of the cost cap for non-invasive medical tests suggested by Regional Medical Panels under 840 CMR 10:10(3) and 10:15(4). The Commission voted on December 4, 2014 to maintain the existing threshold, authorizing PERAC staff to approve such testing costs up to $100 per case without additional Commission approval. No action is required by retirement boards beyond awareness of this continuing policy.

This memo reminds retirement board members of the mandatory annual continuing education requirement under Chapter 32, noting that failure to complete required training will disqualify a member from serving beyond the end of their current term. It lists pre-approved non-PERAC/non-MACRS courses and organizations (e.g., NCPERS, NCTR, IFEBP, PRIM, State Ethics Commission seminars) eligible for education credits, and specifies that affidavits are acceptable proof of attendance for certain online courses. Boards should ensure their members are aware of and complete the required training, use the pre-approved list to plan qualifying courses, and submit certificates or affidavits of attendance to PERAC to obtain credit.

PERAC Memo #1/2013 provides the annual IRS Section 401(a)(17) and Section 415 limits for 2013, setting the compensation limit used to calculate retirement allowances at $255,000 and the general annual benefit limit at $205,000 for retirement at age 65 (reduced for earlier retirement ages). These limits, as indexed annually under Chapter 46 of the Acts of 2002, apply only to a system's highest-paid members, so boards need only apply them when calculating benefits for those affected employees, with questions directed to PERAC's Actuary.

PERAC Memo #2/2013 establishes the 2013 regular compensation cap for members who joined a retirement system after January 1, 2011, set at $163,200 (64% of the IRS 401(a)(17) limit of $255,000). Boards must ensure that regular compensation used for retirement calculations for these post-2011 members does not exceed this limit for calendar year 2013.

PERAC Memo #3/2013 reports that the Social Security Administration's announced COLA is 1.7%, which sets the base COLA that Massachusetts retirement systems may grant effective July 1, 2013 under Chapter 32, §103(c). Boards may vote at a duly called meeting to increase this rate up to 3.0% under §103(i), provided proper notice is given to the local legislative body; each board must notify PERAC of its COLA decision (whether to grant one, and at what rate) within 30 days of the vote.

PERAC Memo #4/2013 transmits updated instructions, worksheets, and a cumulative interest factor sheet for calculating buyback and make-up repayments using buyback interest for calendar year 2013, applicable to the various G.L. c. 32 provisions referenced in Memos #13/2005 and #28/2008. Boards should use these updated tools for all applicable buyback/make-up calculations performed during 2013, and may contact John Boorack with questions.

PERAC Memo #5/2013 notifies retirement boards that, per Chapter 176 of the Acts of 2011, the Executive Office of Administration & Finance (A&F) has commissioned Buck Consultants to conduct an independent study of potential structural reforms to the state pension system, using data from boards' Annual Statements and actuarial information. No timeline for findings has been provided, but boards should be aware that A&F or Buck Consultants may contact them directly with inquiries in the coming weeks and months; no other action is currently required.

This memo covers preparation of the 2012 Annual Statement, which boards must complete, sign, and return to PERAC by May 1, 2013, along with submitting pre-closing cashbooks and trial balances for December 2012 by March 1, 2013. It highlights key changes for this filing year—including new general ledger accounts for reinstatements/recoveries and a new Schedule 7 for investment-related fee disclosure—and notes optional "Financial Accounting for Retirement Systems" training sessions (satisfying the annual education requirement) that boards may register for via email.

**PERAC Memo #7/2013** follows up on Memo #4/2013 (buyback/make-up interest calculations and worksheet for 2013) by reminding boards that, per G.L. c. 32, §3(8)(b) as amended by Ch. 176 of the Acts of 2011, some service purchases must instead use actuarial assumed interest rather than buyback interest, depending on specific factors. Boards should read Memo #4/2013 alongside Memo #23/2012 for guidance on applying these rules, and should anticipate a forthcoming March memorandum clarifying the transition, since as of April 2, 2013, all purchases of prior non-membership service must be calculated using actuarial assumed interest. No immediate action is required beyond continued use of current guidance until the March memo is issued.

PERAC Memo #8/2013 announces that retirement board members who complete the Ethics Commission's newly revised online Conflict of Interest Law training will now receive 3 educational credits toward their Chapter 32 training requirement, since the updated program now includes substantive content rather than just multiple-choice questions. Board members must access the training via the Ethics Commission website, generate a completion certificate, and submit it to both their retirement board and PERAC; note that credit is granted only once per two-year term, corresponding to the mandatory frequency of the Ethics Law training itself.

PERAC Memo #9/2013 establishes the "regular interest" rate for member accounts under G.L. c. 32, § 22(6)(b) at 0.1% for calendar year 2013, based on average savings account rates from a sample of financial institutions. Boards must apply this rate to accumulated total deductions and accrued interest when crediting interest for refunds and retirements processed during 2013, and must also credit it on December 31, 2013 to outstanding account balances as of December 31, 2012.

PERAC Memo #10/2013 requests that all retirement boards submit actuarial data for active members, retirees/survivors, and disability retirees as of December 31, 2012, in the standard PERAC record format. Boards must submit this data by March 31, 2013, so PERAC can generate data analysis reports to help identify and correct errors or discrepancies, supporting reliable and timely actuarial valuations; boards scheduled for a 2013 PERAC valuation should have already received a separate, specific data request.

This memo reminds retirement boards of the good-faith certification requirements under G.L. c. 32, §23B that apply to all procurements of investment, actuarial, legal, and accounting services—not just investment services. Boards must ensure that (1) each vendor submitting a proposal certifies in writing that it was made without collusion or fraud, and (2) each individual board member similarly certifies in writing regarding the procurement. Boards should use the standardized "Vendor Certification" and "Retirement Board Member Certification" forms available on PERAC's website to satisfy these requirements.

This memo directs retirement boards to distribute the 2012 Statement of Financial Interests (SFI) form and accompanying instructions to all board members, per M.G.L. c. 32, §20C. Boards must ensure each member files the SFI with PERAC by 5:00 PM on May 1, 2013, and that any newly appointed or elected member filing for the first time submits their statement within 30 days of taking office. PERAC also notes updates to the form and instructions based on the prior year's filing experience.

PERAC Memo #13/2013 transmits the updated (April 2013) Tobacco Company List, which replaces all prior lists and is effective immediately upon receipt, identifying companies deriving more than 15% of revenue from tobacco sales in which new investments are prohibited under Chapter 119 of the Acts of 1997. Boards must forward the list to their investment advisors (or direct them to it on PERAC's website), noting it is restricted to use for Massachusetts public fund clients only; boards found holding non-compliant securities—including pooled funds meeting the 15% threshold—must consult with PERAC before divesting in a prudent manner.

PERAC Memo #14/2013 follows up on Memos #4/2013 and #7/2013 regarding the requirement under G.L. c. 32, §3(8)(b) (as amended by Ch. 176 of the Acts of 2011) that certain buyback repayments be calculated using actuarial assumed interest rather than regular interest. It transmits the revised 2013 repayment worksheet, make-up worksheet, and cumulative interest factor sheet reflecting actuarial assumed interest rates for calculations covering buybacks under G.L. c. 32 §§3(6)(c), 3(6)(d), 3(8)(b), and related make-up provisions. Boards should begin using these updated 2013 forms immediately when calculating applicable buyback and make-up repayment amounts, and may contact John Boorack with questions.

This memo (PERAC Memo #15/2013) reminds retirement boards of the mandatory annual training requirement for board members under Chapter 32 and outlines pre-approved training credit opportunities for the second quarter of 2013, including State Ethics Commission seminars (3 hours credit) and NCPERS TEDS/PATS programs (4 hours credit each). No board action is required beyond ensuring members attend qualifying sessions and submit certificates of attendance/completion to PERAC to receive credit toward their training obligation.

PERAC Memo #16/2013 requests that all retirement boards assist in compiling data for PERAC's 2012 Annual Report by reviewing and verifying two enclosed documents: a board data sheet (contact/meeting information current as of today, but board member/administrator names as of December 31, 2012) and a list of investment managers, custodian, and consultant retained as of December 31, 2012. Boards must annotate any corrections (including manager name changes, fund liquidations, or terminations with supporting documentation/dates), or mark the documents "correct" if no changes are needed, and return them to Rose Cipriani by May 3, 2013.

PERAC Memo #17/2013 announces proposed amendments to 840 CMR 3.07 and 3.10 (implementing HEART Act requirements for military service-related death/disability benefits and rollover accounting) and to 840 CMR 3.08 (simplifying IRS Section 415 limit calculations). No immediate board action is required, but boards should review the draft regulations and may submit public comments—by July 19, 2013 for the HEART Act changes and August 2, 2013 for the 3.08 amendments—or attend the scheduled public hearings in Somerville and Worcester in July 2013.

PERAC Memo #18/2013 reminds boards of the Chapter 32 mandatory annual training requirement for board members and outlines pre-approved educational credit opportunities for Q3 2013, including State Ethics Commission seminars (3 credits), NCPERS PATS at Harvard Law School (4 credits), and the NCTR Trustee Workshop (4 credits). No board action is required beyond ensuring members are aware of and can register for these approved sessions, and submitting Certificates of Attendance (for Ethics Commission seminars) to PERAC to obtain credit.

PERAC Memo #19/2013 announces an updated Application for Reinstatement to Service form (G.L. c. 32 §105), effective July 1, 2013 through June 30, 2014, which reinstates retirees to active member-in-service status. Boards must use the revised form, carefully counsel interested members on the repayment obligations and five-year full-time employment requirement before they sign, and contact PERAC's actuarial unit if a needed investment return assumption factor is not listed on the form.

This memo transmits PERAC's updated Tobacco Company List (dated July 2013), which supersedes all prior lists and identifies companies deriving more than 15% of revenue from tobacco sales, in accordance with Chapter 119 of the Acts of 1997 prohibiting new retirement system investments in such companies. Boards must ensure their portfolios (including pooled funds assessed at the pool level) comply with this list going forward, distribute it to their investment advisors for Massachusetts public fund use only, and consult with PERAC before divesting to bring any non-compliant holdings identified through PERAC's audit process into compliance.

PERAC Memo #21/2013 announces the updated annual COLA amount for the supplemental dependent allowance—$797.64 per eligible child, effective July 1, 2013—applicable to accidental disability retirees and accidental death survivors under G.L. c. 32, §§ 7(2)(a)(iii), 22D, and 9(2)(d)(ii). Boards that have accepted these provisions must begin paying the increased amount to eligible dependents as of that date; no further board action beyond implementing the new rate is required.

This memo summarizes the CRAB decision in MacAloney v. Worcester Regional Retirement System, which held that G.L. c. 32, §4(2)(b)'s five-year full-time credit provision for call/reserve/permanent-intermittent firefighters and police officers does not preempt local board rules granting additional pro-rated service credit for call service beyond that initial five-year period, and that such service beyond five years, as well as prior non-membership service, remains subject to make-up payment requirements under §§3(2)(c), 3(3), 3(5), and 4(2)(c). Retirement boards must apply §4(2)(b)'s five-year full-time credit rule independently from other creditable service provisions, and should grant pro-rated credit (subject to applicable make-up payments) for any call/intermittent service extending beyond the initial five years, consistent with this now-final and binding CRAB decision.

PERAC Memo #23/2013 informs boards that the IRS is renewing the Cycle C determination letter filing process for governmental plans, and that PERAC intends to coordinate a consolidated "master" filing similar to 2008, expected to be even more streamlined for local boards. Boards should anticipate receiving filing materials in October 2013, take any necessary board action at their October or November meetings, and submit required information to PERAC by December 2, 2013; boards choosing not to participate must independently retain tax counsel to pursue their own IRS determination letter.

This memo (PERAC Memo #24/2013) reminds retirement boards of the mandatory annual training requirement for board members and lists approved 4th-quarter 2013 educational opportunities eligible for credit, including AG Open Meeting Law forums, State Ethics Commission seminars, and the MACRS October Conference. No board action is required beyond ensuring members register in advance for these pre-approved sessions and complete their required training credits to remain eligible to continue serving on the board.

This memo requests that boards submit FY15 appropriation data (via the online questionnaire or PERAC's website) needed to calculate governmental unit appropriations under G.L. c.32, §§22D, 22(6A)(b), or 22F, with a deadline of October 31, 2013. Boards must complete and return the appropriation questionnaire by that date, and should also confirm their funding schedule has been resubmitted to PERAC for approval within the last three years, contacting PERAC if an update is needed.

PERAC Memo #26/2013 announces this year's fraud-awareness poster campaign, "Pension Fraud! Let's Cut it Out!", promoting the fraud hotline and PensionFraud@per.state.ma.us email address, and encloses posters, brochures, and "Referral Report of Potential Fraud" forms. Boards are asked to display the posters prominently in their offices and other high-visibility locations, ensure staff use the referral forms to report suspected fraud to PERAC's Fraud Prevention Unit, and make the forms available to the public; additional copies can be requested from PERAC's Communications Director.

This memo announces two optional training sessions (October 16 and 17, 2013, at PERAC's Somerville offices) to help boards complete IRS Determination Letter filing forms for Cycle C, following up on Memo #23/2013. Because Ice Miller will prepopulate each board's forms, boards need only review the prepopulated information and obtain the Chairman's signature—no independent action is required, though boards wishing detailed guidance should register with Rose Cipriani to attend a session.

PERAC Memo #28/2013 announces a third and final training session (October 23, 2013, 2:00–3:30 PM at PERAC's Somerville office) to assist boards with completing their IRS determination letter application packets, which are largely prepopulated by tax counsel Ice Miller and thus require less work than in the prior cycle. Boards should ensure they register for the session if they have questions, and must complete and return all determination letter materials to Ice Miller by the December 2, 2013 deadline.

