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Sec. 4.1007. Service Retirement Allowances.
 
   (a)   Tier 1 Formula and Enhanced Tier 1 Formula for Airport Peace Officer Members and Airport Peace Officer Former Members. A Member who retires pursuant to the provisions of Section 4.1006 or Section 4.1007 shall receive a service retirement allowance calculated pursuant to the following Tier 1 Formula (formerly the Beta Formula): 2.16 percent (.0216) of the Member’s Final Compensation, calculated as of the date of retirement, multiplied by the number of years and parts thereof of the Member’s Service Credit, subject to applicable adjustments as provided below. An Airport Peace Officer Member or Airport Peace Officer Former Member who retires on or after January 7, 2018, shall receive a service retirement allowance calculated pursuant to the following Enhanced Tier 1 Formula: 2.30 percent (.023) of the Member’s Final Compensation, calculated as of the date of retirement, multiplied by the number of years and parts thereof of the Member’s Service Credit, subject to applicable adjustments as provided below. Each retirement allowance as so calculated shall be allocated between the following two components: (1) an annuity which shall be the actuarial equivalent of the Member’s accumulated contributions at the time of retirement (excluding any additional contributions paid to provide a larger annuity at the time of retirement), calculated in accordance with approved actuarial methods as of the date of retirement; and (2) a pension, in the amount of the remaining balance, payable to the retiree on account of the retiree’s service.
 
   The retirement allowance as so calculated shall be subject to the following adjustments, if applicable:
 
   (1)   Where the retiree’s allowance is subject to an age-based reduction, the adjustment provided in Subsection (b) of this section.
 
   (2)   If the retiree had been on disability retirement, the retiree’s service retirement allowance shall be reduced by an amount equal to the annuity which the total of the disability annuity payments made to the retiree would have provided had they still been part of the retiree’s accumulated contributions at the time of retirement.
 
   (3)   If the retiree received any minimum distribution required by the Internal Revenue Code, the retiree’s service retirement allowance shall be subject to adjustment as provided in rules to be adopted by the Board of Administration.
 
   (4)   The retiree may be entitled to a minimum pension of fifty percent (50%) of the amount determined pursuant to the aforesaid Tier 1 Formula. (The annuity portion of the retirement allowance shall not be changed as a result of the testing required in this provision.) This testing uses the retiree’s Tier 1 Formula entitlement and the pension and annuity entitlement amounts, as calculated above, provided that such shall be adjusted, if applicable, to: (i) exclude Service Credit purchased under Sections 4.1019 and 4.1020, and the annuity calculation shall likewise exclude accumulated contributions attributable to these purchases; and (ii) the annuity calculation, for members who made back contributions under either Section 4.1017(b) or Section 4.1017(c), shall exclude accumulated contributions in the person’s account which are attributable to matching contributions paid by the City in the prior plan. The purpose of this testing is to determine if, absent such purchases or matching City contributions, the pension would have required an increase to provide a minimum pension of fifty percent (50%) of the amount of the retiree’s Tier 1 Formula entitlement. If such test determines that an adjustment is in order, the pension portion of the retiree’s retirement allowance shall be increased by the same amount as the increase that the test determined would be necessary to provide a minimum pension of fifty percent (50%), and the total retirement allowance payable shall be increased accordingly (with the annuity portion remaining unchanged).
 
   (b)   Age-Based Reduction Factors. An age-based reduction shall be made by multiplying the retirement allowance by the factor set forth in the table below corresponding to the retiree’s age, taken to the completed quarter year.
 
EARLY RETIREMENT REDUCTION FACTORS
FOR 2.16 PERCENT FORMULA
 
45
0.6250
45 1/4
0.6325
45 1/2
0.6400
45 3/4
0.6475
46
0.6550
46 1/4
0.6625
46 1/2
0.6700
46 3/4
0.6775
47
0.6850
47 1/4
0.6925
47 1/2
0.7000
47 3/4
0.7075
48
0.7150
48 1/4
0.7225
48 1/2
0.7300
48 3/4
0.7375
49
0.7450
49 1/4
0.7525
49 1/2
0.7600
49 3/4
0.7675
50
0.7750
50 1/4
0.7825
50 1/2
0.7900
50 3/4
0.7975
51
0.8050
51 1/4
0.8125
51 1/2
0.8200
51 3/4
0.8275
52
0.8350
52 1/4
0.8425
52 1/2
0.8500
52 3/4
0.8575
53
0.8650
53 1/4
0.8725
53 1/2
0.8800
53 3/4
0.8875
54
0.8950
54 1/4
0.9025
54 1/2
0.9100
54 3/4
0.9175
55
0.9250
55 1/4
0.92875
55 1/2
0.93250
55 3/4
0.93625
56
0.94000
56 1/4
0.94375
56 1/2
0.94750
56 3/4
0.95125
57
0.95500
57 1/4
0.95875
57 1/2
0.96250
57 3/4
0.96625
58
0.97000
58 1/4
0.97375
58 1/2
0.97750
58 3/4
0.98125
59
0.98500
59 1/4
0.98875
59 1/2
0.99250
59 3/4
0.99625
60 and over
1.00
 
   (c)   Cap on Allowances. Service retirement allowances granted pursuant to Subsection (a) of this section may never exceed a member’s “Final Compensation.”
 
   (d)   WPERP Service Credit. Service credit with the Water and Power Employees’ Retirement Plan (WPERP) shall not be included in the calculation of the member’s retirement allowance pursuant to Subsection (a) of this section unless the member has purchased credit for this WPERP service with the Retirement System or unless such service credit was transferred to the Retirement System pursuant to reciprocity under current Section 4.1095 or prior Section 4.1060.
 
SECTION HISTORY
 
Added by Ord. No. 182,629, Eff. 7-25-13.
Amended by: Subsec. (d) added, Ord. No. 182,824, Eff. 12-19-13; Subsec. (a), Ord. No. 184,853, Eff. 4-6-17.