Early Out Retirement Option Program Plan (language only)

Item 4-6.03 #1h

Language
Page 682, after line 29, insert:
“j.  There are hereby established the 2009 and 2010 Early Retirement Programs for School Division Employees.  School divisions have the option to participate in the 2009 Program, the 2010 Program, or in both the 2009 and 2010 Programs. The VRS Board of Trustees will develop policies and procedures to administer the Programs within the following parameters:
1)  Eligibility and Approval for Participation in the 2009 Program.
a)  The Program is limited to any professional or nonprofessional employee, except the school division superintendent, of a school board who has, as of June 30, 2009, (i) attained the age of 50; (ii) completed at least 25 years of service as a VRS covered employee; (iii) been in continuous service in a covered position with their school division during the period between January 1, 2009 and their date of retirement under this Program; and (iv) not previously received a retirement benefit from VRS since July 1, 2007.
b)  Any covered employee on official leave of absence during the period between January 1, 2009 and his or her date of retirement under this Program will be considered to be in continuous service.
c)  The school division, in its sole discretion, may elect whether the professional, nonprofessional, or both groups of covered employees will be eligible for the Program.  Participation by each employee who meets the eligibility criteria will be subject to approval by the school division, in the school division’s sole discretion.
2)  Grant of Service Under the 2009 Program.
a)  Eligible employees approved for participation by their respective school divisions (i) will be granted an adjustment to their accumulated creditable service for purposes of their retirement allowance and health insurance credit, and (ii) will not be subject to any actuarial reductions in their service retirement benefit, except as provided in §§ 51.1-165 and 51.1-165.01, Code of Virginia.
b)  Each school division may grant 1, 2, 3, 4, or 5 additional full years of creditable service to either or both of its professional and nonprofessional staff that participate in the Program. The additional years of service elected for the professional participants will apply uniformly to all professional participants, and the additional years of service elected for the nonprofessional participants will apply uniformly to all nonprofessional participants.  Granted service under the program will not be credited to a participating member’s record until his or her date of retirement under the Program.
3)  Deadline for Each School Division to Make Its Election for the 2009 Program.
a) No later than May 15, 2009, each school division shall notify VRS of its election to participate in the Program and the number of years of additional creditable service to be granted to its approved participants. Such elections shall be evidenced by resolutions approved by the Board of each participating school division and its local governing body.  
b)  Each participating school division shall notify each employee of his or her eligibility to participate in the Program no later than May 15, 2009.
4)  Repayment Obligations of Participating School Divisions in the 2009 Program.
Participating school divisions shall repay VRS for the cost of any granted creditable service at the rate of 20 percent of each participant’s annual salary at such participant’s retirement date multiplied by the number of years of granted creditable service.  Repayment will be made to VRS in five equal annual installments payable on July 1 of each consecutive year, commencing on July 1, 2010 or in a lump sum payment due by July 1, 2010.  
5)  Election by Participants for the 2009 Program.
Participation by a school division’s eligible employees shall be voluntary.  Each participant must elect participation and gain approval by his or her school division by June 1, 2009.  School divisions shall notify VRS of all approved participants by June 15, 2009.  Each participating employee should submit a service retirement application
to VRS at least 60 days prior to his or her retirement date.  
6)  Retirement Dates for the 2009 Program.
Any approved participant must elect a retirement date after June 30, 2009 and before July 1, 2010.
7)  Retirement and Employment Restrictions On Participants for the 2009 Program.
a)  Upon retirement under this Program, each participant agrees that he or she will not accept employment (i) with his or her former school division in any capacity, including employment as an independent contractor, or (ii) with any agency or business providing services to his or her former school division, unless in a capacity that is not comparable to the participant’s preretirement function or role within the school division.  Participation in a school division’s official Early Retirement Incentive Program (ERIP) or service as a substitute teacher shall not, however, be subject to this restriction.
b)  Except as provided in § 51.1-155(B)(2), (i) no participant shall obtain VRS covered employment with any other employer for at least 12 calendar months following his or her retirement date under the Program, and (ii) upon any subsequent reemployment in a VRS covered position, the added creditable service gained by participation in the Program will be forfeited upon subsequent re-retirement.
c)  Failure by a participant to comply with the restrictions in 7a and 7b will cause the participant to lose the benefits under this Program and obligate the participant to repay any such benefits already received.  
8)  The provisions of the 2009 Program shall apply to the 2010 Program mutatis mutandis with all of the relevant dates advanced forward by one full calendar year.

Explanation
(This amendment provides school divisions with the opportunity to offer early retirement programs to eligible professional and nonprofessional employees. To be eligible for the Programs, employees must be at least 50 years of age with 25 years of creditable service. Each school division may grant 1, 2, 3, 4, or 5 additional full years of creditable service to either or both of its professional and nonprofessional staff that participate in the Programs. Participating school divisions shall repay VRS for the cost of any granted creditable service at the rate of 20 percent of each participant’s annual salary at such participant’s retirement date multiplied by the number of years of granted creditable service. Repayment will be made to VRS in five equal annual installments payable on July 1 of each consecutive year, commencing on July 1, 2010 for the 2009 Program, or July 1, 2011 for the 2010 Program.)