This memo clarifies that the IRS Form 5300 "participant" count (Line 4e) prepared by Ice Miller only included active and retired members, but per IRS instructions, the definition also requires including non-retiree inactive members with nonforfeitable vested benefits and beneficiaries of deceased employees entitled to benefits. Boards must review their IRS Determination Letter packet and hand-write the corrected total participant count (adding any applicable inactives/beneficiaries) on page 4, box 4e, before returning it to Ice Miller; boards that already submitted their packets should instead email Judith Corrigan or Patrick Charles at PERAC to coordinate the correction.

This memo reiterates the G.L. c. 32 § 91(b)-(c) post-retirement earnings and hours limits for public retirees who return to work for any Massachusetts public employer: no more than 960 hours per calendar year, and earnings (combined with pension) capped at the salary of the position from which they retired, plus a $15,000 annual grace amount available only after 12 months of retirement (applicable in 2014 for those retired on or before January 1, 2013). While primary enforcement responsibility rests with the employer/treasurer, retirement boards may also be liable to collect overearnings under fiduciary duty per Flanagan v. CRAB. Boards should coordinate with local CEOs/treasurers—who are receiving parallel guidance—to identify retired employees, share pension/salary data, and use the attached Earnings Worksheet and Q&A to ensure limits are properly monitored and enforced.

PERAC Memo #31/2013 transmits the updated October 2013 Tobacco Company List, which supersedes all prior lists and is effective immediately upon receipt, identifying companies deriving more than 15% of revenue from tobacco sales in which new investments are prohibited under Chapter 119 of the Acts of 1997 (including pooled funds that meet this threshold). Boards must forward the list to their investment advisors (or direct them to it on the PERAC website, noting it is for Massachusetts public fund use only) and ensure no new prohibited holdings are acquired, since PERAC will review portfolios for compliance during audits. If a board's portfolio is found non-compliant, it must consult with PERAC before prudently divesting from the affected holdings.

Memorandum #32 (2013) advises boards on implementing the SJC's *Herrick v. Essex Regional Retirement Board* decision, which held that when a board's legal error in denying benefits is corrected, the member is entitled to interest on the retroactive lump-sum payment to make them actuarially whole. PERAC directs boards to adopt a consistent interest rate (suggesting the § 22(6)(b) regular interest rate or the 3% statutory refund rate) and apply it to all G.L. c. 32 § 20(5)(c)(2) adjustments going forward—covering both underpayments and overpayments (subject to waiver provisions). Boards must also pay interest retroactively to any member/beneficiary who already received a corrective adjustment and now petitions for interest on that underpayment period.

**PERAC Memorandum #33/2013** provides follow-up guidance on the CRAB *MacAloney* decision affecting buy-backs under G.L. c. 32, §4(2)(b) for call firefighters and similarly situated reserve/permanent-intermittent police and fire personnel. It clarifies that only members who were not yet retired as of June 21, 2013 must make contributions for such service going forward, and it details the calculation methodology for buy-backs—both for periods of actual compensated service (using contribution rates in effect at the time) and for periods on eligibility lists/rosters without pay (using the $3,000 statutory rate under §85H)—with buy-back interest applied only prospectively from June 21, 2013, not retroactively to the original service period. Boards should apply this methodology when processing affected members' service purchases and ensure contributions are collected consistent with this timeline.

PERAC Memorandum #35, 2013 requests that boards review and update their disability retiree database to reflect any 2013 status changes (death, nursing home confinement, waiver, return to active status, address changes), and to complete the "New Member Data" form for all newly approved disability retirees from 2013. Boards must also help follow up with disability retirees who did not respond to the Affidavit Waiver, as non-respondents will be required to file a 2013 Annual Statement of Earned Income (91A). All information is due back to PERAC by January 15, 2014, to ensure accuracy before the 91A mailing in late February.

This memo announces PERAC's annual review of the medical testing fee cap under 840 CMR 10:10(3) & 10:15(4), confirming that at its December 12, 2013 meeting, the Commission voted to continue the existing $100 per-case limit for non-invasive medical tests ordered through the Regional Medical Panel process. No action is required by boards; this is informational, confirming the fee cap remains unchanged.

This memo announces a new statutory requirement (Chapter 176 of the Acts of 2011, amending G.L. c. 32) that retirement board members file a Chapter 268A Compliance Pledge Form acknowledging awareness of and compliance with c. 268A, c. 32, and related regulations. Boards must ensure that any member beginning or renewing a term after February 16, 2012 completes and submits this form to both the board and PERAC before assuming office; current members are not required to file until their next re-election or re-appointment. Boards should inform prospective candidates or appointees of this filing requirement as part of the election/appointment process.

This memo explains the new local option under G.L. c. 32, §20(6), effective February 16, 2012, which replaces the former $3,000 stipend option and allows retirement board members' annual stipend to be set between $3,000 and $4,500 (with ex officio members capped at $4,500 total for active administration services). Boards themselves do not vote on this—the local legislative body (city council, town meeting, county/regional advisory council, district members, or authority governing body) must accept the option, and the specific dollar amount must be stated in that vote. Boards should notify PERAC of acceptance with certified copies of the vote, and may wish to bring the option to their legislative body's attention, but must adopt a new acceptance vote (even if the old $3,000 option was previously accepted) to raise the stipend above $3,000.

This memo transmits PERAC's updated January 2012 Tobacco Company List, which supersedes all prior lists effective immediately upon receipt, identifying companies deriving over 15% of revenue from tobacco sales (per Chapter 119 of the Acts of 1997) in which retirement systems are prohibited from making new investments. Boards must distribute or notify their investment advisors of this list (for Massachusetts public fund use only), ensure post-1/13/1998 portfolios do not hold prohibited securities—including pooled funds assessed at the fund level—and consult with PERAC before divesting to bring any noncompliant portfolio into compliance.

This memo notifies boards of the new Chapter 176 eligibility restriction (effective April 2, 2012) barring individuals who receive remuneration from a retirement board or its vendors—other than a retirement allowance or statutory board stipend—from serving as board members. The restriction applies only to individuals first becoming board members on or after that date, not current members. Boards must inform all candidates seeking a board position that they are required to file the attached eligibility certification Form with both the retirement board and PERAC as part of the election process.

PERAC Memo #05/2012 establishes the "regular interest" rate for 2012 at 0.1%, as determined under G.L. c. 32, §22(6)(b) based on average savings account rates from a sample of financial institutions. Boards must apply this 0.1% rate to accumulated total deductions and accrued interest for refunds and retirements processed during 2012, and credit it to outstanding member account balances as of December 31, 2011 on December 31, 2012.

This memo announces preparation requirements for the 2011 Annual Statement, due to PERAC signed and completed by May 1, 2012, and provides materials (CD with Annual Statement, sample, and preparation guide) to assist boards. It also announces training classes—which satisfy board members' new three-hour annual education requirement and cover remote participation, regular compensation, buybacks, and procurement files—and requires boards to submit pre-closing cashbook and trial balance for December 2011 to PERAC before February 28, 2012.

This memo announces that PERAC's Placement Agent Policy (originally detailed in Memo #34/2011) is now in effect, requiring investment managers to file a Placement Agent Disclosure Form with both the retirement board and PERAC when responding to RFPs, negotiating contract amendments, or engaging in substantive discussions with a board. Boards must ensure this disclosure form is obtained from managers as part of any ongoing or new contract negotiations, and must incorporate the specified contract terms/remedies (e.g., fee reimbursement) into all new contracts and amendments executed on or after January 1, 2012. Administrators should review any contracts currently being negotiated or amended to confirm compliance with these disclosure and contract-term requirements.

**Summary:** This memo explains that Chapter 198 of the Acts of 2011 restores the validity of "Evergreen Clauses" in collective bargaining agreements, allowing contract terms to remain in effect beyond three years until a successor agreement is negotiated. As a result, payments that qualified as "regular compensation" under the Chapter 21 (2009) grandfather clause—and were included in a contract in effect on May 1, 2009—may continue to be treated as regular compensation (through June 30, 2012) if the underlying contract remains in effect via its stated term or an Evergreen Clause, provided the payment is for "services" rather than a "tool" (per the *O'Brien v. CRAB* decision). **Action required:** Boards should review affected collective bargaining agreements to confirm whether Evergreen Clauses apply, verify whether specific payments (e.g., clothing allowances) qualify as compensation for services versus tools, and adjust regular compensation determinations accordingly for reporting/withholding purposes through the June 30, 2012 cutoff.

PERAC Memorandum #09/2012 requests that all retirement boards submit active member, retiree/survivor, and disability retiree data as of December 31, 2011, in the standard PERAC record format. Boards must submit this data by March 31, 2012, after which PERAC will provide data analysis reports to help identify and correct errors or warnings, supporting accurate and timely actuarial valuations. Boards scheduled for a 2012 PERAC actuarial valuation should already have received a separate data request.

PERAC Memo #10/2012 updates the Chapter 46 (2002) compensation and benefit limits under IRC §401(a)(17) and §415 for 2012: the compensation cap is $250,000 and the general benefit limit is $200,000/year at age 65 (reduced for earlier retirement). This applies only to the highest-paid members and most systems/members will be unaffected; boards should apply these updated limits when calculating affected members' allowances and contact PERAC's Actuary Jim Lamenzo with questions—no other action is required.

PERAC Memo #11/2012 notifies boards that for members who joined a retirement system after January 1, 2011, the 2012 cap on regular compensation under Chapter 131, Section 23 of the Acts of 2010 is $160,000, calculated as 64% of the IRS Section 401(a)(17) limit of $250,000. Boards should apply this $160,000 ceiling when determining regular compensation for affected members' retirement calculations in 2012, and may contact PERAC's Actuary with questions.

PERAC Memorandum #12/2012 transmits the updated 2012 worksheets, instructions, and cumulative interest factor sheet for calculating member buybacks and make-up payments under the applicable G.L. c. 32 provisions, using buyback interest as referenced in prior Memos #13/2005 and #28/2008. Boards should use these updated tools for all buyback/make-up calculations performed during 2012 and contact PERAC (John Boorack) with any questions; no other action is required.

This memo announces that, per the Social Security Administration's 3.6% COLA determination, the maximum COLA local retirement boards may grant under c. 32, §103(c) effective July 1, 2012 is capped at 3.0%. Boards wishing to adopt a COLA must vote at a properly posted public meeting called for that purpose, provide the legislative body at least 30 days' notice, and complete these steps by June 30, 2012; each board must notify PERAC of its decision (whether to grant or not) within 30 days of that vote.

PERAC Memo #14/2012 notifies boards that Sections 29–30 of Chapter 176 of the Acts of 2011 create a local option, effective February 16, 2012, allowing the minimum monthly retirement allowance under G.L. c. 32, §12(2)(d) to be raised from $250 to $500. To adopt this increase, both the retirement board and the applicable local legislative body must vote to accept it, and the board must file a certification of acceptance with PERAC; the increased benefit applies only prospectively from the filing date, with no retroactive payments.

This memo alerts boards that Chapter 176 of the Acts of 2011 establishes a new mandatory competitive sealed proposal (RFP) process under G.L. c. 32, §23B for procuring investment, actuarial, legal, and accounting services, effective February 16, 2012, and reminds boards that fiduciary duty under §23(3) still governs all procurement decisions. Boards must immediately review any procurements in progress: any covered procurement not resulting in an executed contract by February 16, 2012 will be voided and must be restarted under the new RFP requirements, including specific RFP content, written evaluation criteria, and a six-year document retention file for each contract.

This memo addresses PERAC's need to update its records on retirement board members in light of Chapter 176 of the Acts of 2011, which imposes new filing and mandatory education requirements for board members. Boards must ensure each member reviews the enclosed pre-filled forms, corrects or completes their personal data, and returns them to PERAC by February 20, 2012; going forward, boards must also submit a Retirement Board Change Form whenever board membership changes.

This follow-up to Memo #30/2011 clarifies that the shift substitution documentation/verification policy applies prospectively only—boards should only inquire about shift substitution and unrepaid shifts for members retiring on or after October 26, 2011, and only for shifts occurring on or after that date (not retroactively to Chapter 21 of the Acts of 2009 or earlier). Boards should verify that employers are tracking shift substitution and repayment from October 26, 2011 forward, and may wish to issue guidance to their employers instructing them to establish record-keeping systems to properly certify creditable service and regular compensation for retirement calculations going forward.

This memo addresses the need for retirement boards to counsel members who are considering withdrawing their contributions, given that Chapter 176 significantly changes retirement rights and benefits for anyone who later re-enters public service and becomes a member on or after April 2, 2012 (e.g., higher minimum retirement age, new age factors, five-year salary averaging, new contribution rates, loss of §10 termination allowance). Boards should fully inform any member seeking a withdrawal of these consequences, referencing PERAC Memo #36/2011 for details, before processing the withdrawal.

This memo transmits the newly required 2011 Statement of Financial Interests form and instructions, issued under new G.L. c. 32, §20C (as added by Chapter 176 of the Acts of 2011), which mandates financial disclosure by retirement board members. Boards must ensure every member serving as of February 16, 2012 files the statement by 5:00 PM on May 1, 2012, and that any member newly appointed/elected on or after that date files within 30 days of taking office; note that "immediate family" is defined narrowly as a spouse and dependent children residing in the household.

This memo requests that retirement boards assist PERAC in compiling data for its 2011 Annual Report by verifying board contact/member information, confirming the list of investment managers, custodian, and consultant as of December 31, 2011, and calculating and reporting their Target Investment Rate of Return. Boards must review, annotate (or mark as correct), and return the data sheet, manager/custodian/consultant list, and target rate of return to PERAC by February 28, 2012.

This memo notifies retirement boards that the Attorney General's Office has issued an updated Open Meeting Law Guide, with the most significant addition being guidelines on remote participation in meetings. Boards should review the updated guide, accessible via the AG's website or PERAC's website, to ensure continued compliance with Open Meeting Law requirements, particularly regarding remote participation procedures. No formal action is required beyond familiarizing board members with the updated guidance.

