CERF
EMPLOYEE PARTICIPATION
Participation in the County Employee Retirement Fund (CERF) Pension Plan is mandatory for eligible employees hired on or after January 1, 2000, and working at least 1,000 hours during the year. If you are an eligible employee who is scheduled to work at least 1,000 hours during the year, you will become a participant automatically on your date of hire. If you are hired into an eligible parttime position, but will work at least 1,000 hours in a calendar year, you will enroll immediately upon hire as well. If you are hired on a part-time basis to work less than 1,000 hours during the year, you will not be enrolled in CERF at the time of hire. However, if you reach 1,000 hours in a calendar year, you become eligible for CERF and will enroll as follows:
If you reach 1,000 hours on or before June 30, you will enroll on July 1 of the current year.
If you reach 1,000 hours after June 30, you will enroll on January 1 of the following year.
If you are hired in a full-time position, then change to part-time status, you will remain in CERF and continue to make the required contributions regardless of the number of hours you work. This part-time service will be calculated using the 91- hour rule. As a participant, whether full-time or part-time, you will remain in CERF until you terminate county employment for a period greater than 30 days. Please keep your address updated with CERF in order to continue to receive important information regarding your benefits.
Note: Certain employees may receive pay from the county but not be eligible for CERF if they are covered under a separate retirement program established by the State of Missouri.
EMPLOYEE CONTRIBUTIONS
Effective with the signing of HB 1455, all participants hired on or after February 25, 2002, are required to contribute an additional 4% of their gross compensation to CERF, starting January 1, 2003. These employees are not required to make up the additional 4% contributions for the period of February 25 through December 31, 2002. Any part of the additional 4% contribution can be paid by the county on behalf of an employee, or it can be paid by the employee. Each county is responsible for determining how it will be paid. To further explain:
A non-LAGERS participant hired on or after February 25, 2002, will contribute 6% of gross salary.
An active non-LAGERS participant who was employed with the county prior to February 25, 2002, will continue making 2% contributions. However, if he terminates employment for more than 30 days, and is later rehired in an eligible position, he will be required to make a 6% contribution.
Additionally, non-LAGERS participants are required to make a .7% contribution to the 401(a) Savings Plan.
A LAGERS participant hired on or after February 25, 2002, will contribute 4% of gross salary.
An active LAGERS participant who was employed with the county prior to February 25, 2002, is not required to make contributions. However, if he terminates employment for more than 30 days, and is later rehired in an eligible position, he will be required to contribute 4%. NOTE: Contributions are pre-tax for state and federal income tax withholding and are required on all compensation, including, but not limited to, wages, vacation, sick leave, overtime and bonuses.
CHANGING LAGERS STATUS
If your status as a LAGERS or non-LAGERS participant changes, the following will occur:
You will receive the full benefit for those years of creditable service in which you were a non-LAGERS participant and made the required contributions.
You will receive two-thirds of the full benefit for those years of creditable service in which you were a LAGERS participant and made the required contributions.
If you receive a refund of contributions from LAGERS, you will be required to make up the mandatory contributions you would have paid to CERF had you not been in LAGERS. Your benefit for the period you were in LAGERS, for which you later received a refund, will be calculated at the non-LAGERS rate.
If you retire from LAGERS and return to work in the county but are not accruing additional service credit in LAGERS, you are considered a non-LAGERS participant for this period of time. In this case, you must make the mandatory contributions to CERF. Again, for this period of time, your CERF benefit will be calculated at the non-LAGERS benefit rate.
BECOMING VESTED
Being vested means that you have a permanent right to your pension benefit. In the CERF Pension Plan, you are entitled to a benefit after eight years of continuous creditable service during which you have worked and received pay for 1,000 hours in each of those eight years. Once you become vested, you are eligible to receive a full benefit at age 62, or an actuarially-reduced benefit as early as age 55.
REQUIRED DISTRIBUTION RULE
You must begin receiving required minimum distributions by April 1 of the calendar year following the year you turn age 72 or the year you separate from service, whichever is later. However, if you turned age 70 ½ before December 31, 2019, the prior rule will continue to apply to you, and you will be required to begin receiving distributions by April 1 of the calendar year following the year you turned age 70 ½ or the year you separate from service, whichever is later. If you leave county employment before you become vested, you will receive a refund of the contributions you made to the plan. Your contributions will be refunded in a lump-sum payment either directly to you or you may elect to have your contributions rolled over to an eligible retirement plan or IRA. The refund will be made as soon as administratively possible. In order to elect a rollover, the full amount of distribution must equal $200 or more. You may also elect a partial rollover if that portion of your distribution is at least $500 or more. Any refund of pre-tax contributions paid directly to you require tax withholding at a rate of 20%.
RETIREMENT PREPARATION
When you are ready to retire, you will need to complete a retirement application 30-90 days prior to your termination date and submit it to the CERF Administrative Office. All contributions required from you, whether paid by you or paid by the county on your behalf, must be received and reconciled by the CERF Administrative Office prior to your benefit commencement. Additionally, if you are still working at the time your retirement application is submitted to CERF the salary, hours and contributions cannot be verified until you have worked through your date of termination and all salary, hours and contribution information (if applicable) has been received from the county. Because of this, your first annuity payment may be delayed. You will, however, receive payment retroactive to your benefit commencement date.
Using information from your retirement application, the CERF Administrative Office will calculate your benefit and send a retirement packet to you. From the packet, you will select a payment option, determine tax withholding and complete banking information to receive your payment by direct deposit. All employees are encouraged to take the time and review the pre-retirement seminar video or attend pre-retirement seminar in their preparation for retirement. Please see more information on early retirements on the CERF website.
RETIREMENT CALCULATIONS
The formula for calculating your benefit is the Targeted Replacement Ratio (TRR). This formula uses your average final compensation, which is the average of your two highest years of compensation from the county. Compensation includes your regular wages or salary, overtime and bonuses.
PAYMENT OPTIONS
Several payment options are available. All of the optional forms of payment are “actuarially equivalent” to the normal form of payment. That means the monthly benefit amount from the optional payment method is adjusted (up or down) so that the value of the payments over your lifetime and your survivor’s lifetime is the same as the value of the normal form of payment.