Step Into Retirement Benefits FAQ: Part One
Step into the Retirement Benefits FAQ Section, the first installment of a two-part series.
Whether you're navigating your pension plan, planning for retirement, or considering your options post-retirement, these segments are designed to provide answers to common questions and help clarify any uncertainties you may have about your retirement benefits. From understanding pension tiers and accrual accounts to exploring disability retirement and death benefits, we aim to empower you with the knowledge to make informed decisions about your financial future.
Q: What is San Luis Obispo County Pension Trust (SLOCPT)?
A: SLOCPT is a Defined Benefit retirement plan or pension plan. A calculated monthly retirement benefit is provided for life. Benefits are funded from Employee and Employer contributions, as well as pooled investment earnings.
Q: Who is eligible to participate in the SLOCPT Retirement Plan?
A: All permanent Employees of the County (the “County”), the San Luis Obispo County Superior Court (the “Court”), the San Luis Obispo County Air Pollution Control District (“APCD”), the San Luis Obispo County Local Agency Formation Commission (“LAFCO”), the administrative staff of the San Luis Obispo Regional Transit Authority (“RTA”), and Employees of SLOCPT are required to participate. Elected officials may choose to become Members upon assuming office. Membership begins the first day of work (hire date) as a permanent Employee.
Q: Who are the Board of Trustees?
A: The Board of Trustees is the governing body responsible for the administration and management of SLOCPT. The Board of Trustees is composed of seven (7) members; the County Auditor/Controller/Treasurer/Tax Collector (who is an ex-officio Trustee), three (3) members appointed by the County Board of Supervisors, and three (3) members elected by the Active Members.
Q: Are retirement benefits different for particular "Classes" of Employees?
A: Yes, benefit calculations vary among different “Classes” of Employees, due to the retirement formulas outlined in the Plan. These formulas incorporate different retirement factors tailored for Employees categorized under the Miscellaneous, Safety, and Probation classes of pension membership.
Q: Are there different Tiers of retirement benefits?
A: Yes, the Retirement Plan includes three (3) Tiers of benefits. Each Tier features distinct retirement formulas with varying Retirement Factors tailored for Tier 1, Tier 2, and Tier 3 Members, along with associated benefit caps unique to each Tier. Tier 1 formulas apply to individuals hired before 2011, Tier 2 formulas apply to individuals hired between 2011 and 2012, and Tier 3 formulas apply to individuals hired in 2013 and thereafter.
Q: When am I eligible to retire?
A: Once a Member has reached the minimum retirement age (age 50 or 52 for those under Miscellaneous Tier 3) and has accumulated five (5.0) years of Pension Trust Service Credit (PTSC), they are eligible to retire.
Q: How is my retirement benefit determined?
A: Retirement benefits are determined based on a formula contained in the Plan. In general, retirement benefits will be based on:
> Accumulated years of Pension Trust Service Credits (PTSC)
multiplied by,
> Retirement Age Factor (varies by age at retirement, class of membership, and pension tier)
multiplied by,
> Final Average Salary (FAS)
Q: How do I earn Pension Trust Service Credit (PTSC)?
A: PTSC is accrued for each eligible hour paid as a permanent Employee. This includes hours worked, paid vacation time, and paid sick leave. However, no PTSC is earned during unpaid leave periods. Since PTSC accrues for each eligible hour paid, part-time service is pro-rated (e.g., a 30-hour/week Employee would earn around 0.75 PTSC in one year).
Q: What is “Final Average Salary (FAS)”?
A: Final Average Salary refers to the average annualized monthly compensation earned by a Member. SLOCPT determines FAS by calculating the highest average regular hourly rate over either a consecutive 12 or 36-month period, depending on Tier placement. The calculated average hourly rate is then multiplied by 2,080 (number of hours in a full-time work year) and then divided by 12 to determine the average monthly compensation. FAS is limited to base pay only and excludes pay elements such as overtime, shift differential, uniform allowance, use of County housing, lump sum payments of vacation or sick leave, or any other type of compensation unless specified in the Plan.
Stay tuned for the continuation of our Retirement Benefits FAQ Section in next month's edition, where we'll dive even deeper into your retirement queries. Until then, remember that knowledge is key to securing your financial future. Cheers!
Katie Girardi
Executive Director
For questions regarding your pension, please call us at 805-781-5465 or email us at slocpt@co.slo.ca.us. Many of your questions may be answered by logging in to MemberDirect!