This memo reinforces the anti-collusion/anti-fraud certification requirements under the new Section 23B procurement statute (Chapter 176 of the Acts of 2011), which apply to procurements of investment, actuarial, legal, and accounting services. Both prospective vendors and retirement board members must certify that proposals are submitted in good faith without collusion or fraud, and board members must file their certification with PERAC. Boards should take action by ensuring these certifications are obtained and filed for every applicable procurement, and by proactively questioning vendors about potential collusion schemes (e.g., bid-suppression arrangements) rather than relying solely on vendor assurances.

This memo explains the implementation of Chapter 176 of the Acts of 2011, which amends G.L. c. 32, §3(8)(b) to require actuarially assumed interest (rather than buyback interest) on service purchases not completed within specified deadlines, effective April 2, 2012. Boards must apply buyback interest only if members in service/inactive members complete purchases or enter installment agreements (max 5 years) by April 2, 2013, and must apply similar deadline rules (one year from re-entry or April 2, 2013, whichever is later) for reinstated/re-entering members; failure to meet these deadlines or default on an installment agreement requires the board to prospectively switch to full actuarial assumed interest on the outstanding balance. Boards should review pending and future service purchase agreements to ensure compliance with these new interest-rate and deadline requirements.

This memo provides IRS-vetted guidance on correcting mistaken excess member contributions (from erroneous compensation, service purchase errors, membership errors, etc.) by issuing a lump-sum "corrective distribution" to the member. It details specific Form 1099-R reporting requirements (using Code E in Box 7) depending on whether the erroneous contributions were pre-tax or after-tax, and clarifies that such distributions are exempt from the early withdrawal penalty, FICA/FUTA, and rollover eligibility, though 10% withholding applies unless waived. Boards should adopt this reporting methodology whenever they identify and refund mistaken member contributions, ensuring proper 1099-R coding, and are encouraged to send members an explanatory letter referencing Revenue Procedure 92-93 for the use of Code E.

PERAC Memo #25, 2012 announces that board members who attend the NCPERS Trustee Educational Seminar (TEDS) in New York on May 5-6, 2012 can earn 4 hours of educational credit. Boards should note that attendees must sign in/out with photo ID and submit a copy of their attendance certificate to PERAC to receive credit, and are encouraged to register before April 10, 2012 for the discounted rate. No other action is required of boards.

This memo notifies boards that under Chapter 176 of the Acts of 2011, each retirement board member must complete 18 hours of training per term, effective calendar year 2012, and describes PERAC's process for tracking compliance (forms issued by PERAC, member submissions due January 31, 2013, PERAC status reports by March 1, 2013). It also announces upcoming/completed PERAC training sessions (including an evening session and Ethics Commission credit opportunities) available to help members meet this requirement. Action required: Boards must ensure their members are aware of and complete the mandatory 18-hour training requirement, distribute PERAC's completion forms to members, and facilitate timely submission of those forms to PERAC by the January 31, 2013 deadline, since failure to meet the requirement bars a member from continuing service beyond the current term.

This memo explains that Chapter 176 simplified PERAC's investment review process: the detailed "Application for Exemption" is eliminated, and PERAC now issues an "acknowledgement of receipt" rather than an exemption/waiver for manager and consultant investments. Boards must submit specific documentation before investing with a manager or retaining a consultant—including procurement and vendor certifications, disclosure forms (placement agent, conflict of interest, compensation), prohibited investment compliance certification, consultant report certification, and individual board member certifications—and obtain PERAC's acknowledgement before proceeding, which PERAC may withhold if not in the system's best interest. Boards should also review this memo alongside related PERAC memos (#22, #15, #7/2012 and #35, #34/2011) for full context on the reform law's investment and disclosure requirements.

This memo provides an updated worksheet implementing Chapter 176 of the Acts of 2011, which allows superannuation retirees (retired over 12 months) returning to public employment to earn up to $15,000 above their former position's salary when combined with their retirement allowance, effective April 2, 2012; the 960-hour annual work limit remains unchanged. Boards should discard the worksheet issued with Memo #28/2011 and use the enclosed updated worksheet to calculate 2012 post-retirement earnings limits, noting that the additional $15,000 applies only to retirees whose effective retirement date was on or before April 1, 2011 for calendar year 2012 (with later retirees becoming eligible in subsequent years per the one-year lookback rule).

This memo explains Section 14 of Chapter 176 of the Acts of 2011, which requires pro-ration of §32(5) retirement benefits for members who served in multiple job groups, calculating each group's portion separately using the same average pay but group-specific age factors and service years, then summing them. Pro-ration is mandatory for members joining on or after April 2, 2012, but optional for those already active as of that date. Boards must counsel members with multi-group service histories about this option and be prepared to perform the segmented calculations as illustrated in the memo's example.

**Memorandum #30, 2012** transmits an updated Tobacco Company List (dated April 2012), which supersedes all prior versions, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must share the list with their investment advisors (noting it is restricted to use for Massachusetts public fund clients only) and ensure their portfolios—including pooled fund holdings assessed at the pool level—remain compliant; any non-compliant holdings identified through PERAC's audit process must be divested prudently, in consultation with PERAC before taking action.

This memo clarifies COLA notification requirements for 2012: since the SSA COLA (3.6%) exceeds the statutory 3% cap, boards do not need to notify their legislative body under G.L. c. 32, §103. However, boards must still vote to accept the COLA (as reported by PERAC) at a properly posted public meeting before June 30, 2012, and must notify PERAC of that vote within 30 days. PERAC also recommends boards voluntarily inform their legislative body of the action, such as by sharing the meeting agenda.

Memo #32/2012 reminds retirement board members that their 2011 Statement of Financial Interests (SFI) filings, required annually under Chapter 176 of the Acts of 2011, are due at PERAC by May 1, 2012. It also details the confidentiality Security Protocols the Commission unanimously adopted on March 26, 2012 governing how SFIs are received, processed, stored, and accessed by PERAC staff and Commissioners. Action required: board members who have not yet filed their SFI must submit it to PERAC by the May 1, 2012 deadline.

This memo announces new Chapter 32, §15(7), effective immediately, which bars members from receiving a retirement allowance based on salary intentionally concealed from or misreported to the relevant reporting entity; where such misconduct is found, the allowance must be calculated on the lower of the amount actually reported to that entity or to the board, with excess deductions refunded without interest. Boards should note that PERAC (the Commission) is responsible for making the formal determination of concealment/misreporting via a hearing process, and boards must contact PERAC whenever a retirement application raises concerns about unreported or misreported compensation so that an investigation can be conducted before the allowance is finalized.

This memo reminds boards that under Chapter 176 of 2011, each retirement board member must complete 18 hours of training annually (effective for 2012), with completed statements due to PERAC by January 31, 2013; failure to meet this requirement bars the member from continuing to serve beyond the current term. It also announces PERAC's approval of the NCPERS PATS program (July 30–Aug 1, 2012, Harvard Law School) for 4 hours of training credit, with registration due by May 18, 2012. Action required: Boards should ensure members are aware of and pursuing the 18-hour training requirement, distribute PERAC's completion forms to members when issued, and inform members of the PATS opportunity if interested in registering before the deadline.

This memo provides a quarterly update on the mandatory 18-hour annual training requirement for retirement board members under Chapter 176 of the Acts of 2011 (M.G.L. c. 32, §20, Subdivision 7), effective for 2012. It confirms educational credit awarded for MACRS Conference sessions and various PERAC-hosted programs (ethics, actuarial basics, disability), and clarifies the pre-approval process for outside training events. Boards should ensure members are aware of the requirement, distribute PERAC's forthcoming statement-of-completion forms to members, and confirm that members submit completed forms to PERAC by January 31, 2013, since failure to meet the training requirement will bar a member from continuing to serve beyond their current term.

PERAC Memo #36/2012 notifies retirement boards that, following his criminal conviction, the Commission has formally prohibited Timothy McDaid (former Executive Director of the Maynard Retirement Board) from serving in any capacity—as member, employee, consultant, or service provider—with any Massachusetts public retirement system, pursuant to 840 CMR 1.03. Boards should ensure they do not employ or engage McDaid directly or through any affiliated firm, partnership, or entity; any such entity that fails to disclose his involvement will be subject to sanctions under G.L. c. 32, §21A. No further action is required beyond ensuring compliance with this prohibition.

This memo reminds boards that, as the five-year anniversary approaches for systems that voluntarily transferred assets to PRIT in 2007 under Chapter 68 (in lieu of a Commission-ordered permanent transfer for underperformance/low funded ratio), PERAC intends to reassess those systems' status. Boards should be aware that if a system withdraws from PRIT at this point, the Commission may promptly issue a permanent transfer Order under Section 22(8)(c½) if the system still meets the underperforming criteria (funded ratio below 65% and 10-year returns at least 2% below PRIT). No immediate action is required beyond awareness, but affected boards should consider this risk before deciding to withdraw from PRIT.

This memo explains the anti-spiking provisions in Sections 14 and 18 of Chapter 176 of the Acts of 2011, which cap the regular compensation used to calculate retirement allowances for members retiring on or after April 2, 2012. Boards must review every applicable retirement calculation under both sections (as a benefit could violate either or both), and must confirm to PERAC that this anti-spiking review was performed—either through submission for approval or, for boards with waivers, via attestation. PERAC notes it is developing calculation worksheets to assist boards and will notify boards once these are available.

PERAC Memo #39/2012 clarifies the treatment of payments made when employees sell back unused vacation leave (distinct from payments for unused sick, personal, or other event-based leave, which are excluded from this analysis), superseding Memos #25/2000 and #26/2000. It directs boards to apply the two-part regular compensation threshold test—whether payments constitute base/"other base compensation" and whether they represent "services performed"—consistent with Chapter 21 of the Acts of 2009 and 840 CMR 15.03(3), and to only treat such buy-back payments as regular compensation (subject to retirement deductions) if both prongs are satisfied. Boards must review applicable collective bargaining agreements and vacation buy-back provisions to make this individualized determination for each payment arrangement, and are also reminded of their obligation under Chapter 176 of the Acts of 2011 to retain and review CBAs for Chapter 32 compliance.

This memo announces PERAC's updated Application for Reinstatement to Service from Superannuation/Termination Retirement under G.L. c. 32 §105, effective July 1, 2012 through June 30, 2013. Boards should use the revised form when a member seeks reinstatement, carefully counsel members on the requirements (including repayment obligations and the five-year full-time service commitment), complete the initial portion of the form for interested members, and contact PERAC's actuarial unit if a needed investment return assumption factor is not listed on the form.

This memo announces the updated annual supplemental dependent allowance—$774.36 per eligible child, effective July 1, 2012—payable under G.L. c. 32 §§ 7(2)(a)(iii), 22D, and 9(2)(d)(ii). Boards that have accepted these provisions must apply this increased amount when paying benefits to eligible children of accidental disability retirees and accidental death survivors, with no further action needed for boards that have not adopted these sections.

PERAC Memo #42/2012 addresses amendments (Section 58, Chapter 118 of the Acts of 2012) to the same-sex marriage Option C election provisions originally established under Chapter 176 of the Acts of 2011. The change eliminates boards' discretion to require lump-sum repayment of overpayments, instead guaranteeing members the right to a repayment plan of up to 5 years, with the possibility of an even longer term subject to board approval. Boards must notify any members currently repaying overpayments under a shorter plan of their right to extend to 5 years or petition for a longer term; all other provisions of the 2011 law and PERAC Memo #40 remain unchanged.

PERAC Memo #43/2012 explains that Chapter 139 of the Acts of 2012 (Sections 63-65) created a new local option allowing retirement boards to raise the G.L. c. 32, §101 survivor benefit for widows/widowers of disabled public employees to $12,000 annually, building on the prior $6,000 statutory benefit and the $9,000 supplemental option from 2010. Boards wishing to adopt this increase must vote to accept it, obtain approval from their local legislative body, and file certification of these votes with PERAC before the increase takes effect (this may be done at any time); absent such acceptance, the benefit remains at $6,000 or $9,000 as previously adopted. Note that the State Teachers' and State Employees' Retirement Systems are deemed to have already accepted this option effective July 1, 2012, requiring no further action from those systems.

PERAC Memo #44/2012 announces the release of an interactive Excel worksheet (with instructions) designed to help retirement boards calculate whether a member's regular compensation triggers the anti-spiking provisions under Sections 14 and 18 of Chapter 176 of the Acts of 2011. Boards must now attach this worksheet (or an equivalent showing both Section 14 and 18 calculations) to every superannuation, ordinary disability (non-veteran), and member-survivor allowance calculation submitted to PERAC—submissions lacking it will not be processed—and boards with waivers must retain the completed worksheet in members' files, as unsupported assertions of "no spiking" are no longer acceptable.

PERAC Memo #45/2012 transmits an updated Tobacco Company List (July 2012), which replaces all prior lists and identifies companies deriving more than 15% of revenue from tobacco sales, in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must distribute the list to their investment advisors (restricted to use for Massachusetts public fund clients only) and ensure portfolio compliance, including with pooled funds assessed on a look-through basis; any non-compliant holdings must be divested prudently, in consultation with PERAC before action is taken.

PERAC Memo #46/2012 addresses whether retirement boards must complete the full anti-spiking worksheet when it is already evident that a member's regular compensation qualifies for one of the recognized exceptions (e.g., collectively bargained raises). PERAC clarifies that boards need not complete the worksheet in such cases, but must still verify and document that the compensation was reviewed for spiking and identify which exception applies. Boards are required to retain all supporting documentation in the member's file for potential future review by the calculation unit or during an audit.

