Retirement factor (multiplied by) City service credit (multiplied by) final compensation (equals) service retirement allowance.
Each service retirement allowance shall be allocated between the following two components:
(1) An annuity which shall be the actuarial equivalent of the retiree’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) 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 unless, upon returning to service from disability retirement, a member elected, as provided by Board rule, to make additional contributions in order to restore part or all of the member’s annuity.
(2) 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.
(b) Cap on Allowances. In no event shall any Tier 2 retirement allowance exceed seventy-five percent (75%) of final compensation, except where the allowance is based solely upon the annuity component funded by the retiree’s accumulated contributions, and thus does not include a pension component. The seventy-five percent (75%) of final compensation limitation upon the retirement allowance set forth above, which is subject to one exception as noted, shall apply to the member’s retirement allowance prior to any adjustments that may be required as a result of the purchase of an additional annuity, the provision for a continuance to a survivor, or any other election authorized in this Article.
(c) Internal Revenue Limitations. All Internal Revenue Code limitations set forth in Section 4.1051(b) shall be applicable to benefits payable under Tier 2. In addition, Tier 2 members shall not be entitled to the payment of benefits to the extent such benefits are reduced by the limitations on benefits imposed by Section 415 of the Internal Revenue Code. Tier 2 members shall not be eligible to participate in the Excess Benefit Plan established in Section 4.1800.
(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.