Common use of First Tier Retirement Clause in Contracts

First Tier Retirement. Formula (2% at 55) A. The Union and the State (parties) to enhance the current age benefit factors on which service retirement benefits are based for Miscellaneous and Industrial members of the First Tier plan under the Public Employees’ Retirement System (CalPERS). The parties further agree that the provisions of this article will be effective only upon the CalPERS board adopting a Resolution that will employ, for the June 30, 1998 valuation and thereafter, 95% of the market value of CalPERS’ assets as the actuarial value of the assets, and to amortize the June 30, 1998 excess assets over a 20 year period, beginning July 1, 1999. The parties agree to jointly request the CalPERS board to extend the 20 year amortization period in the event the cost of these benefits or unfavorable returns on investments results in an increased employer contribution by the State. B. The legislative language provides the enhanced benefit factors to State employees who retire directly from State employment on and after January 1, 2000. C. The table below compares the current First Tier age benefit factors to the improved factors that the proposed legislation would place in the part of the Government Code administered by CalPERS. 50 1. 092 1.100 51 1.156 1.280 52 1.224 1.460 53 1.296 1.640 54 1.376 1.820 55 1.460 2.000 56 1.552 2.063 57 1.650 2.125 58 1.758 2.188 59 1.874 2.250 60 2.000 2.313 61 2.134 2.375 62 2.272 2.438 63 and over 2.418 2.500 D. There will be factors for attained quarter ages, such as 52 ¾, that will be included in the implementing legislation. These improved age benefit factors will apply for service rendered on and after the effective date of the memorandum of understanding between the State and the Union. The improved factors will also apply to past service that is credited under the First Tier and the Modified First Tier. E. The amount of member contributions required of employees who will be covered under these new factors will continue to be 5 percent of monthly compensation in excess of $513.