This memo provides a quarterly update on the mandatory 18-hour training requirement for retirement board members under Ch. 176 of the Acts of 2011, reminding boards that 2012 completion forms are due to PERAC by January 31, 2013 (with PERAC issuing status reports by March 1, 2013), and that failure to meet the requirement bars a member from continuing to serve beyond their current term. Boards must distribute the forthcoming PERAC statement-of-completion forms to their members and should encourage any members who have not yet met the minimum 2012 credit requirement to attend qualifying programs (e.g., MACRS Conference sessions, State Ethics Commission seminars, PERAC Disability Training) before year-end.

**PERAC Memo #48/2012** requests that retirement boards submit data needed to calculate FY14 appropriation amounts owed by governmental units under G.L. c.32, §22D, §22(6A)(b), or §22F. Boards must complete and return the attached appropriation questionnaire (preferably via PERAC's website) **no later than October 31, 2012**, and should also confirm that a funding schedule has been submitted for PERAC approval within the past three years, contacting PERAC if an update is needed.

PERAC Memo #49/2012 continues the Commission's review (begun in Memo #27/2012) of how Chapter 176 of the Acts of 2011 affects existing PERAC investment regulations and guidelines, providing a summary chart of the impact on each provision reviewed. It reiterates that boards must invest through PRIT or an employed investment manager consistent with the amended Chapter 32, §23 restrictions (tobacco, South Africa/Northern Ireland, no direct mortgage/collateral loan investments) and the fiduciary duty standard under §23(3); PERAC notes further guidance on hedge fund investment and indemnification is still forthcoming. No immediate board action is required beyond reviewing the attached summary and ensuring investment practices conform to the revised statutory framework.

PERAC Memo #50/2012 transmits an updated Tobacco Company List (October 2012), which supersedes all prior lists and identifies companies from which retirement boards are prohibited from making new investments under Chapter 119 of the Acts of 1997 (companies deriving more than 15% of revenue from tobacco sales, including pooled funds meeting this threshold). Boards must apply this list immediately, forward it to their investment advisors for Massachusetts public fund use only, and ensure no prohibited purchases occur after January 13, 1998; any portfolio found out of compliance during a PERAC audit must be divested prudently after consultation with PERAC.

PERAC Memo #51/2012 clarifies the requirements of G.L. c. 32, §23B, which mandates that contracts with investment service providers include specific fiduciary, disclosure, and indemnification terms: providers must be designated fiduciaries, must annually disclose compensation arrangements and conflicts of interest to the board and PERAC, and contracts may not contain provisions indemnifying the contractor by the retirement board. The memo explains how these requirements apply particularly to complex structures like partnership/trust agreements (e.g., general partners in limited partnerships) where the "contractor" and indemnification language must be carefully identified. **Action required:** Boards must review and ensure all investment service contracts—including partnership and trust agreements—comply with §23B's fiduciary, disclosure, and no-indemnification requirements, and should consult legal counsel to properly apply these terms to non-standard investment vehicles.

This memo reminds retirement board members of the Chapter 176 requirement to complete 18 hours of training per term, and notes that PERAC will send each member a 2012 educational credit summary before December 31, 2012. Boards should ensure any completed but unreported training—specifically the State Ethics Commission's Conflict of Interest Law seminar and the Inspector General's online Bidding Basics course—is submitted to PERAC immediately so credit records are accurate.

PERAC Memo #53/2012 reminds boards of the G.L. c. 32, §12D requirement that inactive, non-retired members who turn age 70½ must begin receiving a distribution by April 1 of the following year, and provides a sample notification letter for use with affected members. Boards should send these notices—recommended in December with a March 1 response deadline—urge members to seek counseling given the complexity of rollover options, and follow up with non-respondents to ensure timely processing before the April 1 deadline; boards may also wish to proactively notify members at age 69.

PERAC Memo #54/2012 reminds retirement boards that all "investment service providers" (managers, consultants, custodians, trusts, proxy/litigation services, and related vendors) must file annual disclosure forms with both the board and PERAC by January 1 of each year, and as part of any RFP process, per c. 32 §23B and 840 CMR 17.04(7)-(8). Disclosures must cover compensation arrangements (paid or received, directly or indirectly) related to services provided to the board or any other client, as well as any potential conflicts of interest. Boards are asked to forward this notice to their vendors to ensure compliance and confirm required disclosures are filed on time.

**PERAC Memo #55/2012 Summary** This memo transmits a Governmental Plan Alert from Ice Miller (PERAC's tax counsel), issued November 2, 2012, addressing the importance of proper coding for Form 1099-R reporting. Boards should review this time-sensitive guidance promptly and read it in conjunction with PERAC's Taxation and Reporting Requirements Workbook and Form 1099-R Overview (issued December 2011 under Memo #44/2011) to ensure accurate 1099-R distribution coding practices.

PERAC Memo #56/2012 transmits the updated Tobacco Company List (dated January 2013), which replaces all previously issued lists and takes effect immediately upon receipt. Boards must ensure their investment advisors have and use this current list to comply with the statutory prohibition (M.G.L. c. 32 restrictions under Chapter 119 of the Acts of 1997) against new investments in companies deriving more than 15% of revenue from tobacco sales—including pooled funds meeting that threshold—and must consult with PERAC before divesting to bring any noncompliant holdings into compliance.

PERAC Memo #57/2012 requests that retirement boards review and update PERAC's disability retiree database, reflecting deaths, nursing home confinements, allowance waivers, returns to active status, and address changes that occurred during 2012. Boards must also complete the "New Member Data" form for any new accidental or ordinary disability retirees approved in 2012 and help contact members who have not responded to the Affidavit Waiver (noting that non-respondents must file a 2012 Annual Statement of Earned Income). All information is due to PERAC by **January 15, 2013**, to ensure database accuracy before the 91A mailing in late February.

This memo reminds boards that Chapter 32 requires all retirement board members to complete mandatory training annually, with roughly 500 members having met the 2012 requirement; failure to meet this requirement disqualifies a member from continuing beyond their current term. It clarifies PERAC's approach to awarding credits—including pre-approval for third-party programs (e.g., ethics or open meeting law sessions embedded in broader conferences)—and details the three-hour credit available for State Ethics Commission Public Education Seminars on the Conflict of Interest Law (distinct from the separate online ethics quiz requirement, which earns no PERAC credit). **Action required:** Boards should ensure members obtain their annual training credits, seek PERAC pre-approval for non-standard training events in advance where possible, and submit Certificates of Attendance from State Ethics Commission seminars to receive credit; the 2013 seminar schedule is provided to facilitate scheduling.

PERAC Memo #59/2012 explains that Chapter 176's changes to superannuation post-retirement earnings limits indirectly affect disabled retirees under Section 91A: total earnings (public and private combined) are limited to $5,000 above the current salary of the position from which the retiree retired, and public sector employment remains capped at 960 hours annually. Boards should use the updated interactive Earned Income Worksheet (posted on PERAC's website) to calculate allowable earnings for disabled retirees returning to work.

PERAC Memo #60/2012 addresses the annual review of the medical testing fee under 840 CMR 10:10(3) and 10:15(4), which caps the cost of non-invasive medical tests the Commission will fund without prior approval when suggested by a Regional Medical Panel during disability evaluations. At its December 10, 2012 meeting, the Commission voted to maintain the existing $100.00 per-case limit that PERAC staff may approve for such testing. No action is required by boards, as this is informational; boards should simply be aware that testing costs exceeding $100.00 require advance PERAC approval.

This memo announces PERAC's annual review of the non-invasive medical testing fee cap under 840 CMR 10:10(3) & 10:15(4), confirming the Commission voted on December 13, 2010 to maintain the existing practice of authorizing PERAC staff to approve up to $100.00 per case for non-invasive medical tests ordered by Regional Medical Panels. No action is required by retirement boards; this is informational, noting that any testing costs exceeding $100.00 still require advance Commission approval.

This memo announces that PERAC has set the "regular interest" rate under G.L. c. 32, §22(6)(b) at 0.2% for calendar year 2011, based on average savings account rates from a sample of financial institutions. Boards must apply this 0.2% rate to accumulated total deductions and accrued interest when crediting interest for 2011 refunds and retirements, and also credit it on December 31, 2011 for outstanding balances as of December 31, 2010.

This memo provides the 2011 IRS Section 401(a)(17) compensation cap ($245,000, or $360,000 for members who joined prior to 12/31/95) and Section 415 annual benefit limit ($195,000 at age 65, reduced for earlier retirement)—both unchanged from 2010—under Chapter 46 of the Acts of 2002. These limits affect only the highest-paid members, so no action is required for most boards or members; boards should apply these figures when calculating benefits for affected high earners and contact PERAC's actuary with questions.

This memo notifies boards that the Social Security COLA for the year was 0.0%, which sets the base COLA rate under Section 103(c) effective July 1, 2011. Boards may vote at a duly called meeting to grant a higher COLA (up to 3.0%) under Section 103(i), provided they give proper notice to their legislative body; regardless of the decision, each board must notify PERAC of its COLA determination within 30 days.

PERAC Memo #05/2011 provides retirement boards with updated instructions, worksheets, and the cumulative interest factor sheet for calculating buyback and make-up repayments using buyback interest for calendar year 2011, applicable under the specified G.L. c. 32 sections. Boards should use these updated worksheets and factor sheet—rather than prior versions—for all buyback/make-up calculations going forward, consistent with guidance in Memos #13/2005 and #28/2008.

This memo requests that all retirement boards submit active member, retiree/survivor, and disability retiree data as of December 31, 2010, in standard PERAC record format by March 31, 2011. Boards should expect data analysis reports afterward to review and correct any errors or warnings, supporting sound data maintenance for reliable actuarial valuations. Boards already scheduled for a 2011 PERAC actuarial valuation should have received a separate, specific data request.

This memo announces PERAC's requirements for preparing the Calendar Year 2010 Annual Statement, distributed via CD along with sample statements and preparation guides, and notes updates related to 3% interest on refunds, ERI funds, and Buyback agreement accounting. Boards must complete and return the signed Annual Statement to PERAC by May 1, 2011, and submit their pre-closing cashbook and trial balance for December 2010 prior to February 28, 2011. Boards are also encouraged (though not required) to sign up for the seminar or request the CD presentation for training assistance.

PERAC Memorandum #08, 2011 provides the updated quarterly list (as of 12/31/10) of investment managers previously granted exemptions under 840 CMR 19.01 for international equity, international fixed income, real estate, and alternative investment asset classes, limited to funds/managers still open to new investors. Boards do not need to seek a new exemption when hiring a manager already on this list, but must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form, and receive PERAC's acknowledgement before transferring funds; boards may also hire non-listed managers by requesting a separate exemption. No exemption is required for domestic equity or fixed income managers—only the three forms noted above apply.

PERAC Memo #09/2011 transmits the updated (January 2011) Tobacco Company List, which supersedes all prior lists and takes effect immediately upon receipt, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are barred from making new investments under Chapter 119 of the Acts of 1997. Boards must distribute the list to their investment advisors (noting it is restricted to use for Massachusetts public fund clients only), and should be aware that PERAC will review portfolios during audits for compliance—including pooled funds assessed on an aggregate basis—and that any board found holding a prohibited investment must consult with PERAC before divesting in a prudent manner.

PERAC Memorandum #10 (2011) introduces a new video-based training tool—a DVD presentation by Chief Auditor Harry Chadwick and Deputy Chief Auditor Jim Tivnan explaining how to prepare the 2010 Annual Statement, including a checklist and table of contents for reference. This video supplements, but does not replace, the in-person training sessions being held at PERAC and West Springfield in February 2011. No mandatory action is required of boards, though staff involved in preparing the Annual Statement may benefit from viewing the DVD or attending a live session.

**Summary:** This memo requests that all retirement boards assist PERAC in compiling data for its 2010 Annual Report by verifying/updating three items: (1) board contact information and membership as of December 31, 2010; (2) the list of investment managers, custodian, and consultant retained as of December 31, 2010, noting any name changes, terminations, or liquidations; and (3) the board's Target Investment Rate of Return based on current asset allocation. **Action required:** Boards must review, annotate/correct, and return the data sheet, manager/custodian/consultant list, and calculated Target Investment Rate of Return to Rose Cipriani at PERAC by **February 22, 2011**, even if no changes are needed (in which case the materials should simply be marked "correct" and returned).

PERAC Memorandum #12/2011 establishes the 2011 regular compensation cap for members who joined a retirement system after January 1, 2011, calculated as 64% of the IRC 401(a)(17) federal compensation limit ($245,000), resulting in a cap of $156,800. Boards must apply this $156,800 limit when determining regular compensation for retirement purposes for these new members in calendar year 2011, and may direct any questions to PERAC's Actuary, Jim Lamenzo.

This memo reminds boards of the process under G.L. c. 32, §103(j) for increasing a system's COLA base (a board vote by majority, followed by legislative body approval), as previously summarized in PERAC Memo #33/2010. It emphasizes that an increase is not effective until certification of both the board vote and legislative body approval is filed with PERAC—so boards that have taken steps to increase their COLA base but have not yet filed certification should do so promptly to make the change effective.

This memo summarizes the SJC's decision in Boston Housing Authority v. NCFO (2010), which invalidated automatic "evergreen clause" extensions of collective bargaining agreements beyond the three-year term set by G.L. c. 150E, §7(a), while still permitting bridge agreements negotiated after expiration. PERAC flags that this ruling may impact Section 23 of Chapter 21 of the Acts of 2009 (the regular compensation "grandfathering" provision tied to CBAs in effect on May 1, 2009): members whose CBA coverage on that date relied solely on an evergreen clause—rather than an actual contract term or bridge agreement—may not qualify for continued regular compensation treatment through June 30, 2012. Boards should carefully review affected members' CBA status as of May 1, 2009 when determining regular compensation eligibility, and monitor the pending Picone v. City of Leominster appeal, which addresses this issue directly.

This memo announces PERAC's initiation of the process to revise its Investment Regulations, consolidating existing guidance (e.g., Hedge Fund Guidelines, Placement Agent Policy, Mandate Modification, and Futures/Options rules) into formal regulation, updating procurement requirements, and removing outdated provisions. The draft is not final—public hearings and a comment period will follow before any changes are adopted—so boards need not take immediate action but should monitor the process and may wish to submit comments or attend hearings.

PERAC Memo #16/2011 clarifies that lump-sum payments of a deceased member's annuity account balance to a named beneficiary under G.L. c. 32, §9 (accidental death) or §100 remain taxable, despite confusion arising from a presentation at the MACRS conference. After consulting special tax counsel, PERAC confirmed there is no legal basis to treat these payments as non-taxable under IRC §104(a)(1), since they are determined by reference to the member's prior contributions. Boards should continue to treat these lump-sum annuity payments as taxable and may refer to PERAC Memo #34/1992 for further guidance; no other action is required.

PERAC has adopted draft regulations overhauling investment, bookkeeping, and procurement rules for retirement systems—codifying past guidance (e.g., Hedge Fund Guidelines, Placement Agent Policy, Mandate Modification, Futures/Options use) while updating outdated provisions and adding procurement requirements. Boards should review the draft regulations and summary on PERAC's website and may attend one of the scheduled public hearings (May–June 2011) or submit written comments by the July 1, 2011 deadline before final regulations are filed with the Legislature. No immediate compliance action is required beyond optional participation in the comment process.

This memo (PERAC Memo #18, 2011) transmits the updated, PERAC-maintained list of investment managers/funds in international equity, international fixed income, real estate, and alternative investments that have previously received exemptions under 840 CMR 19.01 and remain open to new investors. Boards hiring a manager already on this list do not need to seek a new exemption, but must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form and receive PERAC acknowledgement before transferring funds; boards may also still pursue exemptions for managers not on the list, and no exemption is needed at all for domestic equity/fixed income hires. No other action is required beyond noting the quarterly-updated list, available on PERAC's website.

This memo transmits PERAC's updated Tobacco Company List (dated April 2011), which replaces all previous versions and identifies companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under M.G.L. c. 32, as established by Chapter 119 of the Acts of 1997. Boards must ensure their investment advisors receive or access this list (noting it is restricted to use for Massachusetts public fund clients only), and if a PERAC audit reveals non-compliant holdings—including in pooled funds meeting the 15% threshold—the board must divest prudently after consulting with PERAC.

PERAC Memorandum #20, 2011 transmits the 2009 Retirement Board Professional Services Report, compiled from data reported in boards' Annual Statements, to serve as a reference tool for comparing vendor fees and services. While PERAC takes no position on any listed vendor, boards are reminded of their fiduciary duty to periodically review vendor contracts and conduct open, competitive selection processes; no other specific action is required beyond this ongoing best-practice obligation.

PERAC Memo #21, 2011 announces an update to the "Notice of Potential Benefits Pursuant to G.L. c. 32, § 4(1)(h)" form, revised to remove references to the "Massachusetts" National Guard, consistent with the 2005 statutory amendment allowing members of any state's National Guard (not just Massachusetts) to purchase past veteran's service credit if otherwise eligible. Boards should begin using this updated form going forward to ensure accurate notice of benefits to members with National Guard service.

PERAC Memo #22/2011 announces the updated Application for Reinstatement to Service form under G.L. c. 32 §105, effective July 1, 2011–June 30, 2012. Boards should use this revised form when members seek reinstatement from superannuation/termination retirement, carefully counsel members on the significant repayment obligations and five-year full-time employment requirement, complete the initial portion of the form, and contact PERAC's actuarial unit if a needed investment return assumption factor is not listed.

PERAC Memo #23, 2011 announces the annual cost-of-living adjustment to the supplemental dependent allowance under G.L. c. 32, §§ 7(2)(a)(iii), 22D, and 9(2)(d)(ii), raising the per-child annual payment to $751.80 effective July 1, 2011. Boards that have accepted these provisions must update payments to eligible children of accidental disability retirees and accidental death survivors accordingly; questions should be directed to PERAC actuary Jim Lamenzo.

This memo reminds boards of two recurring compliance obligations for board members and staff: (1) mandatory Ethics Commission training under G.L. c. 268A, due biennially by April 2 (within 30 days for new members/staff), and (2) Open Meeting Law materials distribution and certification requirements, requiring each member to sign a Certificate of Receipt within two weeks of election/appointment and biennially by January 14. Boards should ensure all current and incoming members/staff complete both the Ethics training and the Open Meeting Law certification on schedule, using the resources linked from the Ethics Commission and Attorney General websites.

PERAC Memo #25/2011 transmits an updated Tobacco Company List (dated July 2011) that supersedes all prior lists, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards must forward the list to their investment advisors (or notify them it is on the PERAC website), ensure no prohibited purchases occur (including in pooled funds assessed at the pool level), and, if a portfolio is found out of compliance during a PERAC audit, consult with PERAC before divesting in a prudent manner.

Memorandum #26 (2011) requests that all retirement boards submit appropriation data needed for PERAC to calculate FY13 governmental unit appropriations under G.L. c.32, §22D, §22(6A)(b), or §22F. Boards must complete and return the appropriation questionnaire (preferably online) by October 31, 2011, and should also confirm their funding schedule has been resubmitted to PERAC for approval within the last three years, contacting PERAC if an update is needed.

This memo announces PERAC's new pension fraud prevention poster campaign, which introduces a dedicated email address (PensionFraud@per.state.ma.us) for reporting suspected pension fraud in addition to the existing toll-free hotline (1-800-445-3266). Boards should display the enclosed posters prominently in their offices, distribute the accompanying brochures and "Referral Report of Potential Fraud" forms as needed, and ensure staff use these forms to report suspected fraud to PERAC's Fraud Unit.

This memo reminds boards of the G.L. c. 32 §91(b)-(c) limits on post-retirement public employment—retirees may not work more than 960 hours per calendar year or earn compensation that, combined with their retirement allowance, exceeds the current salary of the position from which they retired. Boards should note that while employers and retirees bear primary responsibility for monitoring and certifying hours/earnings, courts have held that a retirement board may recoup excess payments if the employer fails to do so; PERAC has provided an Excel worksheet to assist boards, employers, and retirees in tracking compliance.

This memo transmits an updated Tobacco Company List (dated July/October 2011), which supersedes all prior lists and identifies companies deriving more than 15% of revenue from tobacco sales, in which retirement systems are barred from making new investments under Chapter 119 of the Acts of 1997 (applied also to pooled funds exceeding the 15% threshold). Boards must forward the list to their investment advisors (or direct them to it on PERAC's website), noting it is restricted to use for Massachusetts public fund clients only. Since PERAC will audit portfolios for compliance, boards should review current holdings against this list and, if any prohibited investments are found, must consult with PERAC before prudently divesting to come into compliance.

This memo addresses shift substitution practices (common in public safety departments) and clarifies that regular compensation and creditable service under G.L. c. 32 may only be granted for time actually worked—collective bargaining agreements allowing shift swaps without regard to who actually performed the work cannot override these statutory requirements. Boards must ensure that when shift substitution occurs, records accurately reflect which employee actually worked the shift, so that creditable service and regular compensation are credited only to the member who performed the work, not to the member who was nominally scheduled but did not work.

This memo summarizes the Attorney General's regulations (940 CMR 29.10) permitting remote participation at public meetings, and explains how retirement boards may adopt this practice by simple majority vote. No action is required, but if a board chooses to allow remote participation, it must follow specific procedural requirements: a physical quorum (including the Chair or authorized substitute) must be present, remote participation is limited to specified reasons (illness, disability, emergency, military service, or geographic distance), all votes must be by roll call, and detailed documentation of the reason and procedures must be reflected in the minutes.

This memo reminds boards of the G.L. c. 32, §12D requirement that non-retired, non-employed members who reach age 70½ must begin receiving distributions by April 1 of the following year, and provides a sample notification letter boards can send to affected members. Boards should mail notices (recommended in December, with a March 1, 2012 response deadline for 2010 age-70½ attainees) urging members to contact the board for counseling rather than sending full form packets, follow up with non-responders, and may also consider proactively notifying members at age 69 to help ensure timely compliance and optimal rollover options.

**Memorandum #33, 2011 – Regular Compensation** This memo consolidates guidance on determining "regular compensation" for retirement purposes following Chapter 21 of the Acts of 2009, the amended 840 CMR 15.03 regulations, and relevant case law (Pelonzi and O'Brien decisions). It provides retirement boards with consolidated lists of characteristics that make payments includable (e.g., base salary, non-discretionary payments for services) versus excludable (e.g., overtime, bonuses, in-kind payments, severance) from regular compensation calculations. Boards should apply this framework when reviewing compensation determinations for members retiring on or after July 1, 2009, though no new filing or reporting action is required beyond ensuring compliance with existing law when calculating regular compensation.

This memo announces PERAC's new Placement Agent Policy, adopted after public hearing in response to Pension Reform legislation, which requires investment managers to disclose detailed information about any placement agents used in connection with investment by Massachusetts public pension systems (compensation, agreements, qualifications, registrations, and any board/staff connections). Boards must ensure managers provide this disclosure information to both the board and PERAC before/during RFP responses, contract amendments, or substantive discussions with managers, and should expect PERAC to issue standardized forms for compliance before January 1, 2012.

This memo introduces the governance-related provisions of Chapter 176 of the Acts of 2011 (Pension Reform and Benefit Modernization), covering investment oversight changes, board member eligibility/education/disclosure requirements, procurement reform, and enforcement measures, with a separate memo to follow on benefit-structure provisions. Most governance provisions take effect February 16, 2012; boards should note that PERAC will no longer issue individual investment manager exemptions/waivers but will instead require submission of procurement documentation, vendor and board member certifications, and consultant reports for acknowledgement before proceeding with investments or consultant retention. Boards should review the new law closely and prepare to comply with new eligibility rules (e.g., prohibiting service by employees/vendors receiving outside remuneration) as further PERAC guidance and forms are issued.

PERAC Memorandum #37, 2011 directs retirement boards to transition from mailing diskettes/CDs to using the Commonwealth's Secure File and E-mail Delivery (SFED) system for transmitting actuarial data (member, retiree, and disability files) to protect personally identifiable information. Boards must submit the name, title, phone number, and email address(es) of staff responsible for these transmissions to John Boorack by December 31, 2011, so PERAC can issue SFED account setup invitations.

This memo announces the new mandatory training requirement under Chapter 176 of the Acts of 2011 (M.G.L. c. 32, §20(7)), which takes effect in 2012 and requires each retirement board member to complete 18 hours of training over their term, with a minimum of 3 and maximum of 9 hours creditable per year. Boards must distribute PERAC's statement-of-completion forms to members, ensure members submit completed forms documenting 2012 training to PERAC by January 31, 2013, and be aware that failure to meet the requirement bars a member from serving beyond the end of their term. PERAC has scheduled initial 2012 training sessions (covering fiduciary responsibility/annual statement training and ethics) that boards should make available to their members.

Memorandum #39 (2011) provides guidance on implementing Chapter 176's Section 23B contract requirements, directing boards to review all existing vendor contracts for investment, actuarial, legal, and accounting services to ensure compliance by the February 16, 2012 effective date. Boards should confirm that written contracts have defined terms not exceeding five years (including renewals/extensions); contracts already meeting this standard remain valid until expiration, but any contract lacking a term—or exceeding five years—must be amended or rebid through a new procurement process before the deadline to avoid violating the statute. The memo also reminds boards that non-listed services (e.g., software, medical, investigative) remain subject to the general prudent expert fiduciary standard rather than Section 23B's specific procurement process.

This memo explains Section 55 of Chapter 176 of the Acts of 2011, which allows retirees who retired before May 17, 2004, chose Option A or B, and entered a same-sex marriage between May 17, 2004 and May 17, 2005 (or their surviving spouses) to make a one-time, irrevocable change to Option C. Boards must promptly notify all potentially eligible retirees and surviving spouses of this option, since elections must be made by July 1, 2012 (effective February 16, 2012), implement approved changes within 180 days, and arrange for repayment of any resulting overpayments. Boards should also make reasonable efforts to locate eligible surviving spouses through the deceased retiree's estate or next of kin.

This memo reminds boards that under the 2009 Ethics Reform law, all Board Members and staff (and certain contracted personal-service providers) qualify as municipal employees subject to G.L. c. 268A conflict-of-interest requirements. Boards must annually distribute the Ethics Commission's Summary of the Conflict of Interest Law (with signed acknowledgments retained on file and copies sent to appointing authorities), and ensure all covered individuals complete the online ethics training by April 2, 2012 and every two years thereafter, retaining completion certificates for six years; new members/employees must receive the Summary and complete training within 30 days of joining.

PERAC Memorandum #42, 2011 requests that retirement boards update their disability retiree records to ensure PERAC's database accurately reflects post-retirement earnings limits. Boards must review the attached list of disability retirees and report any 2011 status changes (death, nursing home confinement, waiver of allowance, return to active status, or address changes), and complete a "New Member Data" form for any new disability retirees approved in 2011. All updates are due to PERAC by January 17, 2012, to ensure accuracy before the 2011 Annual Statements of Earned Income (91A) are mailed at the end of February.

This memo announces PERAC's annual review of the medical testing fee cap under 840 CMR 10:10(3) and 10:15(4), which governs reimbursement for non-invasive medical tests ordered by Regional Medical Panels during disability evaluations. At its December 12, 2011 meeting, the Commission voted to continue past practice, maintaining the $100.00 per case cap that PERAC staff may approve without further Commission review. No action is required of boards, as this is informational, though boards should be aware that any test costs exceeding $100 require advance Commission approval.

PERAC Memorandum #44/2011 transmits a Taxation and Reporting Requirements Workbook and a 1099R overview chart, prepared by PERAC's Tax Counsel, to assist boards in preparing IRS Form 1099R for members and beneficiaries. The memo notes that certain unresolved tax treatment issues flagged in the Workbook will be addressed through a forthcoming Private Letter Ruling request to the IRS, with updates to follow. Use of these materials is optional—boards are not required to adopt them—but they are offered as guidance for boards and their vendors.

PERAC Memo #01/2010 provides the annual update on IRS Code Section 401(a)(17) compensation limits and Section 415 benefit limits under Chapter 46 of the Acts of 2002, which only affect the highest-paid retirement system members. For 2010, these limits remain unchanged from 2009 ($245,000 compensation limit, or $360,000 for members who joined prior to 12/31/95; $195,000 benefit limit at age 65, reduced for earlier retirement). No board action is required beyond applying these limits where applicable; questions should be directed to PERAC Actuary Jim Lamenzo.

This memo notifies boards that, per the required annual COLA report under Ch. 17, §8(c), the Social Security Administration's CPI-W-based COLA is 0.0%, making the statutory Chapter 32, §103(c) COLA effective July 1, 2010 also 0.0%. Boards may elect, after proper notice to their legislative body and a duly called meeting, to grant a COLA up to 3.0% under §103(i), and each board must notify PERAC of its decision within 30 days.

This memo clarifies that when a Board Member uses paid leave to attend Board business and the employer incurs replacement/substitute costs (rather than the Member losing wages), the retirement board may reimburse the employer, capped at the wages the Member would have earned for that shift. Boards should try to schedule meetings around Members' work schedules to minimize such costs, and any employer reimbursement must be fully documented and specifically approved by the Board in advance, with the affected Member abstaining from discussion and voting on the matter.

This memo requests that all retirement boards submit active member, retiree/survivor, and disability retiree data as of December 31, 2009, in PERAC's standard record format by March 31, 2010. Boards will receive data analysis reports afterward to review and correct any questionable items, and PERAC recommends sound data maintenance practices to ensure reliable, timely actuarial valuations. Boards scheduled for a 2010 PERAC actuarial valuation should already have received a separate data request.

This memo transmits PERAC's updated (as of 12/31/09) quarterly list of investment managers previously granted exemptions under 840 CMR 19.01 in international equity, international fixed income, real estate, and alternative investments asset classes. Boards may hire managers from this list without seeking a new exemption, but must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form, and receive PERAC acknowledgement before transferring funds; no exemption or listing applies to domestic equity/fixed income managers, and boards may still pursue exemptions for managers not on the list.

This memo transmits PERAC's updated Tobacco Company List (December 2009), which supersedes all prior lists and implements Chapter 119 of the Acts of 1997 prohibiting new retirement system investments in companies deriving more than 15% of revenue from tobacco sales. Boards must forward the list to their investment advisors (noting it applies only to Massachusetts public fund clients), ensure portfolio compliance—including for pooled funds assessed at the pool level—and consult with PERAC before divesting if any non-compliant holdings are identified during audit review.

This memo announces the 2009 Annual Statement preparation cycle, distributed via CD along with a sample statement and preparation guide, and notes a seminar covering changes tied to updates in PERAC's Accounting Manual, with auditors available for one-on-one assistance. Boards must submit their pre-closing cashbook and trial balance for December 2009 by February 28, 2010, and complete, sign, and return the Annual Statement to PERAC by May 1, 2010; boards are also asked to RSVP for the seminar using the enclosed sign-up sheet.

PERAC Memorandum #08/2010 transmits updated buyback and make-up repayment worksheets, instructions, and the cumulative interest factor sheet for calendar year 2010, to be used for calculating creditable service buybacks/make-ups under the various G.L. c. 32 provisions referenced in Memos #13/2005 and #28/2008. Boards should use these updated 2010 worksheets/interest factors (rather than prior years' versions) when computing member buyback and make-up payments going forward, and may contact John Boorack with questions.

This memo announces that PERAC has set the "regular interest" rate under G.L. c. 32, §22(6)(b) at 0.3% for calendar year 2010, based on average savings rates from a sample of financial institutions. Boards must apply this 0.3% rate to accumulated total deductions and accrued interest when crediting interest for refunds and retirements processed during 2010, and also apply it to outstanding balances as of December 31, 2009, when crediting interest on December 31, 2010.

This memo clarifies implementation of the "Under $5000 Rule" (G.L. c. 32, §4(1)(o)), which excludes creditable service (but not membership) for employees earning under $5,000 annually as of July 1, 2009. Boards should consider adopting a supplemental regulation under §3(2)(d) to exclude future part-time/low-earning employees and elected officials from membership going forward, but for current members already in service, boards must continue withholding retirement deductions from their compensation even though that service will not count as creditable service, since membership status is unaffected by this statute.

PERAC advises boards that the IRS has issued a "checksheet" requesting additional information related to the pending group Determination Letter request, and that some boards have received this document directly via fax (addressed to tax counsel Mary Beth Braitman with a copy to the board). Boards should take no action themselves—PERAC's tax counsel (Ice Miller) will respond to the IRS on behalf of all boards by the February 13, 2010 deadline—and should simply file the document with their records, as all 105 Massachusetts retirement boards are expected to receive similar correspondence.

This memo requests that retirement boards assist PERAC in compiling data for its 2009 Annual Report by verifying board contact/membership information (as of 12/31/2009), confirming the accuracy of their list of investment managers, custodian, and consultant, and calculating/reporting their Target Investment Rate of Return. Boards must annotate and return the data sheet and manager/custodian/consultant list (marking "correct" if no changes are needed), along with the target rate of return, to PERAC by February 16, 2010.

PERAC Memo #13/2010 reminds retirement boards that all board members and staff, as municipal employees under G.L. c. 268A, must complete the state Ethics Commission's online ethics training by April 2, 2010, and recertify every two years, with new members/employees completing it within 30 days of appointment or hire. Boards must retain completion certificates for six years, forward copies to appointing authorities (for non-elected members), file certificates with the appropriate municipal/district clerk or retain them if the system covers multiple governmental units, and—if the board itself holds the records—designate a senior liaison to the Ethics Commission and notify the Commission of that designation (and any subsequent changes).

This memo updates boards on the IRS Voluntary Compliance Program (Cycle C) process, noting that the IRS approved PERAC's adoption of compliance regulations (effective December 11, 2009) as satisfying federal law update requirements for local retirement systems, and that IRS review of individual determination letter applications is now underway with a single assigned agent. Boards need not take any action or respond directly to IRS inquiries regarding their determination letter applications, as PERAC's counsel is coordinating all responses on behalf of the local systems.

This memo addresses reimbursement calculations under G.L. c. 32, §3(8)(c) for members with prior service in multiple systems, noting that disparate compensation rates across systems can create inequitable reimbursement amounts between boards. PERAC will now review and respond to recalculation requests promptly, with any adjustments effective as of the request date, and will also offer, where amounts are not substantial and both boards agree, to calculate a one-time actuarial equivalent lump sum in lieu of annual reimbursement payments. Boards seeking recalculation or lump-sum settlement should submit requests to PERAC (Actuary James Lamenzo) directly.

This memo revises the retroactivity policy for §3(8)(c) reimbursement recalculations announced in Memorandum #15/2010. PERAC now clarifies that if a board requests recalculation within 3 months of receiving the initial §3(8)(c) reimbursement letter, the modified amount will be retroactive to the member's date of retirement; if the request is made more than 3 months after that letter, the modified amount will only be prospective from the date PERAC receives the request. Boards should note this timeline and submit recalculation requests promptly—within 3 months of receiving an initial §3(8)(c) letter—to preserve full retroactive reimbursement for affected members.

Memorandum #17 (2010) reminds boards that Massachusetts public retirees returning to public employment—whether as employees, consultants, or independent contractors—remain subject to the § 91(b)/(c) earnings and hours limitations (960 hours/calendar year and earnings capped at the difference between the retiree's allowance and the current salary of the position from which they retired). It clarifies that monitoring responsibility rests with the employer and retiree, that boards may recoup excess payments if employers fail to do so (per Flanagan v. CRAB), and it introduces a new PERAC Post-Retirement Earnings Worksheet to help boards, employers, and retirees track and enforce compliance. Boards should begin using this worksheet and ensure employers are certifying retirees' hours/earnings to prevent limit violations.

This memo transmits PERAC's quarterly-updated list (as of 3/31/10) of investment managers previously granted exemptions under 840 CMR 19.01 in international equity, international fixed income, real estate, and alternative investment asset classes. Boards may hire managers already on this list without seeking a new exemption, but must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form and receive PERAC acknowledgement before transferring funds; boards remain free to pursue exemptions for managers not on the list, and no exemption is needed at all for domestic equity/fixed income hires.

This memo transmits the updated March 2010 Tobacco Company List, which supersedes all prior lists and is effective immediately, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997 (this restriction applies to pooled funds as well, if the pool as a whole exceeds the 15% threshold). Boards must share this list with their investment advisors (noting it is restricted to use for Massachusetts public fund clients only), and if a PERAC audit finds non-compliant holdings, the board must divest in a prudent manner after consulting with PERAC before taking action.

This memo announces that PERAC staff have received new @MassMail.State.MA.US e-mail addresses (in addition to their existing 2005 addresses, which remain valid) and introduces the Secure File and E-mail Delivery (SFED) application for exchanging sensitive information securely. Boards should note that only the older @per.state.ma.us addresses work with SFED, and should continue sending appropriation questionnaires/pooled fund statements to the original addresses; no immediate action is required beyond updating contact references and awaiting forthcoming SFED protocols.

This memo announces PERAC's implementation of a policy allowing prospective modification (suspension) of disability retirement allowances under G.L. c. 32, §8(3) for retirees whose earnings have fully recouped their allowance for three consecutive years, beginning with 2007-2009 earnings statements. Boards should be aware that PERAC—not the board—will identify affected retirees, notify them and the board, and conduct the hearing/appeal process, but boards must be prepared to continue withholding a portion of allowance for health insurance premiums and to continue treating affected members as disability retirees for c. 32A §10 and c. 41 §100B purposes.

PERAC Memorandum #22, 2010 addresses the DALA decision in Petrucci v. PERAC, which followed the earlier Amoah precedent, holding that a member on partial workers' compensation who continues part-time employment with the same employer where the injury occurred is entitled to full creditable service for that period. Boards must now grant full creditable service in such cases going forward; however, if a member receiving partial workers' compensation is not concurrently employed with the same employer, no creditable service should be granted for that period.

PERAC Memorandum #23, 2010 notifies boards that the Appeals Court decision in O'Brien v. CRAB, which held that clothing allowances do not constitute regular compensation for retirement calculation purposes, is now final and may affect treatment of other types of payments previously counted as regular compensation. PERAC's Legislative Sub-Committee is reviewing the decision's broader implications, with further Commission discussion and guidance forthcoming. No immediate action is required of boards at this time, but administrators should await additional PERAC guidance before making changes to how compensation is classified.

This memo transmits the final version of 840 CMR 15.03, PERAC's amended regulation defining "regular compensation," effective May 28, 2010, and instructs boards to disregard earlier drafts. Boards must apply the regulation's criteria and statutory exclusions when determining whether payments made on or after July 1, 2009 qualify as regular compensation, noting that excluded items may still count as regular compensation through the end of existing collective bargaining agreements or contracts in effect on May 1, 2009 (but no later than June 30, 2012). Boards should hold off on finalizing determinations regarding clothing allowances pending possible legislative action, and should expect further PERAC guidance related to implementation and the O'Brien v. CRAB decision.

This memo reminds boards that termination allowance approvals under G.L. c. 32, §10(2) must continue to be submitted to PERAC for review and approval, given an uptick in filings due to budgetary constraints. It clarifies that the three-year average compensation calculation (vs. the standard five-year average) applies only if a board's legislative body and chief executive officer have accepted the 1984 local option under Chapter 473. Boards that have accepted this local option but are not shown as such on PERAC's website should submit documentation of that acceptance to PERAC.

PERAC Memorandum #26/2010 announces an updated form (effective July 1, 2010–June 30, 2011) for members applying for reinstatement to service under G.L. c. 32 §105. Boards must complete the initial portion of the form for interested members and provide thorough counseling on repayment obligations and the five-year full-time employment requirement before members sign and convert from retiree to member-in-service status.

Memorandum #27, 2010 announces that effective July 1, 2010, the annual supplemental dependent allowance under G.L. c. 32, §§ 7(2)(a)(iii), 22D, and 9(2)(d)(ii) increases to $729.84 per eligible child. Boards that have accepted these provisions must apply this updated amount when paying benefits to accidental disability retirees and accidental death survivors with eligible dependent children. No formal acceptance action is required, but boards should update payment amounts accordingly and contact PERAC's actuary with questions.

This memo transmits PERAC's updated quarterly list (as of 6/30/10) of investment managers previously granted exemptions under 840 CMR 19.01 for international equity, international fixed income, real estate, and alternative investment asset classes. Boards may hire managers from this list without seeking a separate exemption, but must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form, and receive PERAC acknowledgement before transferring funds; no exemption is needed for domestic equity/fixed income managers, and boards may still pursue exemptions for managers not on the list.

PERAC Memorandum #30/2010 transmits the updated July 2010 Tobacco Company List, which replaces all prior lists and takes effect immediately upon receipt, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997 (including violations arising within pooled funds assessed as a whole). Boards must forward the list to their investment advisors (or direct them to PERAC's website) and note it applies solely to Massachusetts public fund clients; boards found holding non-compliant investments during PERAC's audit must divest prudently and are required to consult with PERAC before taking any divestment action.

This memo explains that effective July 1, 2010 (per Chapter 131 of the Acts of 2010), members who voluntarily terminate service with less than 10 years of creditable service and withdraw their contributions will have their refund interest calculated at a flat 3% rate for the entire period, replacing the prior tiered interest treatment for those with less than 5 or 10 years of service. This change applies only at the time of refund disbursement (not to interest credited while funds remain on deposit), does not affect involuntary withdrawals or members with 10+ years of service, and leaves buyback rules unchanged. Boards should use the PERAC spreadsheet/examples provided (pending an updated withdrawal application form) to manually calculate affected refunds, continue processing disbursements via Refunds to Members #5757 with interest transferred from the Pension Reserve Fund to the Annuity Savings Fund, maintain thorough documentation for potential future reemployment situations, and carefully counsel and provide written notice to members applying for refunds about how this provision affects them.

PERAC Memorandum #33/2010 summarizes provisions of Chapter 188 of the Acts of 2010 (Municipal Relief Act) governing actuarial valuations, funding schedules, and COLA base increases—including the new biennial valuation/six-year experience study requirement, the 95% minimum funding payment rule under §22D, the new §22F option allowing systems to adopt a funding schedule reaching full funding by June 30, 2040 under specified constraints, and the ability under §103(j) to raise the COLA base in $1,000 increments. Boards should review these provisions carefully (referencing the attached law) to determine whether to pursue a revised funding schedule under §22F or a COLA base increase under §103(j); any COLA base increase requires board vote plus approval by the appropriate legislative body and certification filed with PERAC, and once accepted cannot be revoked.

This memo clarifies that PERAC's acknowledgement letters for prospective investment managers confirm receipt of required documents (competitive process letter, disclosures, vendor certification) but do NOT constitute authorization to proceed without full compliance with 840 CMR investment regulations—boards should obtain separate legal counsel assurance on this point. Where a manager's documents conflict with specific PERAC regulations, boards must submit specific, narrowly-tailored supplementary regulation requests (PERAC will not issue blanket exemptions), citing the exact regulations at issue and the rationale for relief.

PERAC Memo #35, 2010 requests that all retirement boards submit appropriation data needed to calculate FY12 governmental unit appropriations under G.L. c.32, §22D, §22(6A)(b), or §22F. Boards must complete and return the enclosed questionnaire (or submit via PERAC's website) by October 31, 2010, and boards whose funding schedules have not been updated within the past three years should contact PERAC to arrange a new submission, as required by law.

This memo announces IRS-required technical amendments to PERAC regulation 840 CMR 3.08, which governs actuarial assumptions used in applying the IRC Section 415(b) benefit limit; the changes are non-substantive and needed to secure the IRS's favorable determination letter for the Massachusetts Retirement Systems. No board action is required beyond optional review of the draft amendment (posted on PERAC's website) and, if desired, submission of public comments or attendance at the October 20, 2010 hearing.

This memo transmits PERAC's quarterly-updated list (as of 9/30/10) of investment managers previously granted exemptions under 840 CMR 19.01 for international equity, international fixed income, real estate, and alternative investment asset classes; only funds still open to new investors are included. Boards do not need to seek a new exemption when hiring a listed manager, but must still submit the Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form under 840 CMR 17.04(8)(a)-(b) and obtain PERAC acknowledgement before transferring funds; boards may also pursue exemptions for managers not on the list. Note that domestic equity/fixed income managers never require exemptions, and this list is separate from PERAC's general Investment Managers, Consultants, and Custodians directory.

PERAC Memo #38 (2010) transmits the updated October 2010 Tobacco Company List, which supersedes all prior lists and takes effect immediately upon receipt, identifying companies deriving more than 15% of revenue from tobacco sales (including qualifying pooled funds) in which new investments are prohibited under Chapter 119 of the Acts of 1997. Boards must share this list with their investment advisors (noting it is for Massachusetts public fund use only), ensure their portfolios comply with the restriction, and—if any noncompliant holdings are found during PERAC's audit—consult with PERAC before divesting in a prudent manner.

This memo addresses the federal/state requirement (G.L. c. 32, §12D) that inactive, non-retired members who turn age 70½ must begin receiving a distribution by April 1 of the following year, and provides a sample notification letter boards can use. Boards should send notices (ideally in December, with a March 1 return date) urging affected members to contact the board for counseling on distribution/rollover options—rather than mailing all forms automatically—and should follow up with non-responders; PERAC also suggests boards consider sending an advance notice at age 69 to help members avoid tax penalties.

PERAC Memorandum #40, 2010 asks retirement boards to review and update their disability retiree database to ensure accurate tracking of post-retirement earnings limits, since disability allowances are now terminated (not just suspended) for non-compliance. Boards must update statuses for deaths, nursing home confinements, waived allowances, returns to active status, or address changes, and submit a completed "New Member Data" form for all new 2010 disability retirees, with all information due to PERAC by January 19, 2011, ahead of the 91A Annual Statements mailing.

This memo notifies boards that the Social Security Administration's COLA of 5.8% translates, under the statutory 3.0% cap in Chapter 32, §103(c), to a maximum allowable retiree COLA of 3.0% effective July 1, 2009. Boards should be aware that this figure sets the ceiling for any COLA they choose to grant, and each board must notify PERAC of its decision (whether to grant a COLA, and at what rate) within 30 days of making it.

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.

PERAC Memorandum #3, 2009 requests that all retirement boards submit active member, retiree/survivor, and disability retiree data as of December 31, 2008, in the standard PERAC record format by March 31, 2009. Boards must review the resulting data analysis reports to correct any errors or warnings identified, and PERAC staff are available to assist with this data maintenance process. Boards scheduled for a 2009 actuarial valuation should have already received a separate, specific data request.

This memo announces the Calendar Year 2008 Annual Statement process, with materials distributed via CD, and offers informal "help-desk" style regional consultations with PERAC auditors instead of formal presentations. Boards must complete and return the signed Annual Statement to PERAC by May 1, 2009, and submit their pre-closing cashbook and trial balance for December 2008 by February 28, 2009 (contacting Frank Valeri if that deadline poses issues); boards are also encouraged to sign up in advance if attending a help-desk session.

This memo provides the quarterly-updated (as of 12/31/08) PERAC list of pre-approved investment managers/funds in international equity, international fixed income, real estate, and alternative investments that have already been granted an 840 CMR 19.01 exemption and remain open to new investors. Boards do not need to apply for a new exemption when hiring a manager from this list, but must still submit the Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form and receive PERAC acknowledgement before transferring funds; boards may also still pursue exemptions for managers not on the list, and no exemption is needed at all for domestic equity/fixed income hires (only the three forms).

This memo provides the updated January 2009 Tobacco Company List required under Chapter 119 of the Acts of 1997, which prohibits retirement systems from making new investments in companies deriving more than 15% of revenue from tobacco sales (including pooled funds meeting this threshold). Boards must replace any prior list with this one immediately, distribute it to their investment advisors (for MA public fund use only), and ensure their portfolios remain compliant—consulting with PERAC before divesting if any non-compliant holdings are found during PERAC's audit review.

This memo transmits Chapter 467 of the Acts of 2008, effective April 9, 2009, which creates a local option under G.L. c. 32, §3(2)(g) allowing municipalities to reclassify uniformed EMTs of a municipal or public emergency medical service into Group 4. Acceptance requires local action (city council/manager or mayor approval, or board of selectmen vote) and is not automatic. Boards should notify PERAC and submit certified copies of any local acceptance action if/when their municipality adopts this option.

PERAC Memorandum #8/2009 provides retirement boards with updated instructions, worksheets, and the cumulative interest factor sheet for calculating buyback and make-up repayments using buyback interest for calendar year 2009, applicable to the various G.L. c. 32 provisions referenced in prior Memos #13/2005 and #28/2008. Boards should use these updated materials for all applicable buyback/make-up calculations going forward, replacing prior year factors; no further action is required beyond adopting the new worksheets in practice.

Memorandum #9 (2009) requests retirement boards' assistance in verifying data for PERAC's 2008 Annual Report, including board contact/meeting information, board member and administrator names as of December 31, 2008, and the current list of investment managers, custodian, and consultant. Boards must also calculate and report their Target Investment Rate of Return (distinct from the Actuarial Rate), based on current asset allocation and projected asset class returns. All annotated materials and the target rate calculation were due to Rose Cipriani at PERAC by February 16, 2009.

This memo confirms there have been no changes to the Pension Protection Act provision (previously detailed in PERAC Memos #37/2007 and #43/2007) allowing retired public safety officers to exclude up to $3,000 from gross income for health insurance or long-term care insurance premiums deducted from their retirement allowance. No new board action is required; boards should continue following the procedures outlined in the earlier memos.

PERAC Memorandum #11, 2009 addresses the annual review of the maximum reimbursement amount for non-invasive medical tests ordered by Regional Medical Panels under 840 CMR 10:10(3) and 10:15(4). The Commission voted on January 27, 2009 to continue its past practice of authorizing PERAC staff to approve such testing costs up to $100.00 per case, with no action required by retirement boards beyond awareness of this continuing threshold.

PERAC Memorandum #12, 2009 announces disability training seminars for retirement board staff in 2009, covering disability basics, Workers' Compensation calculations, and the 91A process, with sessions scheduled for March 19 and May 14 at PERAC (additional sessions in Western Massachusetts to be announced). Boards should submit topics of interest to Kate Hogan (without case-specific details) and, if interested in attending the March 19 session, complete and return the attached registration form; no other action is required.

This memo alerts boards that the IRS has issued a Pilot Governmental Plan Questionnaire to a sample of governmental pension plans (with a larger round to follow), and that any Massachusetts retirement board plan could be randomly selected despite having already filed a Determination Letter request. If a board receives a questionnaire, it should not complete it independently but should retain a copy for its records and forward the original to PERAC for handling.

PERAC Memo #14/2009 clarifies that G.L. c. 32, §20 (and analogous statutes for the State and Teachers' Retirement Boards) requires that all four other board members be present and vote when selecting the fifth (or seventh, for MTRS) member; a vote taken without full participation of the other members is invalid, though the outcome need only reflect a simple majority. Boards must notify PERAC in writing upon selection of the fifth/seventh member, including a record of the vote confirming that all required members were present and voted.

PERAC withdrew the proposed regulation that would have required two Physician's Statements for disability retirement applications, opting instead to revise the single Physician's Statement form itself, with input from its consulting physician, to improve clarity and reporting of medical findings. The revised form separates accidental disability questions (3A) from Heart/Lung/Cancer presumption cases (3B); boards should begin using this updated Treating Physician Statement immediately and must use it for all disability applications initiated on or after June 1, 2009, with completed statements still requiring an original signed hard copy submission.

This memo transmits PERAC's quarterly updated list (as of 3/31/09) of investment managers previously granted exemptions under 840 CMR 19.01 in the international equity, international fixed income, real estate, and alternative investment asset classes. Boards may hire any manager on this list without seeking a new exemption, but must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form to PERAC and receive acknowledgement before transferring funds; no action is required for domestic equity/fixed income hires beyond these three documents, and boards remain free to request exemptions for managers not on the list.

PERAC Memo #17/2009 transmits the updated April 2009 Tobacco Company List, superseding all prior versions, which retirement boards must use to comply with Chapter 119 of the Acts of 1997 barring new investments in companies deriving more than 15% of revenue from tobacco sales. Boards should distribute this list to their investment advisors (for MA public fund use only), apply the 15% test at the pooled-fund level when applicable, and — since PERAC audits portfolios for compliance — must consult with PERAC before divesting any holdings found in violation.

This memo clarifies that under G.L. c. 32, § 4(1)(c), retirement boards may—at their discretion, via board action—grant up to one month of creditable service for a member's unpaid furlough/leave period, regardless of how many separate leave periods occur. It also explains that if such service is granted, the member's pre-furlough regular compensation rate (per § 5(3)(b)) must be used for that period when calculating three-year average compensation, without requiring actual contributions, but only if that period falls within the averaging window. No mandatory board action is required beyond ensuring any discretionary creditable service grants and compensation calculations comply with this guidance.

This memo explains how the American Recovery and Reinvestment Act of 2009 (ARRA) affects retiree withholding: new IRS federal withholding tables took effect April 1, 2009, potentially increasing net allowances since retirement income (unlike earned income) doesn't qualify for the Making Work Pay Credit, creating a risk of under-withholding. It also describes two separate one-time $250 payments—a Social Security/Railroad Retirement payment and a Federal/State Retiree Credit (mutually exclusive)—that may apply to certain retirees. **Action required:** Boards should promptly notify the entity issuing retiree checks to implement the new withholding tables, and proactively inform retirees of the under-withholding risk, encourage them to consult a tax professional, and remind them they may file a new W-4P to adjust withholding if desired.

This memo announces PERAC's 2009 update to the Accounting Manual for Massachusetts Pension Systems, with revised pages provided to replace the originals distributed in 2008. Boards should update their physical manuals with the enclosed pages (or download them from PERAC's website) and note that future updates will be distributed electronically via email notification rather than in print.

Memorandum #21 (2009) announces PERAC's new Electronic Content Management System for scanning disability case documents and reminds boards that the Request for Appointment of a Regional Medical Panel process is unchanged, though updated bar-coded PDF fill-in forms (including the new Treating Physician's Statement) are now available via CD or the PERAC website. **Action required:** Boards must use the new bar-coded Treating Physician's Statement for all applications initiated on or after June 1, 2009 (the old version is accepted only until then); avoid stapling, tearing, resizing, or writing on document bar codes; never email unencrypted disability/membership forms containing personal identifying information; and update their disability manuals with the enclosed replacement pages, watching for future updates posted on PERAC's website.

**Memorandum #22, 2009 — Foresta v. CRAB Summary** The SJC ruled in *Foresta v. Contributory Retirement Appeal Board* that an employer may modify an injured employee's job duties and description, and this modified position—rather than the original job at time of injury—may serve as the basis for evaluating eligibility for accidental disability retirement, provided the modified duties are "similar in responsibility and purpose" to the original job and the modification is not merely a temporary or pretextual accommodation. Retirement boards should apply this standard when reviewing ADR applications involving employees who have been placed in accommodated or modified positions, assessing whether the modified role meets the similarity test before determining disability eligibility. No specific board action is mandated beyond incorporating this legal standard into future ADR case reviews.

Memorandum #23/2009 follows up on IRS Notice 1036-P, which supplements earlier federal withholding table updates addressed in Memo #19/2009. Boards must choose between (1) continuing to use the previously implemented "February tables," or (2) adopting an additional withholding adjustment based on payment frequency, marital status, and pension amount per Notice 1036-P—reverting to the old tables is not permitted. No specific deadline is set for adopting the second option, but boards should review the attached IRS Notice and Ice Miller E-Alert and select and implement one of the two compliant approaches.

PERAC Memo #25 (2009) announces the annual update to the Application for Reinstatement to Service under G.L. c. 32 §105, effective July 1, 2009 through June 30, 2010. Boards should use the revised form, complete the initial portion for interested members, and carefully counsel applicants on the repayment obligations and five-year full-time service requirement before they sign and convert from retiree to active member-in-service status.

This memo announces the annual COLA adjustment to the supplemental dependent allowance under G.L. c. 32 §§ 7(2)(a)(iii), 22D, and 9(2)(d)(ii), setting the payment at $708.60 per eligible child effective July 1, 2009. Boards that have accepted these provisions must update their systems to pay this new annual amount to eligible accidental disability retirees and accidental death survivors for each qualifying dependent child, with questions directed to PERAC's actuary Jim Lamenzo.

PERAC Memorandum #27 (2009) provides the quarterly-updated list, as of 6/30/09, of investment managers granted exemptions under 840 CMR 19.01 in the asset classes of international equity, international fixed income, real estate, and alternative investments. Boards that have previously received an exemption for a given asset class may hire managers from this list without applying for a new exemption, but they must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form, and receive PERAC's acknowledgement before transferring funds; no exemption is required at all for domestic equity/fixed income managers. Boards may also seek exemptions for managers not on the list, and should note this list is distinct from PERAC's general roster of investment managers, consultants, and custodians.

This memo (PERAC Memo #28, 2009) transmits an updated Tobacco Company List (dated July 2009), replacing all prior versions, identifying companies deriving more than 15% of revenue from tobacco sales in which retirement systems are prohibited from making new investments under Chapter 119 of the Acts of 1997. Boards should share the list with investment advisors (noting it is for Massachusetts public fund use only), ensure their portfolios—including pooled funds assessed on a whole-pool basis—remain in compliance, and consult with PERAC before divesting any non-compliant holdings identified during audit review.

This memo corrects PERAC Memo #25/2009 by providing an updated Application for Reinstatement to Service form (effective July 1, 2009–June 30, 2010) under G.L. c. 32 §105, since the prior version incorrectly used the full actuarial interest rate rather than the buyback rate (half the assumed rate) required by Chapter 302 of the Acts of 2008. Boards should use only this revised form going forward, complete the initial section for members seeking reinstatement, and ensure members are properly counseled on the repayment obligations and five-year full-time employment requirement before they sign and convert from retiree to active member-in-service status.

This memo announces that PERAC has moved its library of publications and training materials—previously distributed as hard copies to new board members and administrators—to CD format, in order to reduce printing and postage costs. Boards should provide these CDs to newly appointed members/administrators for orientation purposes; no other action is required, and additional copies can be requested from PERAC's Communications Director if needed.

PERAC Memo #31/2009 announces proposed regulations (840 CMR 3.00) intended to bring Massachusetts retirement systems into compliance with IRS requirements, along with the related IRS Voluntary Correction Program Compliance Statement, both posted on PERAC's website. Boards should review the draft regulations and may submit public comments through September 11, 2009, or attend one of the scheduled public hearings (September 10 in New Bedford or September 11 at PERAC) or the Emerging Issues Forum discussion on September 9 at Holy Cross.

PERAC Memo #32/2009 notifies boards that, following PRIM's termination of its Portable Alpha program and increase in Absolute Return allocation, PRIT's total hedge fund exposure will drop from 11% to 8%, correspondingly lowering the maximum permissible hedge fund allocation for local retirement systems to 8%. Boards already exceeding 8% may retain their current allocations without action, but any board seeking a new or continued allocation above 8% must formally request a supplementary regulation with detailed justification.

This memo clarifies COLA eligibility timing when an Accidental Disability retiree dies and their beneficiary begins receiving an Accidental Death benefit under G.L. c. 32, §9 (or §101). Because this is a new benefit rather than a continuation of the deceased member's allowance, the beneficiary must have been receiving the Accidental Death benefit as of June 30 of the prior fiscal year to qualify for a COLA—unlike an Option C beneficiary, who continues the member's existing benefit and is COLA-eligible if the member's benefit was in place by that date. Boards should apply this distinction when processing COLA payments for Accidental Death beneficiaries; no other action is required.

PERAC Memo #34/2009 explains changes to G.L. c. 32, §7(2)(a)(ii) made by Chapter 21 of the Acts of 2009, which alter how regular compensation is determined for accidental disability allowance calculations when a member was serving in a temporary or acting position at the time of injury—such members' pensions are now based on the average annual rate of regular compensation for the prior 12-month period, rather than the compensation rate on the date of injury. Boards must use the attached new form for all accidental disability retirement calculations submitted after the memo's date, and should ensure staff apply the correct compensation basis depending on whether the member held a temporary/acting position at the time of injury.

Memorandum #35 (2009) clarifies the impact of Chapter 21 of the Acts of 2009, which repealed G.L. c. 32, §§4(1)(o) and 4(1)(o½), eliminating the ability to purchase uncompensated service as an elected official or library trustee. PERAC advises that members who fully completed such purchases before July 1, 2009 may retain that credited service, but boards may no longer accept new purchase requests for this type of service, even for periods occurring before the repeal. No further board action is required beyond ceasing acceptance of such purchase applications going forward.

Memorandum #36/2009 announces PERAC's newest pension fraud awareness poster ("Pension Fraud Is Stealing"), part of an ongoing campaign supporting the Commission's confidential fraud hot line (1-800-445-3266). Boards should display the enclosed posters in high-visibility areas of their offices and distribute the accompanying brochures and "Referral Report of Potential Fraud" forms to staff and the public for reporting suspected fraud; additional materials are available from PERAC's Communications Director upon request.

Memorandum #37 (2009) addresses Chapter 21 of the Acts of 2009, which amended G.L. c. 32, §11(1) to require retirement boards to contact a withdrawing member's employer before releasing accumulated total deductions, to confirm whether the member owes an obligation under an employee benefit plan (e.g., a §125 cafeteria plan). If an obligation is owed, the board must withhold the refund until the employer certifies it has been satisfied—but the board may not divert or release the funds directly to the employer. Boards must update their Application for Withdrawal of Accumulated Total Deductions form (Section B) to include this employer certification, per the revised form attached to the memo.

PERAC Memorandum #38/2009 requests that retirement boards submit appropriation data needed to calculate FY11 governmental unit appropriations under G.L. c. 32, §22D or §22(6A)(b). Boards must complete and return the enclosed questionnaire (or submit via PERAC's website) no later than October 31, 2009, and should also confirm their funding schedule has been resubmitted for approval within the past three years, contacting PERAC if an update is needed.

PERAC Memorandum #39 (2009) provides retirement boards with the updated quarterly list, current as of 9/30/09, of investment managers who have received a PERAC exemption under 840 CMR 19.01 for international equity, international fixed income, real estate, and alternative investment asset classes. Boards hiring a manager already on this list do not need to seek a new exemption, but must still submit a Competitive Process Notification Form, Vendor Certification Form, and Disclosure Form to PERAC and receive acknowledgement before transferring funds; no exemption or listing applies to domestic equity/fixed income managers, and boards remain free to request exemptions for managers not on the list.

PERAC Memo #40/2009 transmits the updated October 2009 Tobacco Company List, replacing all prior lists, effective immediately upon receipt, pursuant to Chapter 119 of the Acts of 1997, which bars new retirement system investments in companies deriving over 15% of revenue from tobacco sales. Boards must share the list with their investment advisors (noting it is restricted to Massachusetts public fund use only), ensure their portfolios—including pooled funds assessed on a whole-pool basis—comply with the prohibition, and, if non-compliant, consult with PERAC before prudently divesting any restricted holdings acquired after January 13, 1998.

PERAC Memorandum #41 (2009) transmits an updated CD (dated September 2009) containing fill-in PDF forms for Disability and General Membership applications, replacing the March 2009 CD. The only change is the revised "Application for Withdrawal of Accumulated Total Deductions" form (previously announced in Memo #37); all other forms remain unchanged. Boards should begin using the updated Withdrawal form and retain/distribute the new CD accordingly.

PERAC Memorandum #42/2009 announces proposed regulations implementing Chapter 21 of the Acts of 2009, which narrowed the definition of "regular compensation" for payments received after July 1, 2009, and lists specific exclusions (e.g., overtime, bonuses, severance payments, in-kind payments). Until final promulgation (expected after June 2010), boards should continue treating previously-qualifying compensation as regular compensation unless it falls under one of the enumerated exclusions, while noting that certain grandfathered items covered by collective bargaining agreements or contracts in effect on May 1, 2009 remain includible only through June 30, 2012. No immediate board action is required beyond applying these transitional rules pending final regulations.

This memo addresses PERAC's annual review of the maximum reimbursement amount for non-invasive medical tests ordered by Regional Medical Panels under 840 CMR 10:10(3) and 10:15(4). PERAC's Commission voted on October 27, 2009 to maintain the existing $100 per-case cap that PERAC staff may approve without additional Commission review. No action is required by retirement boards; this is informational only.

This memo clarifies prior updates to PERAC's hedge fund guidelines: the asset threshold for boards to independently invest in hedge funds was lowered to $150 million (Memo #37, 2008), and following PRIM's termination of its Portable Alpha Program, the maximum allowable hedge fund allocation was reduced from 11% to 8% (Memo #32, 2009), though boards already exceeding 8% are not required to reduce holdings. No new action is required beyond ensuring boards understand current limits—systems may invest in PRIM's hedge fund segment up to 8% without PERAC approval, hedge fund investments remain limited to funds of funds, and exceptions may still be requested via supplementary regulation.

This memo notifies boards that under the 2009 Ethics Reform Law, board members and staff are considered public employees subject to mandatory conflict-of-interest education requirements administered by the State Ethics Commission. Boards must distribute the Commission's Summary of the Conflict of Interest Law to all covered individuals by December 28, 2009 (and annually thereafter, or within 30 days for new members/employees), retain signed acknowledgments, and ensure all covered persons complete the online ethics training by April 2, 2010 (and every two years thereafter), retaining completion certificates for six years. Boards should also forward copies of acknowledgments and certificates to the appointing authority for non-elected board members and note that related Open Meeting Law amendments will take effect July 1, 2010, with further guidance to follow.

This memo addresses the new requirement under G.L. c. 32, §12D that inactive, non-retired members who reach age 70½ must begin receiving a distribution by April 1 of the following year, consistent with federal RMD rules, and provides a sample notification letter for this purpose. Boards must notify affected members (with those already over 70½ in 2009 needing distributions by April 1, 2010) and are encouraged to urge members to seek counseling given the complexity of rollover options rather than simply distributing forms. Going forward, boards should send annual notices to members turning 69 to alert them of their upcoming RMD deadline and encourage timely application.

Memorandum #47 (2009) notifies boards that Section 19 of Chapter 166 of the Acts of 2009 further amended G.L. c. 32, §7(2)(a)(ii), retroactive to July 1, 2009, superseding the earlier changes made by Chapter 21. Boards must recalculate and resubmit for PERAC review all accidental disability retirement allowances with effective dates on or after July 1, 2009 that were calculated under the now-repealed formula, using the required form and provided examples for the new 72%/75% calculation methodology.

PERAC Memorandum #48/2009 announces proposed amendments to 840 CMR 15.03, which sets forth the revised definition of "regular compensation" (following up on Memo #42/2009). The memo schedules a series of public hearings across the state between January 5 and January 14, 2010, and invites written public comment through January 19, 2010, in advance of the Commission's January 26, 2010 discussion. Boards should review the proposed regulation and may wish to attend a hearing or submit comments, but no other action is required at this time.

PERAC Memo #49/2009 asks retirement boards to review and update their disability retiree database to ensure PERAC can accurately enforce statutory post-retirement earnings limits, since non-compliance now results in termination (not just suspension) of a member's allowance. Boards must review the enclosed list to report status changes (death, nursing home confinement, waiver, return to active status, address changes) and complete the "New Member Data" form for all 2009 disability retirees. All updates must be returned to PERAC by January 15, 2010, prior to the mailing of the 2008 Annual Statements of Earned Income (91A).

This memo addresses the annual review required under 840 CMR 10:10(3) and 10:15(4) regarding the maximum cost PERAC will cover for non-invasive medical tests ordered by Regional Medical Panels. PERAC voted to continue its past practice, maintaining the $100 per-case threshold that staff may approve without additional Commission review. No action is required by boards, but administrators should be aware that any testing costs exceeding $100 still require advance Commission approval.

This memo announces that the Social Security COLA for 2007 is 2.3%, which sets the base COLA rate boards may grant under G.L. c. 32, §103(c) effective July 1, 2007; boards may vote to increase this up to 3% under §103(i) with proper notice to their legislative body. Each retirement board must notify PERAC of its COLA decision (whether to grant, and at what rate) within 30 days of that vote.

This memo announces the Calendar Year 2007 Annual Statement process, providing materials via CD (2007 Annual Statement, Sample Statement, and preparation guide) and offering PERAC auditor assistance and regional training sessions. Boards must complete, sign, and return the Annual Statement to PERAC by May 1, 2008, and submit their pre-closing cashbook and trial balance for December 2007 by February 28, 2008; those wishing to attend training sessions must pre-register using the attached form.